Collective bargaining class exemption

Summary

The ACCC is proposing to develop a ‘class exemption’ that would provide legal protection for:

  • businesses with an annual turnover of less than $10 million in the preceding financial year to collectively bargain with customers or suppliers, and 
  • all franchisees and fuel retailers to collectively bargain with their franchisor or fuel wholesaler respectively regardless of their size or other characteristics

without them having to apply to the ACCC.

A class exemption is a way for the ACCC to grant businesses an exemption from competition law for certain ‘classes of conduct’ that may otherwise carry a risk of breaching competition laws, but:

  • do not substantially lessen competition, and/or
  • are likely to result in overall public benefits.

This class exemption relates to collective bargaining, which is a process that allows competing businesses, such as farmers or retailers, to jointly negotiate with customers or suppliers over common issues (e.g. terms, conditions and/or prices). While collective bargaining may ordinarily breach competition laws, a class exemption would provide a ‘safe harbour’ for eligible businesses to collectively bargain without breaching the competition law. It would operate alongside the ACCC’s existing ‘authorisation’ and ‘notification’ processes, which a business that falls outside the class exemption could still use to seek legal protection on a case-by-case basis.

Next steps

In June/July 2019, the ACCC conducted public consultation on a draft version of the class exemption and associated documents. The submissions received are available below.

The ACCC will now consider submissions and make a final decision about the class exemption.

Initial public consultation

Consultation on draft legislative instrument

ACCC correspondence

Submissions

Consultation on draft legislative instrument

Initial public consultation