Competition review urges easing of rules on pharmacies and trading hours
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Version 0 of 1. A review of Australia’s competition laws has called for pharmacy regulations to be pared back, the full deregulation of retail trading hours and the removal of import restrictions on books and secondhand cars. The final report of the Coalition-commissioned review also called on the government to reform a “deficient” section of the Competition and Consumer Act dealing with companies that misuse their market power. A further review of taxi regulation was placed on the agenda, but the report stopped short of backing some Coalition politicians’ calls for changes to prevent environmental groups campaigning for boycotts against particular companies. Professor Ian Harper, the economist who headed the review, said the 56 recommendations were “the result of widespread consultation” and aimed to reinvigorate competition to encourage innovation and improve productivity. The recommendation about pharmacy regulation comes at a sensitive time for the government, which is negotiating the next community pharmacy agreement. A recent audit report found major problems with the administration of the previous agreement, reached in 2010. The Harper report, published on Tuesday, called for the removal of restrictions on the ownership and location of pharmacies because they were “not needed to ensure the quality of advice and care provided to patients”. “Negotiations on the next community pharmacy agreement offer an opportunity for the Australian government to implement a further targeted relaxation of the location rules, as part of a transition towards their eventual removal,” the report said. “If changes during the initial years of the new agreement prove too precipitate, there should be provision for a mid-term review to incorporate easing of the location rules later in the life of the next Community Pharmacy Agreement.” More broadly, the report called for the remaining restrictions on retail trading hours to be removed. Such restrictions vary across the states and territories. “To the extent that jurisdictions choose to retain restrictions, these should be strictly limited to Christmas Day, Good Friday and the morning of Anzac Day, and should be applied broadly to avoid discriminating among different types of retailers,” the report said. “Deregulating trading hours should not prevent jurisdictions from imposing specific restrictions on trading times for alcohol retailing or gambling services in order to achieve the policy objective of harm minimisation.” The report also called for changes to parallel import restrictions which “benefit local producers by shielding them from international competition”. It suggested such restrictions could be easily circumvented, pointing to rising online book sales. The report called for the restrictions to be removed unless the benefits “to the community as a whole” outweighed the costs. It also called for urgent review of regulation of the taxi industry, noting the rise of ride-sharing services such as Uber. “Regulation of taxi and hire car services should be focused on ensuring minimum standards for the benefit of consumers rather than on restricting competition or supporting a particular business model,” the report said. The small business minister, Bruce Billson, said the federal government would spend up to 10 weeks consulting on the recommendations before mapping out a way forward. These talks would include the state and territory governments. The report rebuffed calls for an amendment to “secondary boycott” provisions. At present, an exemption allows groups to campaign against companies based on environmental or consumer protection grounds. “The panel did not receive compelling evidence of actual secondary boycott activity falling within the environmental and consumer protection exception,” the report said. “In the absence of such evidence, the panel does not see an immediate case for amending the exception. However, if such evidence arises from future boycott activity, the exceptions should be reassessed.” The report backed the existing “unconscionable conduct” provisions that were cited in recent Australian Competition and Consumer Commission (ACCC) actions against Coles regarding its dealings with suppliers. It said such cases indicated the rules were working as intended, but they should be reviewed if any deficiencies became evident. The report called for changes to “price signalling” rules, which prevent the private disclosure of pricing information to a competitor. These prohibitions apply only to banking services at present. It called for prohibitions against cartel conduct to be simplified, arguing the “excessively complex” rules undermined compliance and enforcement. |