NO.033

ADDITIONAL FUNDING FOR THE ACCC: CRIMINAL CARTEL ENFORCEMENT

The Treasurer today announced as part of the 2006-07 Budget additional funding for the Australian Competition and Consumer Commission (ACCC) and the Office of the Commonwealth Director of Public Prosecutions (DPP) to implement the Government’s decision to introduce criminal penalties for serious cartel conduct, as recommended by the Review of the Competition Provisions of the Trade Practices Act (the Dawson Review).

This measure includes $18.2 million over four years for legal expenses for the ACCC, and $7.2million to support investigations and enforcement.

The measure also includes $4.4 million in funding over four years for the DPP to prosecute criminal cartel conduct cases brought forward by the ACCC.

Funding of $3.9 million over four years will also be provided separately to the Federal Court to enable it to hear trials relating to serious cartel offences under proposed changes to the legislation.

The Government is committed to stamping out serious cartel conduct for the benefit of consumers, and creating a fair, competitive environment for all businesses, including small businesses and those in rural and regional Australia.

CANBERRA

9 May 2006

Contact: David Alexander

(02) 6277 7340

Supporting Information

Why is this important?

• The introduction of criminal penalties for serious cartel conduct is an important step in eliminating this anti-competitive activity.
  • These cases are complex and costly, with high investigative requirements, and the ACCC must be adequately funded to enforce the new cartel criminal offences.
• International experience shows that effective implementation of criminal penalties for serious cartel conduct can be a successful deterrent.

Who will benefit?

• The primary beneficiaries of this policy measure will be Australian consumers, who will benefit from this policy measure through greater choice and lower prices, stemming from a more competitive business environment.
• In addition, all legitimately competitive businesses will benefit from the criminalisation of serious cartel conduct, including small businesses and businesses in rural and regional Australia.

What funding is the Government committing to the initiative?

• This measure includes $18.2 million over four years for legal expenses for the ACCC, and $7.2 million to support investigations and enforcement.
• The measure also includes $4.4 million in funding over four years for the DPP to prosecute criminal cartel conduct cases brought forward by the ACCC.

What have we done in the past?

• In the 2005-06 Budget, the Government provided the ACCC with additional funding of $20million over 4 years to implement and maintain trade practices amendments recommended by the Dawson Review and proposed in the Trade Practices Legislation Amendment Bill (No. 1) 2005.
• In the 2004-05 Budget, the Government provided the ACCC with $46.7million over four years and a $22 million equity injection in 2004‑05 to enable it to effectively deal with an increased number of matters and maintain its levels of service delivery to the community.

When will the initiative conclude?

• Funding for this proposal is ongoing, reflecting the commitment of the Government to create and maintain a fair and competitive business environment.