Certain conduct which would otherwise breach the anti-competitive conduct provisions of the Competition and Consumer Act 2010 (Cth) (CCA) can, in some instances, be “approved” by the Australian Competition and Consumer Commission (ACCC), pursuant to statutory provisions contained in the CCA.

ACCC approval can be given in a number of ways, namely:

• authorisation;

• notification; and

• for mergers and acquisitions only — formal merger clearance and informal merger clearance.

This overview discusses the statutory processes of authorisation and notification only, as they apply to non-merger conduct. For the processes which apply to mergers which would otherwise breach s 50 of the CCA, see ACCC Clearance.

The ACCC has power to authorise conduct which would otherwise breach the prohibitions on:

• cartel conduct in breach of ss 44ZZRF , 44ZZRG , 44ZZRJ and 44ZZRK (s 88(1A) );

• exclusionary provisions in breach of s 45 (s 88(1) );

• agreements, arrangements or understandings which substantially lessen competition in a market in breach of s 45 (s 88(1) );

• covenants which substantially lessen competition in a market in breach of s 45B (s 88(5) );

• secondary boycotts in breach of ss 45D , 45DA and 45DB (s 88(7) );

• conduct affecting supply or acquisition in breach of ss 45E or 45EA (s 88(7A) );

• exclusive dealing (including third line forcing) in breach of s 47 (s 88(8) );

• resale price maintenance in breach of s 48 (s 88(8A) );

• provisions of dual listed company arrangements which substantially lessen competition in a market in breach of s 49 (s 88(8B) ); and/or

• acquisitions outside Australia of controlling interests in companies which substantially lessen competition in a market in Australia in breach of s 50A : s 88(9).

Authorisation cannot be granted retrospectively. This means that authorisation must be sought before the conduct is engaged in. The only exception is where the conduct is in a contract, arrangement or understanding and the contract, arrangement or understanding has, as a condition precedent, a requirement that ACCC authorisation be granted.

Authorisation is usually only given for a limited time period. Once that time period expires, the conduct will no longer be authorised unless the parties have applied for and been granted a renewal or fresh authorisation.

Section 90 of the CCA sets out the basis upon which the ACCC may grant an authorisation. Put simply, the ACCC must be satisfied that the public benefits of the conduct outweigh its anti-competitive detriment.

The authorisation process is a public one, although commercially sensitive, confidential material can be excluded from the public register. The ACCC is obliged to undertake public consultation in respect of an application. It is also a lengthy process which can take up to 6 months.

Once granted authorisation will apply to all parties to the conduct. This can include future parties where the existence of such parties is identified in the authorisation.

An authorisation can be varied or revoked.

See Authorisation.

Notification is a simpler, faster and cheaper process than authorisation. It provides protection from prosecution for breach of the CCA to the parties involved in the conduct which is the subject of the notification. It is only available for conduct which amounts to exclusive dealing in breach of s 47 of the CCA (including third line forcing) (s 93 ), or for collective bargaining which would amount to cartel conduct in the form of an exclusionary provision: s 93AB .

Like authorisation, notification is a public process which requires the ACCC to be satisfied that the public benefits of the conduct outweigh the anti-competitive detriment. However, notification is a simpler process than authorisation because it works on the basis that the conduct will be “approved” unless the ACCC notifies the applicants otherwise. Where the ACCC decides to withdraw protection it must first give the parties notice of its intention and undertake enquiries to satisfy itself that the public benefits claimed either do not exist or do not outweigh the anti-competitive detriment. The party lodging the notice and any interested parties have a right to be heard by the ACCC before it gives final notice of its decision to withdraw protection. Protection is withdrawn 30 days after final notice is given or such later period as the ACCC determines.

There are some important differences between notifications for exclusive dealing, third line forcing and collective bargaining.

A notification for exclusive dealing other than third line forcing:

• operates to deem the conduct not to have a substantial lessening effect on competition (s 93(7)(a) ); and

• is effective to provide protection from prosecution for breach as of the date it is lodged with the ACCC.

A notification for third line forcing does not become effective as protection from prosecution for breach until 14 days have expired from the date of lodgment.

A notification for collective bargaining:

• is only available in respect of contracts for the supply or acquisition of goods or services by the parties from a “target” of the parties;

• is only available if the party notifying the conduct reasonably expects to make a contract or contracts with the target;

• is only available if the party notifying the conduct reasonably expects that the price of the contract will not exceed $3 million in a 12 month period;

• does not become effective as protection from prosecution for breach until 14 days have expired from the date of lodgment;

• expires 3 years after lodgment; and

• cannot be obtained by trade unions.

See Notification.