Effects test a win for primary producers and small businesses

WAFarmers approves the Federal Government’s decision to introduce an ‘effects test’ which will see farmers and primary producers have greater power along the supply chain.

The effects test, based on a recommendation from the Harper Competition Policy Review, will replace the existing ‘purpose test’ thus shifting the emphasis from a business’ purpose in undertaking conduct to the effects that conduct will have on competition.

Prime Minister Malcolm Turnbull made the announcement at a joint-party meeting yesterday and acknowledged the plan would ensure that smaller businesses would be better placed within a competitive market.

“What this will do is ensure that our competition law works better to enable competition, to enable smaller businesses, emerging businesses, to be better able to compete,” Mr Turnbull said.

WAFarmers President Tony York agreed with Mr Turnbull’s comments, stating that fairness in competition and market share continued to be a key priority for farmers and producers.

“The proposal will go a long way in protecting small businesses such as farm businesses from exploitative behaviours sometimes demonstrated by larger companies,” Mr York said.

“By shifting the consideration from purpose to effects, businesses are forced to deliberate on issues that they might not have considered otherwise when only looking at the first step in the process.

“Like our national peak body, the National Farmers’ Federation, we anticipate that the changing of the law in conjunction with the appointment of Mick Keogh as Agricultural Commissioner will see greater fairness along the supply chain.

“As agriculture is the only pillar of the Australian economy which has the potential to double by 2030, it is critical that competition issues are worked out to ensure primary producers are able to compete fairly within the market, and we believe that this is another step in the right direction towards achieving this outcome.”


All media requests must be directed to WAFarmers Media and Communications Officer Melanie Dunn on (08) 9486 2100 or [email protected].


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