NO.086

WORKING PARTY TO EXAMINE CRIMINAL SANCTIONS FOR CARTEL BEHAVIOUR

The Treasurer today announced terms of reference for an officials’ working

party to consider whether appropriate criminal offences for cartel behaviour

can be introduced into Commonwealth law.

The working party will examine matters, identified by the Review of the Competition

Provisions of the Trade Practices Act 1974 (Dawson Review), that should be resolved

before criminal sanctions can be introduced. These include determining an appropriate

definition for any proposed offence, and a workable method of combining a clear

and certain leniency policy within the criminal regime.

On 16 April 2003, the Government announced its in principle acceptance of the

recommendation of the Dawson Review, that criminal sanctions be introduced,

subject to further consideration of these issues.

The working party will comprise officials from the Treasury, the Attorney-General’s

Department, the Australian Competition and Consumer Commission and the Commonwealth

Director of Public Prosecutions.

The working party is expected to report to the Treasurer by the end of 2003.

Terms of reference are attached. The Committee will take into account submissions

to, and the discussions of, the Dawson Review. Should interested parties wish

to provide additional material, submissions should be forwarded by the end of

November to:

Working Party on Penalties for Cartel Behaviour

C/- Department of the Treasury

Langton Crescent

PARKES ACT 2600

MELBOURNE

3 October 2003

Contact: Michael O’Brien

Treasurer’s Office

(03) 9650 0244

Working Party on Penalties for Cartel Behaviour

Terms of Reference

Having regard to Recommendation 10.1 of the Review of the Competition Provisions

of the Trade Practices Act 1974 and the Commonwealth Government response, the

working party is to consider and report on whether an appropriately defined

criminal offence or offences can be introduced into Commonwealth law proscribing

some or all of the activities that comprise cartel behaviour.

More specifically, the working party’s consideration of this matter is to

include a consideration of:

• the activities that comprise cartel behaviour and the provision of a workable

  definition of such behaviour, having regard to the definitions used in other

  jurisdictions and by the OECD;

• feasible options for criminalising cartel behaviour, including recommendations

  as to the elements of any offence;

• whether, and to what extent, any proposed offence might overlap with existing

  civil prohibitions and whether any measures (legislative or otherwise) are

  required to manage this overlap;

• the appropriate maximum penalties for any proposed offence;
• any appropriate defence against, or exemptions from, a proposed offence;
• the development of a clear and certain leniency policy, having regard to

  the operation of leniency policies in other jurisdictions; and

• how investigative, prosecutorial and other relevant legal processes might

  be used or might need to be modified to ensure the effectiveness of any proposed

  offence.

In undertaking this task, the working party is to examine relevant factors

including, but not limited to, the following:

• the role of criminal penalties as an effective deterrent to cartel behaviour;
• the economic effects of cartels and penalising cartel behaviour;
• the impact of any proposed penalties on business;
• the detection of cartel behaviour;
• similar offences in other jurisdictions and the implications for Australia

  of other jurisdictions’ experiences;

• the transparency and accountability of investigative and prosecutorial

  agencies;

• the compatibility of any proposal with existing Australian approaches to

  law enforcement; and

• issues raised in the Review of the Competition Provisions of the Trade

  Practices Act 1974.