McKenzie questions Barnawartha boycott

18 Dec, 2015 05:00 AM
For us non lawyers out there, a spade is a spade is a spade

VICTORIAN National Party Senator Bridget McKenzie remains sceptical about the competition watchdog’s investigation of the Barnawartha saleyard boycott but is pleased concerns been referred to its new Agricultural Enforcement Unit.

The Australian Competition and Consumer Commission announced last week that its investigation into allegations nine meat processors collectively boycotted the Barnawartha saleyards in February this year had identified competition concerns.

But the inquiry failed to demonstrate that the processors had reached an agreement not to attend the sale.

The inquiry looked into the conduct of the sale due to concerns any agreement or understanding between the processors may have breached the Competition and Consumer Act 2010 (the Act).

Speaking to Fairfax Agricultural Media, Senator McKenzie said she was disappointed there was insufficient evidence to prove “what it seems we all know” about the boycotted sale.

“There was a casual, if you like, coming together of processors to boycott the Barnawartha sale in February this year,” she said.

However, Senator McKenzie said she was encouraged by ACCC chair Rod Sims having expressed concerns about the issue and referred it to the new Agricultural Unit to investigate more closely.

“I know a lot of locals will be disappointed with the ACCC’s decision but having spoken to Mr Sims I know they acquired information from the companies involved in the boycott but did not find the necessary commitment,” she said.

“The ACCC found conversations occurred similar to ‘I’m not going to the sale because they’re not using post-sale weighing’ and the other person said ‘I’m not going either’.

“But that doesn’t count for collusive behaviour and what would have counted was if someone said ‘if you don’t go I won’t go’.”

Senator McKenzie has also spearheaded a Senate inquiry into competition concerns with market consolidation in the red meat supply chain, which was largely sparked by the controversial saleyard boycott in Victoria.

She said the inquiry - which has received 94 public submissions and held public hearings in Roma, Canberra and Albury-Wodonga - had helped “shine a light” on the ACCC’s work investigating the alleged collusion.

The inquiry is due to report on March 16 next year but Senator McKenzie said it had not to date uncovered any evidence that contradicted the ACCC’s finding.

But she said Mr Sims would be recalled to the Senate inquiry to provide more detail of the ACCC’s investigation process and any evidence of issues uncovered.

“I’m sure we’ll be calling back a few processors also,” she said, with further hearings due to be held early next year.

Of the investigation, Senator McKenzie said the ACCC found that a minority of buyers had a good reason not to turn up on the day of the sale.

But she said the majority of buyers did not have a good reason to support their non-attendance.

“For us non lawyers out there, a spade is a spade is a spade and if it walks like a duck and quacks like a duck - it’s a duck,” she said.

“Clearly something is wrong with the sector and the industry and it has been highlighted in the Senate inquiry and it’s great the ACCC has now referred it to the Agricultural Enforcement and Engagement Unit.”

Mr Sims said the key to the investigation was to prove what the processors had been saying to each other and whether that breached any competition regulations.

“We take a lot of cases to court - but at the end of the day you have to get evidence,” he said.

“We’ve probably got evidence but what we found was some cattle buyers had quite legitimate reasons for not turning up; like they had enough cattle and that was clear.

“But with other buyers it wasn’t quite clear why they didn’t turn up and there had been some discussions about the ‘when do we weigh the cattle?’ issue.

“Under our law you need to show not just that there were conversations but some form of commitment was reached.

“I’m not for a second saying that’s a deficiency in our law; I’m simply saying that’s how the law works.

“It’s got to be more than exchanging views about what you’ll do and involve some ‘if you do this I’ll do that’.

“I don’t think it was so much a lack of evidence but what we found didn’t meet the criteria in the law.”

Mr Sims conceded some stakeholders central to the saleyard issue would be disappointed by the ACCC’s decision.

But he said the ACCC would be “treating this as a starting point; not a finishing point” with its referral to the new Agricultural Unit - set-up via $11.4 delivered in the government’s Agricultural Competitiveness White Paper.

The Unit will “take the understanding that we’ve gained of the industry and have a closer look at the red meat industry” he said.

“People will be disappointed with the decision but what we find in our work - and it happens in all sectors not just agriculture – is when people see something happening but they have a couple of data points,” he said.

“They then add one and one and think it adds up to two and they may or may not be right about that - but you still have to meet the thresholds in the law.

“And often people think the thresholds are different to what they actually are or they would prefer different thresholds.

“People will feel there’s still been unfortunate behaviour here and they’d like to think that breaches the law but we’re simply advising that in our view, it doesn’t.

“They may have a different view and I do understand a lot of people who have been concerned about this matter will be disappointed that it doesn’t go further.”

Colin Bettles

Colin Bettles

is the national political writer for Fairfax Agricultural Media
Date: Newest first | Oldest first


18/12/2015 5:25:40 AM

How come we have these bodies who only ever seem to make findings that let corporations off, yet dont tackle high frequency trading, cartels who control oil prices or wholesale funding? Seems to me its one rule for us and another for the big end of town.
21/12/2015 3:43:57 PM

Give them time. They are new and the Commissioner is not appointed yet. I will hold my typing further until we see how they go in the New Year.


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