THE AUSTRALIAN Competition and Consumer Commission (ACCC) secured almost $170 million in penalties for breaches of competition and consumer law in the 2017-18 financial year – including fines for Telstra, Ford and Apple – according to its latest annual report.

Significant decisions included the ACCC opposing BP Australia’s proposed acquisition of Woolworths retail service station sites, as well as the decision not to oppose Saputo’s proposed acquisition of Murray Goulburn’s dairy assets following divestiture of its Koroit plant.

The ACCC continued to advocate higher penalties for breaches of competition and consumer laws, and recorded its highest penalty in the Yazaki cartel case of $46 million. This was a case against the major supplier of wiring harnesses used in manufacturing the Toyota Camry. 

The ACCC was also successful in securing penalties of about $10 million each against Telstra, Ford and Apple for consumer protection issues.

“We have been advocating hard for increased penalties for breaches of the Competition and Consumer Act to make boards and shareholders sit up and take notice,” ACCC chair Rod Sims said.

“We will continue to seek higher penalties where we see consumer detriment or deliberate breaches of competition laws. This past year we’ve also welcomed the legislated increase to serious financial penalties available for breaching consumer law, bringing them in line to competition law penalties.”

The ACCC Infocentre received over 290,000 contacts, and visits to the Scamwatch website increased to 2.4 million. Consumers accessed ACCC’s online education resources more than 4 million times, and businesses 1.5 million times. 

Some 281 mergers were assessed in 2017-18: 90 percent were pre-assessed without the need for a public review. The remaining 10 percent – 29 merger matters – underwent a public or confidential review, with 17 unconditionally unopposed.

“While we endeavour to complete these merger reviews as quickly as possible, the focus is on getting the right decision to ensure long-term competitive benefits,” Mr Sims said.

Mr Sims also highlighted the ACCC’s work in the communications sector in 2017-18.

“In this last financial year, we took action on telcos’ misleading broadband speeds advertising and commenced our Measuring Broadband Australia program,” Mr Sims said. “Consumers are now getting much more accurate and transparent information about the speeds they can realistically expect from their internet, and which providers are delivering the fastest speeds.”

The ACCC continued to undertake numerous market studies and inquiries, with reports on the communications sector, dairy industry, new car retailing and retail electricity pricing finalised. Inquiries into digital platforms, residential mortgage products pricing, gas markets and Northern Australian insurance are continuing.

The ACCC also monitors and reports on sectors such as airports, stevedoring, petrol, wheat ports and water.

“The importance of a strong regulatory framework and resolute action by regulators to correct harmful conduct, protect consumers and provide confidence to the public is clear,” Mr Sims said. “The ACCC will continue to work hard to make markets work for the benefit of all Australians.”

The ACCC Annual Report is available on the ACCC website.

www.accc.gov.au

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By Andrew Nicholson >>

ANYONE who has been to Fiji will have been welcomed (enthusiastically) by locals with a hearty greeting of “bula”.

However, shots are being fired over the Pacific as Fijians have become very upset by the proposed use of the term (and their native language) which has been registered as a trade mark in the United States.

It has been reported that tensions have grown in recent weeks after Florida-based Ross Kashtan trade marked the common Fijian greeting for his bar Bula on the Beach, sparking heated online debate and the circulation of a petition seeking to protect the word. 

An online petition reached its 5000-signature target on the day of the Fijian Government's announcement to fight the trade mark.

Fiji's Attorney-General has said that his Government is "shocked and outraged" and has described the use of the bula trade mark as a "blatant case of heritage-hijacking".

He is further reported to have said, "We would never give permission for anyone – particularly someone outside of Fiji looking to profit – to effectively claim ownership of bula, a word so deeply-rooted in our national identity that it has become synonymous with Fiji itself.”

REFERRAL TO WIPO

The Fijian Government has confirmed that the matter will be raised with the World Intellectual Property Organisation (WIPO), which controls the filing of international trade marks. However, as trade marks are registered on a country-by-country basis, that approach may have little impact on the US Patents and Trade Marks Office (USPTO) which governs trade mark registration within the US and which has already accepted the mark.

It appears that the intent of the approach to WIPO is to generate “…some sort of guidelines … so that questions needed to be asked to business people who want to trade mark words, or music, or designs, or whatever they want to trade mark, that it's not theirs”.¹

The Australian Trade Marks Office may have its own matter to address shortly with an application for the mark ‘Bula Beer’ having been filed in June with the following endorsement – the applicant has advised that the English translation of the Fijian words ‘Bula Beer’ appearing in the trade mark is ‘Hello Beer’.

Different countries have their own mechanisms for dealing with indigenous language issues in trade marks.

For example, in New Zealand, a trade mark containing Māori words and symbols must pass through a Māori trade mark advisory committee which advises the Commissioner of Trade Marks whether the registration of a trade mark that is, or appears to be, derivative of Māori text and imagery, is likely to be offensive to Māori.

Trade marks which contain Māori words and symbols are also given a special ‘Māori’ trade mark type status or classification on the Register.

TRADE MARKS ACT 1995

In Australia, the Trade Marks Act requires an examiner to consider whether a trade mark may be offensive or scandalous to a sector of the community, including the Indigenous Australian community in part or at large. 

However, there is no requirement for the applicant to prove that it has obtained the consent of, or consulted with, the relevant Indigenous group.

The situation was highlighted just prior to the recently completed Gold Coast Commonwealth Games, where the mascot’s name ‘Borobi’ was adopted from the indigenous Yugambeh language – translated into English to mean koala.

It was suggested by Jabree Ltd – a registered cultural heritage body for the indigenous Yugambeh people – that allowing the Commonwealth Games Corporation to use the word effectively made the Yugambeh people a “laughing stock” as it indicated that they could not control the use of their native language.

The Yugambeh people opposed the registration of the mark and the matter was resolved by a decision of the Trade Marks Office only weeks before the Games were due to commence. The decision found that:

• there was no inherent restraint on the use of Indigenous words as trade marks;
• even though it was not legally required to do so, the Commonwealth Games Corporation had consulted with the Yugambeh people about the use of the word in a structured and inclusive manner (although there were differing accounts as to whether consent had been given by Yugambeh elders);
• the mark did not create a connotation that the Yugambeh people approved of or endorsed the use of their language by the Commonwealth Games Corporation; and
• the use of the word ‘borobi’ in the context adopted by the Commonwealth Games Corporation was not offensive, shameful or shocking and not scandalous or used contrary to law under the Trade Marks Act.

The examples above are illustrative of the additional considerations which are necessary when adopting indigenous and/or culturally sensitive words as trade marks.

They also highlight (as is the case with all marks) the care which needs to be taken when selecting trade marks and the need to undertake appropriate due diligence and background enquiries to ensure that problems don’t arise.

www.mullinslawyers.com.au

Andrew Nicholson is an intellectual property law specialist and a partner at Mullins Lawyers in Brisbane. Mullins Lawyers is a foundation Industry Expert partner with Queensland Leaders, the organisation fostering the next generation of leading Queensland-based companies.

¹ABC News, 28 September 2018

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BANK BOARDS will have to find new ways to incentivise staff, according to the University of NSW (UNSW) Centre for Law Markets and Regulation (CLMR) director, Dimity Kingsford Smith.

Bringing clarity to the September 28 release of the Interim Report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, Professor Kingsford Smith said remuneration arrangements were crucial in rebalancing the current prominence of the financial voice in banks.

“The Commissioner’s view is that currently much of the misconduct ‘can be traced to entities preferring pursuit of profit to pursuit of any other purpose’,” Prof. Kingsford Smith said. 

“Finding and instilling purposes that motivate bank staff to treat customers well may be the Commissioner’s biggest challenge to bank boards.”

Prof. Kingsford Smith said banks and their executives should also be prepared for more ongoing scrutiny internally and externally on non-financial risk and customer welfare.

She said the interim report showed there was a need for greater focus on the customer, stronger regulatory action and “greater use of sanctions at the higher levels such as civil penalties and even prosecution”.

“Amongst the many questions raised by the Commissioner, are reservations about whether more regulation would be useful, although in areas such as mortgage broking he suggests that legal clarifications would be helpful,” Prof. Kingsford Smith said.

“Rather, he raises many questions, in a climate of sharpened political will for regulatory reform, and better resourcing for regulators.

“Boards used to their banks influencing the regulatory agenda, will have to respond.”

Prof. Kingsford Smith said there would be more external regulatory scrutiny of banks and this would require greater responsiveness to regulatory requirements such as breach notices, and more resources for remediation of customers and faulty systems like misleading website disclosure or fees for no service.

She suggested banks would have to better resource legal compliance, internal audit and risk processes so that these areas could have greater authority over banks’ business units.

“Banks should also scrutinise executive performance on failure to ensure customer financial well-being and bank reputation, and consequences should include haircuts on executive remuneration and even loss of tenure,” Prof. Kingsford Smith said.

“Banks need to ‘do it right, and put it right for customers’ – cost, complexity, broken processes and lack of information are no excuse.

“These problems are all in the control of boards and executive leadership. 

“This includes considering remuneration arrangements so that the mind-set and practices of dealing with customers changes.”

She said banks needed to manage the gap between community expectations of customer treatment and the standards set by the law.

“The Commissioner holds nothing back in his expectation, shared by the community, that banks should comply with the law,” Prof. Kingsford Smith said.

“He and counsel assisting have often asked witnesses, did you understand you were breaking the law? And, to regulators, why did you not enforce the law?

“In his report the Commissioner observes, ‘Compliance appeared to have been relegated to a cost of doing business’.”

Prof. Kingsford Smith said remediation had been tardy and inadequate when risks realise losses to customers.

“The community finds this unacceptable, and the Royal Commissioner seems to share this view.”

www.unsw.edu.au

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