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Plan raises
serious competition concerns
Caravanning
Queensland's planned 'loyalty
program' may have to be scrapped
Have your say
PLANS by Caravanning Queensland to offer a
"loyalty program" to its members may have to be scuppered, it has been
revealed.
Consumer watchdog ACCC believes it would reduce competition in the supply
of caravanning exhibition event services in state's south east.
The Australian Competition and Consumer Commission today released a
statement saying it proposes not to allow plans by Caravan Trade and
Industries Association of Queensland (Caravanning Queensland) to offer the
program to its members.
"Caravanning Queensland would offer discounted fees to exhibit at its own
caravanning trade shows on the condition that members do not take part in
competing events," it claimed.
"The ACCC intends to revoke an exclusive dealing notification lodged by
Caravanning Queensland about the 'loyalty program' because it raises
serious competition concerns.
“We disagree with Caravanning Queensland's claim that this is simply a
loyalty program for its members," Commissioner Stephen Ridgeway said.
"Loyalty programs should reward members for purchasing more of your
products or services, rather than linking the reward to an agreement not
to purchase your competitors' products or services.
In its draft notice, the ACCC proposes to revoke Caravanning Queensland's
notification because it is satisfied that the proposed ‘loyalty program’
has the purpose and effect of substantially lessening competition in the
supply of caravanning exhibition event services in the South East
Queensland region.
'The likely benefit
would not outweigh
the likely detriment'
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The watchdog said it was also satisfied that
the likely benefit would not outweigh the likely detriment to the public
from the conduct.
Caravanning Queensland has a substantial membership base comprising more
than 85 percent of caravan manufacturers and is the organiser of major
caravanning exhibition events in Brisbane and the surrounding region,
including the must-attend Brisbane Supershow event for caravanning
retailers.
"As a result, smaller caravanning event organisers or possible new
entrants are unlikely to be able to match the deep discounts to persuade
members to give up their Caravanning Queensland discount.
"Additionally, consumers are likely to have fewer opportunities, or have
to travel much further, to attend caravanning exhibition events where they
can easily compare features and prices of a broad range of recreational
vehicles, and track down special deals," Mr Ridgeway said.
Caravanning Queensland and interested parties can comment on the draft
notice before the ACCC makes a final decision, with submissions due by
July 10.
Background
Exclusive dealing occurs when one person trading with another restricts
the other's freedom to choose with whom, in what or where it deals.
Exclusive dealing can take a number of forms, including the supply of
goods or services, or the supply at a particular price or discount, on
condition that the buyer will not acquire, or will limit the acquisition
of, goods or services from a competitor of the supplier.
Exclusive dealing is only a breach of the Competition and Consumer Act
(2010) if the restriction is likely to have the purpose, effect or likely
effect of substantially lessening competition.
Caravanning Queensland lodged the notification with the ACCC on October 3,
2019, and later revealed its initial plans would be to offer a 50 percent
discount on site fees for its 'Let's Go Brisbane' event to members who
participate exclusively in Caravanning Queensland events throughout the
entire year.
Once an exclusive dealing notification is lodged with the ACCC, protection
for the notified conduct beings automatically.
In this case, Caravanning Queensland agreed to not commence the notified
conduct until after the ACCC had assessed its notification.
The ACCC has relied on information gained through a public consultation
process and from internal documents provided by Caravanning Queensland.
The ACCC may only revoke an exclusive dealing notification where it is
satisfied that the notified conduct has the purpose, effect or likely
effect of substantially lessening competition, and in all the
circumstances, will not result in likely public benefit which would
outweigh the likely public detriment.
Before issuing a revocation notice, the ACCC must issue a draft notice
setting out its reasons for proposing to revoke the notification.
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Copyright 2005
Dennis Amor All Rights Reserved
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