Mackay Chapman April 2025 ACCC Update

In this month’s ACCC update:

• Virgin Australia and Qatar Airways alliance authorised, doubling flights;
• New merger process guidance released for consultation;
• TPG pays penalties for alleged non-compliance with its functional separation undertaking;
• ACCC recommends supermarket reforms to improve competition and consumer outcomes;
• ACCC seeks feedback on draft merger assessment guidelines for new regime;
• Cadell irrigation operator admits to breaching water charge rules; and
• Interim authorisation granted to the Australian Sustainable Finance Institute for discussions on potential capital requirement reforms.

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Virgin Australia and Qatar Airways alliance authorised, doubling flights

The ACCC has authorised a five-year integrated alliance between Virgin Australia and Qatar Airways, increasing the number of weekly return flights between Doha and major Australian cities. 

The partnership will see Virgin Australia using Qatar Airways’ aircraft and crew under a wet lease agreement. This expansion will boost flight capacity, improve connectivity, and reduce consumer prices. 

While concerns were raised about the potential impact on Australian jobs and exclusivity arrangements, the ACCC found minimal public detriment, noting that the overall benefits outweighed any negatives. The new services are scheduled to begin in June 2025.

New merger process guidance released for consultation

The ACCC has released draft guidance on assessing acquisitions under Australia’s new merger regime and is seeking feedback from businesses, advisers, and stakeholders. 

Starting in 2026, all acquisitions meeting certain thresholds must be notified to the ACCC, marking a shift from the current voluntary process. The new guidelines aim to provide transparency and clarity on the process, focusing on ensuring fast approvals for non-controversial acquisitions. 

The consultation period runs until 28 April 2025, and the ACCC expects further updates to the guidance following feedback.

TPG pays penalties for alleged non-compliance with its functional separation undertaking

TPG Telecom has paid $75,120 in penalties after the ACCC issued four infringement notices to TPG Telecom for breaching its joint functional separation undertaking. 

From August 2023 to May 2024, TPG allegedly failed to properly separate its wholesale and retail staff as required, potentially affecting competition in retail broadband services. 

While there was no evidence of sensitive information sharing, the conduct could have harmed competition. The ACCC emphasised the importance of compliance with carrier separation rules to protect consumer choice and competition in telecommunications.

ACCC recommends supermarket reforms to improve competition and consumer outcomes

The ACCC's final report on Australia's supermarket sector makes 20 key recommendations to enhance competition, improve consumer outcomes, and improve supplier conditions. 

The inquiry found that the market, which is largely dominated by Coles and Woolworths, has not been functioning optimally, leading to higher prices and less choice for consumers. The ACCC highlighted concerns around pricing practices, supplier transparency, and barriers to market entry. 

Recommendations include requiring supermarkets to publish prices online, simplifying planning and zoning laws to ease entry for new competitors, and improving transparency in supplier negotiations, particularly for fresh produce. 

The ACCC also suggested stronger supplier protections, more transparent loyalty programs, and greater clarity around pricing changes like 'shrinkflation.' 

ACCC seeks feedback on draft merger assessment guidelines for new regime

The ACCC has released draft merger assessment guidelines for consultation, marking a key step towards implementing Australia's new merger regime, which will come into force on 1 January 2026. 

The guidelines outline the ACCC’s analytical approach to assessing acquisitions, reflecting best practices in competition analysis. Key changes in the regime include considering the cumulative effect of serial acquisitions over the past three years and clarifying that market power is a factor in assessing a substantial lessening of competition. 

While the guidelines are not mandatory until 2026, the consultation process, which is open until 17 April 2025, provides businesses, advisers, and the public with early insight and feedback opportunities. 

The final version will be released before voluntary notifications starting 1 July 2025.

Cadell irrigation operator admits to breaching water charge rules

Cadell Construction Joint Water Supply Scheme Inc, an irrigation infrastructure operator in Southern NSW, has admitted to breaching the Water Charge Rules following an investigation by the ACCC. 

In November 2023, Cadell attempted to backdate a significant increase in fixed charges for its water delivery services, which it was not entitled to do under the rules. The Water Charge Rules require infrastructure operators to provide proper notification of price changes in advance and prohibit the retrospective application of new charges.

Cadell cooperated with the ACCC's investigation and has now provided a court-enforceable undertaking, ensuring future compliance. 

This breach highlights the importance of water businesses adhering to the Water Charge Rules, which are designed to improve pricing transparency and prevent unfair practices in the Murray-Darling Basin.

Interim authorisation granted to the Australian Sustainable Finance Institute for discussions on potential capital requirement reforms

The ACCC has granted interim authorisation to the Australian Sustainable Finance Institute (ASFI) and its member banks to discuss and exchange information to develop proposals for reform to address constraints on sustainable finance and investment in Australia, specifically regarding regulatory capital requirements. 

This authorisation comes with a condition requiring the parties to adhere to a competition protocol for handling competitively sensitive information. 

ASFI is a collaboration involving the Australian financial sector, civil society, academia, and financial regulators. 

The contents of this article do not constitute legal advice and it is not intended to be a substitute for legal advice and should not be relied upon as such.  It is designed and intended as general information in summary form, current at the time of publication, for general informational purposes only.  You should seek legal advice or other professional advice in relation to any particular legal matters you or your organisation may have.