Competitive Neutrality in Australia: Time for a Reset?
Rhonda Smith and Deborah Healey
Australian Business Law Review
Rhonda Smith and Deborah Healey, ‘Competitive Neutrality in Australia: Time for a Reset?’ (2023) 50(5) Australian Business Law Review 360
Abstract
Australia's long-established competitive neutrality policy, an aspect of competition policy, focuses on ensuring that government businesses have no advantages over private competitors merely because of their ownership. Implementation has, however, been somewhat imperfect and a comprehensive review in 2015 recommended revitalisation and amendment. This has not been achieved. The OECD issued a formal Recommendation on Competitive Neutrality in May 2021 following much research and discussion. It took a broader approach to the issue than Australia, applying competitive neutrality principles to distorting conduct in relation to all businesses, not just to government businesses. In addition, the Independent Pricing and Review Tribunal in New South Wales is currently undertaking a detailed review of competitive neutrality policy in the State, as was recommended in 2015. In these circumstances, it is timely to reconsider the utility of the current Australian approach and how Australian policy might be amended to comply with the OECD Recommendation. This article shows that solid groundwork on competitive neutrality has been laid in Australia but that the system needs fine tuning going forward in terms both of its utility and its capacity to comply with the OECD Recommendation.