Australia's competition regulator has flagged it will seek larger penalties against big companies this year in order to effectively deter them from misconduct.
The Australian Competition and Consumer Commission plans to focus on unfair contracts for small businesses, and to target cartels and misconduct by large businesses in the health, construction and agriculture sectors, as part of its priorities for 2017.
"One issue that continually emerges is whether the penalties against large businesses are enough of a deterrent and more than just the cost of doing business," chairman Rod Sims said at a Committee for Economic Development of Australia (CEDA) event in Sydney.
Mr Sims said companies that breach competition or consumer law don't acknowledge the seriousness of the issues, often because current civil penalties are too low.
"In 2017 we will be making concerted efforts to ensure that penalties we seek make larger companies and individuals who work in them consider their business practices, and how their business practices meet their obligations under competition and consumer law," Mr Sims said.
Mr Sims said he was heartened by comments from judges about relatively light fines in recent ACCC cases involving Reckitt Benckiser, and ANZ and Macquarie Banks.
He acknowledged that pushing for harsher punishment could initially lead to fewer agreed settlements.
The regulator will also continue to advocate for legislative penalties under Australian Consumer Law (ACL) that effectively deter larger businesses from misconduct.
At the top of its priorities for the year would be taking a number of big businesses to court, for subjecting small businesses to unfair contract terms.
The federal government in November introduced new laws to protect small businesses, preventing large companies from putting unilateral terms in their standard contracts.
"We have seen how the treatment of suppliers by supermarkets, and dairy farmers by milk processors, can cause widespread anger and frustration," Mr Sims said.
Other areas being targeted for enforcement will be the health, construction and energy sectors.
ACCC last year took private health insurer Medibank to court for misleading customers over changes to benefits, and has promised a further crackdown in 2017.
It has also set up a new investigative unit focused on commercial construction to tackle competition issues in the sector and said it plans to put additional resources towards new investigations.
The regulator also has ongoing inquiries in both the agriculture and energy sectors.
ACCC will also broaden the scope of its work in relation to consumer guarantees, particularly focused on practices in the airline, telecommunication and motor vehicle industries.
Mr Sims said given the given the wide scope of its activities and limited resources, the regulator's focus will increasingly gravitate towards larger businesses as their footprint and impact will be more significant and influence on market behaviour more telling.
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