The Competition and Consumer Amendment (Responding to Exceptional Circumstances) Bill 2026 introduces two primary sets of reforms. Schedule 1 establishes a ministerial power to declare "exceptional circumstances" when significant harm to the economy or consumers is likely. This declaration enlivens streamlined ACCC powers to grant class exemptions or authorisations for conduct that would otherwise breach Part IV of the Competition and Consumer Act 2010 (CCA), such as collusion between competitors.
As stated in the explanatory memorandum:
In exceptional circumstances, it is often necessary for businesses to engage in conduct which may risk breaching the provisions of the CCA, even where there is minimal risk to competition, or where the public benefits substantially outweigh those competition risks.These powers are intended to allow rapid responses to crises that fall short of a formal national emergency. Safeguards include a six-month limit on declarations and parliamentary disallowance, though ACCC decisions under these provisions are notably excluded from merits review by the Australian Competition Tribunal.
Schedule 2 increases penalties for contraventions of the Oil Code of Conduct. It introduces a two-tier penalty system for the petroleum marketing industry, aligning it with the franchising and grocery sectors. Maximum civil penalties for bodies corporate are increased to the greater of $10 million, three times the benefit obtained, or 10% of annual turnover. The EM notes that existing penalties
would not provide an effective deterrent... [as] it is open to retailers and wholesalers to weigh the potential benefit of breaching the law against the possible size of the financial penalty.
The primary justification for this Bill is the necessity of regulatory agility in an increasingly volatile global economic environment. By allowing the ACCC to quickly authorise public-interest coordination during "exceptional circumstances," the government can mitigate systemic shocks before they escalate into full-scale national emergencies. This is a clear application of Utilitarian Ground Truth, where the minor risk of temporary anti-competitive conduct is far outweighed by the prevention of widespread economic collapse or consumer deprivation [Judgment].
Furthermore, the reforms to the Oil Code of Conduct address a long-standing weakness in the enforcement of industry standards. For large-scale petroleum distributors, low-level fines are frequently internalised as a mere "cost of doing business." By aligning these penalties with the higher-tier regime found in the franchising and grocery sectors, the Bill restores the Legal Principle of effective deterrence. As the EM argues, significant penalties are necessary to ensure that the financial incentives for non-compliance are removed, thereby protecting the integrity of the market and the interests of consumers [Judgment].
The most concerning aspect of this Bill is the explicit exclusion of merits review for ACCC decisions made under the new "exceptional circumstances" provisions. While the government argues that urgency necessitates this exclusion, it undermines a fundamental Legal Principle of the Australian administrative law system: that significant executive decisions affecting private rights and market competition should be subject to independent review by a body like the Australian Competition Tribunal [Judgment]. Removing this oversight increases the risk of regulatory capture or errors in judgment that cannot be easily rectified.
Additionally, the Bill allows for the retrospective application of declarations and exemptions back to 1 April 2026. Retrospectivity is generally antithetical to the rule of law, as it prevents individuals and businesses from knowing the legal consequences of their actions at the time they are taken. From the perspective of Individual Autonomy, the market functions best when rules are stable and predictable. Granting the Minister broad discretion to define "exceptional circumstances"—a term the Bill leaves to its "natural and ordinary meaning"—creates a high degree of commercial uncertainty and grants the executive undue power to interfere in private economic arrangements [Judgment].
2026-05-13
Senate
Before Senate
Unspecified
Treasury
Competition Policy, Consumer Protection, Energy Policy