Regulation: Australian Business Council report calls for less regulation while another energy company faces penalties for illegal & unconscionable conduct (29 November 2013)

In the past week the Business Council of Australia has released a report, Improving Australia’s Regulatory System, in which it argues for reduction to the cost and burden on regulated parties – “the ‘dead hand’ of regulation imposing unnecessary costs and holding back business investment and job creation”.

The Business Council applauds the strong commitment of the new Liberal-National Federal Government “to improve Australia’s regulation system, including an ambitious target to cut red tape costs by $1 billion”, and notes that the Government “has made a good start with moves to repeal the carbon and mining taxes, and create a one-stop-shop for environmental approvals”.

“The Business Council accepts regulation is important to uphold citizens’ rights and provide legitimate safeguards, but it is not in the community’s interests if it poses unnecessary costs on businesses which reduce their capacity to adapt to change and compete and discourages investment and job creation,” Business Council Chief Executive, Ms Jennifer Westacott, said.

Amongst the Business Council’s suggestions for regulatory improvement is better regulation of the key regulators – by “legislating a new performance and accountability code for all major regulators, including the establishment of an Inspector-General of Regulation”.

The report can be downloaded here.

Meanwhile in other regulatory news, the Federal Court has ordered by consent that Australian Power & Gas Company Limited (APG) pay a penalty of $1.1 million for illegal door-to-door selling practices, following action by the Australian Competition and Consumer Commission.  APG is now owned by AGL Energy Limited (AGL).  Separate to the proceedings, AGL provided the ACCC with a section 87B undertaking that it would extend the operation of its existing Compliance Program to include APG.

The ACCC’s enforcement action in relation to door-to-door selling practices in the energy industry was sparked by a large volume of complaints made to consumer protection agencies. The combined number of complaints received by the various energy ombudsmen during the second half of 2011 was in excess of 2000; while over 1000 complaints were received during the first half of 2012.

In September 2013, the ACCC instituted proceedings against Origin Energy Electricity Limited, Origin Energy Retail Limited and marketing company SalesForce Australia Pty Ltd in relation to their door-to-door selling practices.  The ACCC alleges Origin and SalesForce engaged in unconscionable conduct, undue harassment and/or coercion, and made false or misleading representations to consumers when calling at their homes.  These proceedings are continuing.

In May 2013, AGL Sales Pty Ltd and AGL South Australia Pty Ltd were ordered by consent to pay combined penalties of $1.555 million for false and misleading representations and breaches of the unsolicited consumer agreements provisions.  Marketing company, CPM Australia Pty Ltd, was also ordered to pay $200,000 for its role in the conduct.

In March 2013, the ACCC instituted proceedings against EnergyAustralia Pty Ltd (formerly TRUenergy Pty Ltd) and four marketing and sales companies engaged by EnergyAustralia in relation to alleged false and misleading conduct during their door-to-door selling practices. These proceedings are continuing.

In September 2012, the Federal Court ordered by consent Neighbourhood Energy and its former marketing company, Australian Green Credits Pty Ltd, to pay total penalties of $1 million for illegal door-to-door selling practices.