I have reposted this as a separate topic.
Interesting one when IKD issued a "suggested" penalty system; where was the AKA in this! Strange indeed.
The penalty listed un stamped engines; which along with tyres, are my two pet issues. The current practices, which I have covered previously, I believe are potential breaches of the Competition and Consumer Act 2010. The potential breach is in relation to buying one product ( a race meeting) and subsequently being forced to buy another product (engine or tyres) from a defined third party (IKD). I have communicated my views to both the AKA and IKD and advised them to seek a legal opinion; but as yet I am unaware that this has occurred.
Potentially individual clubs are breaching the Act and I suggest any club committee member should raise this issue with the State Associations and the National body. I attach a 2004 case to increase understanding of the issue.
If you have similar concerns it is relatively easy to make a complaint to the ACCC via:
http://www.accc.gov.au/content/index.phtml/itemId/54217#h3_37
If you have concerns that making a complaint can be somehow used against you, then there is a specific section of the act that protects you:
COMPETITION AND CONSUMER ACT 2010 - SECT 162A
Intimidation etc.
A person who:
(a) threatens, intimidates or coerces another person; or
(b) causes or procures damage, loss or disadvantage to another person;
for or on account of that other person proposing to furnish or having furnished information, or proposing to produce or having produced documents, to the Commission, the Tribunal or the AER, or for or on account of the other person proposing to appear or having appeared as a witness before the Tribunal is guilty of an offence punishable on conviction by a fine not exceeding 20 penalty units or imprisonment for 12 months.
Note 1: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.
Note 2: Part IA of the Crimes Act 1914 contains provisions dealing with penalties.
Let's make karting more affordable.
Comments12
Hmmm
Interesting read by ACCC.
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I guess CHOICE is what the ACCC is really about and at the end of the day, karters have a choice as to their decision to race that particular class ? What choices / options are they limiting by enforcing engines and tyres? What savings are made by sourcing alternates as i am guessing your post refers ?
Regards
Dave
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interesting indeed
David, A few comments:
It is not the ACCC but the Competition and Consumer Act 2010, which since 2010 has consolidated both federal and state legislation I believe, and what that act defines as legal.
I am not knowledgable enough to assess whether individual classes with specified tyres and engines is an issue, but you get the feeling from the CAMS case that it might be. However the act enables you to apply for excemption, which is what CAMS was doing. It submitted that having a single source fuel would not be a breach but the ACCC said it was but did then go on to approve the dispensation. They did note that they would prefer a fuel specification rather than a particular brand. It seems to me that the current fuel arrangements in karting may also be potentially illegal. If individual classes with defined tyres and engines were an issue; I am sure that an ACCC investigation into an application would in all likelyhood give it dispensation.
However the current situation goes further than that in defining that the engines and tyres must be purchased through one source. Given that there are plenty of opportunities to obtain engines and tyres from other sources it becomes extremely problematic.If you add to that the defining of the tyre price by the AKA and the issue becomes more problematic.
I should add that Leopard rules also define that engines and tyres are purchased through the one distributor.
I think the act is pretty clear on what is illegal:
Sub-sections 47(6) and 47(7) of the Act specifically prohibit conduct known as "third line forcing" which involves the supply of goods and services on condition that the customer also acquire goods or services from a third party. Third line forcing conduct is currently a per se provision, meaning that it amounts to a contravention of the Act regardless of its affect on competition.
So the activity defined above is illegal whether there is an affect on competition or not; just doing it is illegal.
Regards. David
David Price said:
Interesting read by ACCC.
Â
I guess CHOICE is what the ACCC is really about and at the end of the day, karters have a choice as to their decision to race that particular class ? What choices / options are they limiting by enforcing engines and tyres? What savings are made by sourcing alternates as i am guessing your post refers ?
Regards
Dave
Â
I think its is reasonable to expect every who agrees to race in a class that is controled should be using specified equipment ie a "formula". If a class states purple tires with white walls then every one should have them or if the engine isa wind up clock mechanisum then again every one should have it however people should have a choice where they can buys said purple tires and wind up clock mechanisums. Also that where the formula states what to use it cant then state a mimnimum price for those items as i beleive that is anti competive behavior. If in this case you state purple tires should be used i dont think you can control where those purple tires come from.
But would the pro- tour continue to exist?
Can't see why not.
The economic theory is that a competitive environment increases productivity and reduces consumer costs. Monopolies strangle productivity. The Pro Tour would be forced to increase productivity and reduce costs which gives opportunities for increased participation and further reduce costs. You wonder why the karting industry is one of the few industries that have ever increasing costs and reduced participation rates! The base cost of european equipment should have reduced by 40% over the past four years due to exchange rate; and thats without factoring in productivity improvements that will have occurred over that period.
Its economics 101 and it is why we have a Competition and Consumer Act!
Generically, what incentive is there for cost reductions in a product that can only be sourced from one distributor. Anthony Burke said:
But would the pro- tour continue to exist?
Spot on Damian; but the point I am making is that it is not a belief or view, it is potentially against the law. A law which can impose both fines and imprisonment. Now if I was a club, state or national official I would not play around with that exposure particularly given that there has been a prior conviction and one of the accepted interventions, as well as a fine, was education on the relevant acts!
Unfortunately ignorance is not bliss at this point in time!!!!! Damian Cane said:
I think its is reasonable to expect every who agrees to race in a class that is controled should be using specified equipment ie a "formula". If a class states purple tires with white walls then every one should have them or if the engine isa wind up clock mechanisum then again every one should have it however people should have a choice where they can buys said purple tires and wind up clock mechanisums. Also that where the formula states what to use it cant then state a mimnimum price for those items as i beleive that is anti competive behavior. If in this case you state purple tires should be used i dont think you can control where those purple tires come from.Spot on Damian
I'm confused....because if I'm reading the example you attached correctly, no contrary ruling was made about there being a controlled fuel in the said series; the status quo remained?
I imagine the ACCC would apply similar logic here. Controlled engine and tyres all in the name of keeping costs down...blah blah
The ACCC is a joke. They let Woolies/Caltex and Coles/Shell third line force every day, they have special permission to do so. How the hell it was determined to be good for competition buggers me...
There is no third line forcing with fuel dockets; you don't have to buy the fuel to shop at the supermarkets.
CAMS applied for special dispensation. They submitted as well that what they proposed was not third line forcing. The ACCC said it was and did an investigation to determine whether they would let the dispensation continue. In making there assessment they took submissions from those potentially affected. There decision was to let the dispensation stand. Tony Kay said:
I'm confused....because if I'm reading the example you attached correctly, no contrary ruling was made about there being a controlled fuel in the said series; the status quo remained? I imagine the ACCC would apply similar logic here. Controlled engine and tyres all in the name of keeping costs down...blah blah The ACCC is a joke. They let Woolies/Caltex and Coles/Shell third line force every day, they have special permission to do so. How the hell it was determined to be good for competition buggers me...
eptember 5, 2012 at 12:44
If you dont like it dont race no ones asking you to do anything you dont want to.
eptember 5, 2012 at 12:46
Also I believe you are confusing rules of a competition with rules of comerce your of your nut.