Labor will introduce legislation into the Senate today that will help small businesses take cases of anti-competitive behaviour to court.

Currently, small businesses are less likely to take up private litigation against anti-competitive behaviour.

This is because big businesses have deep pockets and armies of lawyers, so the risk of small businesses being overwhelmed and having to pay the big businesses’ legal fees is a significant obstacle.

The Turnbull Government has refused to address this inequity despite the Productivity Commission and the Government’s own Competition Review saying that small businesses are disadvantaged in the court process.

Labor’s Competition and Consumer Legislation Amendment (Small Business Access to Justice) Bill 2017 will restore the balance by letting a small business request a ‘no adverse costs order’ early in a court case.

If the judge decides that the case has merit, the small business will not have to pay the big business’ legal costs.

Labor’s smart legislation will also enable the Australian Small Business and Family Enterprise Ombudsman to provide professional assistance as to whether the ‘no adverse costs order’ is likely to be successful. This is in keeping with the Ombudsman’s current dispute resolution mandate and will help to filter vexatious litigants from the process.

Because Labor is the party of competition policy, our access to justice reforms are based on evidence of what works, unlike the populism relied on by the Turnbull-Joyce government.

We understand that good competition law protects the competitive process, not competitors.

This is why Labor does not support the Turnbull Government’s effects test. Their policy has very little evidentiary support and will not achieve greater competitive balance between small and big businesses.

Instead it will cripple legitimate competition, depress innovation, deter investment and frighten companies from lowering prices on groceries, particularly in regional and remote areas.

Labor is throwing the Prime Minister a lifeline with our access to justice legislation.

With it he has the chance to properly support small business, ditch Barnaby Joyce’s ill-thought through effects test and back in Labor’s policy which will provide access to justice for thousands of small businesses around Australia.


Senator Katy Gallagher is Labor's Shadow Minister for Small Business and Financial Services.

This is a joint release with Labor's Shadow Assistant Treasurer Andrew Leigh MP.