Queensland Dairyfarmers Organisation (QDO) along with Australian Dairy Farmers (ADF) have applauded the introduction of an ‘effects test’ by the Federal Government, which will strengthen competition across the grocery supply chain.
QDO & ADF have advocated strongly for the change since 2011, following Coles starting the supermarket Milk Price War which has seen many farmers forced out of our industry. The provision, which will be included in section 46 of the Competition and Consumer Act 2010, will address the current unequal distribution of market power and encourage transparency to the benefit of producers, consumers and retailers.
The commitment by the Federal Coalition Government came only two weeks after QDO and ADF, in partnership with the Alliance of Industry Associations for change to s46, visited Canberra to meet with Treasurer Scott Morrison, Minister for Small Business Kelly O’Dwyer and Deputy Prime Minister Barnaby Joyce.
QDO President, Brian Tessmann said the new provision will prevent firms with substantial market power from engaging in conduct that has the purpose, effect or likely effect of substantially lessening competition.
“The effects test is another tool to help provide integrity and transparency regarding the impact of retailer actions on suppliers,”
“QDO has been very vocal its support for the introduction of the ‘effects test’ as it will deliver direct benefit to our Queensland members.”
ADF President Simone Jolliffe stated that in conjunction with the government’s introduction of the Food and Grocery Code, which included a large number of our recommendations, this is a constructive step toward fostering a more competitive business environment.”
“Further, the appointment of Mick Keogh as the Australian Competition and Consumer Commission’s first Agricultural Commissioner and an Agricultural Engagement and Enforcement Unit, highlights that the government is committed to fostering competition across the supply chain.” In addition the Government has agreed to strengthen Unfair Contract Protection Laws which will assist small business and are set to take affect later this year.
Mrs Jolliffe said the reforms will support consumers’ interests as well as dairy farmers.
“Moving toward a more objective measure to assess the impact of anti-competitive behaviour will build a more open and transparent marketplace,” said Mrs Jolliffe.
QDO and ADF are keen to see this new clause applied as a matter of urgency to see damaging practices, including predatory pricing outlawed.
QDO and ADF thanked the Prime Minister, Deputy Prime Minister, the Treasurer, the Minister for Small Business and the National Party including Senator Matt Canavan for their strong support and action on this important reform.