House of Representatives

Explanatory Memorandum

Circulated By the Authority of the Assistant Treasurer and Minister for Competition Policy and Consumer Affairs, the Hon Chris Bowen Mp

General outline and financial impact

Criminal penalties for serious cartel conduct

The Trade Practices Amendment (Cartel Conduct and Other Measures) Bill 2008 ('the Bill') amends the Trade Practices Act 1974 ('the TP Act'), the Telecommunications (Interception and Access) Act 1979 ('the TIA Act') and the Proceeds of Crime Act 2002 ('the POC Act') to establish criminal penalties for serious cartel conduct, and to make related amendments.

Date of effect : Cartel criminal offences and parallel civil penalty provisions will commence 28 days after assent, ensuring that those who may be affected by the new provisions and related amendments will have adequate time to consider the provisions prior to their commencement. The remaining amendments made by the Bill (other than the amendments to section 165) commence on the 28th day after the day that the Bill receives Royal Assent. Under transitional arrangements, pre-commencement ACCC authorisations, and pre-commencement collective bargaining notices, that relate to cartels will continue in force.

Proposal announced : On 9 October 2007, the Labor Party made a pre-2007 election commitment to introduce legislation providing criminal sanctions for cartel conduct within 12 months if elected to office.

Financial impact : This Bill has no significant financial impact on Commonwealth expenditure or revenue.

Compliance cost impact : Low. This Bill criminalises conduct that was already prohibited under existing civil prohibitions. There is no ongoing compliance cost impact and a minimal transitional impact on businesses with lawful business arrangements, and the economy more generally.

Summary of regulation impact statement

Regulation impact on business

Impact : Low or no impact. A preliminary assessment has been undertaken and a regulation impact statement is not required, because the regulation impact on business is low.

Main points :

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As noted above, this Bill criminalises conduct that was already prohibited under existing civil prohibitions. There is no ongoing compliance cost impact and a minimal transitional impact on businesses with lawful business arrangements, and the economy more generally.