Australian Competition Minister Craig Emerson has unveiled planned changes to the Trade Practices Act to increase the Australian Competition and Consumer Commission’s powers to stop small-scale acquisitions.
The changes are part of a long-standing election promise that appears aimed at Woolworths, which in recent years has been aggressively acquiring small stores, licences and land across the country. The acquisitions have escaped attention because the individual markets are small, or the deal hasn’t changed the balance of power in that particular market. However, taken overall, they have considerably strengthened Woolworths’ position.
The Government will amend the anti-merger powers to remove the word “substantial” from the “substantial market test”, which means the powers will now apply to any market - local, national, retail or wholesale.
The government will also block a potential loophole that allows acquisitions in the “ordinary course of business”. This has been used by Woolworths to justify land acquisitions. The aim is to stop larger retailers buying all the available sites in a market to prevent competition.