When we think about market dominance, we jump straight to the banks, major supermarkets and big retailers. But the industry that should be on our radar is the telecommunications industry, which is at the epicentre of competition disputes.
Telecommunications services are one of the key drivers of productivity and growth in the Australian economy. Its centrality in our lives means that if we’re going to keep people connected, and at a reasonable price, we need to have well designed competition regulation.
The economic and social potential of our nation is only realised when we give everyone a voice and a stake in society.
We must ensure access to our telecommunications industry is competitive.
Currently, the Turnbull Government is trying to repeal longstanding and effective competition provisions known as Part XIB.
These provisions are working. Why try to fix something that isn’t broken?
The Government’s plans in this area are as confusing and incoherent as the Coalition itself.
In trying to introduce an ‘effects test’ the Government claims it wants to strengthen competition law, but at the same time its legislation would also weaken competition laws in the telecommunications sector.
The Government’s position is that important features of the telecommunications competition regime have been used less over time, and should therefore been repealed.
However, this is exactly why we should keep them. These features are working in the interests of the industry and consumers.
The introduction of Part XIB in 1997 was intended to supplement section 46 by increasing the ability of the ACCC to respond quickly to telecommunications specific conduct complaints.
It provides a strong deterrence against anti-competitive conduct, as well as faster mechanisms to respond when suspected cases arise.
This is particularly effective in the telecommunications sector, which has a high level of market concentration, and a unique level of interdependency among competing firms compared to other sectors in the economy.
It helps avoid unnecessary and costly court battles by providing the regulator with sufficient powers, and third parties with adequate rights. But most importantly, it provides an incentive for those Telcos in breach to change their behaviour.
The fact it is not being used frequently is evidence that Part XIB has been effective. Both participants and the regulator know how the regime works and the industry knows the ground rules.
The value of certainty is paramount.
Prevention is better than a cure.
It makes more sense to deter wrong doing, than having to negotiate and navigate the inundation of complaints if XIB is repealed.
Part XIB is good for competition and good for consumers, and it should not be repealed.
Stephen Jones is the Shadow Minister for Regional Communications. This piece originally appeared in Telecom Times on Monday 3 April, 2017