The Australian Competition and Consumer Commission (ACCC) can ‘authorise’ businesses to engage in collective negotiations when it is satisfied the public benefit outweighs any public detriment, including from any reduced competition. BARA’s activities are pro-competition because they help international airlines enter the market in Australia and foster commercial opportunities. But it’s important industry organisations like BARA operate within clearly defined boundaries.
The ACCC has granted BARA authorisation for two five-year terms since 2005. In October 2014, BARA applied for re-authorisation, and the ACCC granted it for 10 years until 2025.
What can BARA do?
BARA can pursue voluntary and non-binding negotiations on behalf of its member airlines. This means the supplier and airlines both need to agree to BARA being part of the negotiations. It also means BARA doesn’t bind its member airlines to any outcomes that it reaches with suppliers, so the members have to decide whether to accept the prices and terms BARA has negotiated for them.
BARA can collectively negotiate with all the leading providers of essential aviation services to international airlines, namely:
Under certain conditions, the ACCC has also authorised BARA to request industry-wide tenders for the security services that the Australian Government mandates and which the airlines have to provide. This allows BARA to facilitate the timely and efficient provision of such security services.
Net public benefits
BARA’s collective negotiation activities generate benefits for airlines, suppliers and ultimately the travelling public. The benefits include:
The ACCC’s assessment concluded that BARA’s activities generate net public benefits. It noted that BARA’s collective negotiations have been in effect for nearly 10 years since authorisation was first granted in 2005, and the ACCC has not received any complaints relating to BARA’s conduct.
BARA continues to engage positively with suppliers, and seeks outcomes that boost the industry’s productivity and the value it can generate for the Australian economy and community. BARA’s authorisation provides the legal foundation to achieve these outcomes. BARA appreciates the ACCC’s decision to grant a 10-year authorisation, which reduces compliance costs and provides it with long-term operating certainty.
BARA’s full submission to the ACCC can be downloaded here DOWNLOAD