The Australian Competition and Consumer Commission is giving South Australian potato growers the right to collectively bargain with processors.
The commission says South East Potato Growers Association members can collectively negotiate with McCain Foods Australia Pty. Ltd. and Safries Pty. Ltd. for next year's prices.
It previously allowed Victorian potato growers the same exemption after growers argued there are so few buyers that without collective bargaining they are powerless to get the prices they need to stay in business.
The Trade Practices Act 1974 prohibits anti-competitive agreements, including agreements between competitors that limit their ability to deal with whom they choose or on the terms they choose, including price. Authorization provides immunity from court action under the act and is only given when the commission is satisfied that the public benefit flowing from the conduct outweighs any public detriment.
Commission chairman Graeme Samuel says the association has submitted that potato growers in the South Australian region are typically given standard form contracts by potato processors.
"The ACCC considers that collective bargaining by potato growers may allow them to have greater input into the terms and conditions of their contracts with potato processors, potentially leading to more efficient outcomes," he says.
"The ACCC believes that the possible anti-competitive effect of the collective bargaining arrangement is limited as the proposed arrangement is completely voluntary for all parties. Allowing potato growers to collectively bargain does not reduce the ability of individual growers to negotiate variations on collectively negotiated contracts or to negotiate with a potato processor on an individual basis.