Council of Small Business of Australia (COSBOA) has expressed deep concern at the existence of a confidential briefing letter provided to the Federal Cabinet from the Business Council of Australia (BCA), arguing against an effects test in competition regulation.

The fact that this letter is confidential and unavailable to the public and other industry groups is highly concerning and COSBOA calls on the BCA to immediately release this letter for scrutiny and comment from other interest groups.

Paul Nielsen, Chairman of COSBOA said today, “We note, as reported in the AFR (24 Sept 15), that the Chairman of the BCA, Catherine Livingstone has provided a confidential eight page briefing letter on 25 August to the Federal Cabinet that spells out the BCA’s case against an effects test, including an attachment containing their views on unintended consequences.

“Whilst we understand the need for secret inter-governmental briefings from departments such as Defence on security matters, the BCA and its members are public companies and competition policy affects the whole business community – not just the big businesses that make up the BCA,” said Mr Nielsen.

Mr Nielsen further questioned whether the clandestine document was provided at the behest of the Government. “If that is the case, has the Government requested a similar briefing letter from organisations with a different view?  So far all anyone has seen from the BCA are assumptions to ‘protect their patch’ and fly in the face of organisations and regulators like the ACCC, who are chartered with protecting and preserving the rights of the whole community, not just big business.

“Given that Competition Policy and the proposed changes to the effects test by the Government’s own Harper Review will affect all businesses in Australia, we are dismayed that the BCA should try and unduly influence Government policy under a sinister cloak of secrecy. What do they have to hide?” asked Mr Nielsen.

Peter Strong, CEO of COSBOA added: “The only comment that we have seen from the confidential briefing from the BCA is that an effects test will ‘put at risk developments such as the iPhone’. The iPhone was developed in a country that has an effects test, the USA. There is an argument that it was because of the effects test that innovators were able to prosper and grow in that country. What other pieces of misinformation are in the BCA’s submission?

“COSBOA, and its members, as well as many regulators, noted economists and the broader community, know the power and influence held by this small number of big businesses is having a hugely negative effect on innovation and productivity in Australia. An effects test will aid the ACCC to make informed assessment of competition and ensure any dominance is good for the economy and not just for a few big businesses,” said Mr Strong.

 

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