ACCC reports on authorisation competitor collaborations during COVID-19

The Australian Competition & Consumer Commission (ACCC) has released a new COVID-19-related authorisations report describing its approach to authorise competitor collaborations and how the approach served the Australian economy during crisis.

In six weeks from mid-March 2020, ACCC received 33 applications for authorisation of competitor collaborations to address the disruptions and risks arising from the pandemic. It also deployed substantial resources and used streamlined processes to grant interim and final authorisations quickly.

“The ACCC recognised that during the extraordinary times at the height of the pandemic, our role in authorising what would normally be anti-competitive conduct would be crucial in helping particular industries meet the needs of the Australian public,” said ACCC Chair Rod Sims.

“A year ago, no one knew the degree to which COVID-19 would affect Australians' everyday lives and the extent to which collaboration would be needed in critical sectors like health, food supply, and aviation. As the extent of the crisis became clear, however, the ACCC saw the need for agile and flexible decision-making in response to the sudden surge in exemption applications.”

At the time of publishing the report, the regulator considered three applications to extend, particularly COVID-19-related authorisations that would otherwise have expired on March 31, 2021:

• from Private Healthcare Australia (PHA) concerning broadening private health insurance and relief related to the pandemic, including particularly the release of deferred claims lability as health services resume;
• from 7-Eleven concerning arrangements to close or reduce the hours of some of its retail stores due to ongoing low demand; and
• from Coles on behalf of supermarkets to continue their preparedness for future lockdowns and other responses to the pandemic.

However, ACCC clarified that it declined to grant interim authorisation to PHA for elements that would have broadened the scope of conduct authorised, including regarding the release of deferred claims liability.

The applicants were unable to satisfy the ACCC – for its decision on interim authorisation – that such broadening was merited when set against the benefits from allowing competition and unilateral decision-making to determine outcomes. On April 08, 2021, PHA withdrew its application for an extension of its authorisation.

The ACCC will now consider the two remaining extension applications and proceed to draft and final determinations according to its usual statutory processes. Twenty-one other authorisations remain, expiring by September 30, 2021.