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NFF applauds introduction of ‘effects test’

16 March 2016

The National Farmers’ Federation (NFF) has applauded the Federal Government’s introduction of an ‘effects test’ to strengthen Australian competition law and rebalance power for primary producers across the agricultural supply chain.

Announced earlier today by Prime Minister Malcolm Turnbull and Treasurer Scott Morrison, the effects test will be included in section 46 of the Competition and Consumer Act 2010 (CCA) as recommended by the Harper Review. It will replace the existing ‘purpose test’ to shift the onus of consideration from a company’s purpose in undertaking conduct to the effects that conduct can have on competition.

NFF Chief Executive Officer, Tony Mahar, said the effects test had been the subject of significant NFF advocacy efforts given its importance to building open and transparent marketplaces that facilitate high levels of competition.

“This shift towards examining the effects of behaviour will mean a more objective measure to assess the impacts of misuse of market power and anti-competitive behaviour within the supply chain,” Mr Mahar said.

“While we do not view this as a silver bullet solution we do see it as an important tool to not only improve competitiveness but also to drive innovation, productivity and profitability across the sector.

“The test, in conjunction with the appointment of Mick Keogh as the the Australian Competition and Consumer Commission’s first Agricultural Commissioner, most certainly creates a more level playing field for all supply chain participants.

“This has been an advocacy priority for our organisation and we applaud the efforts of the Deputy Prime Minister and the Nationals in also being proponents of the effects test, as well as Treasurer Scott Morrison for being consultative in approach and listening to industry.

“Agriculture has burgeoning global opportunities which, if prioritised accordingly, will be a lead contributor to the national economy. The industry deserves to be positioned as an economic priority, including having a legal framework that facilitates growth and financial gain for all, starting at the very foundation of the sector – the primary producer.”

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