The Australian Competition and Consumer Commission and Video Ezy (A) 2004-5.1

By January 2000, recent price rises at national retailer Video Ezy had prompted public complaints that they were illegally pre-empting the July 2000 introduction of the 10 percent Goods and Services Tax (GST). Charged with enforcing GST price exploitation legislation, the Australian Competition and Consumer Commission (ACCC) launched an investigation. The Commission first sought to negotiate with Video Ezy regarding an appropriate remedy, but talks broke down just over two months before the new tax was due to be introduced. As this was the first case of its kind to confront the ACCC, chairman Allan Fels had to decide the Commission’s next move. Complicating matters was ambiguous legislation and an ongoing internal debate about which law-enforcement approach to take.

This case looks at possible compliance measures, as enforced by the ACCC for which this represented a shift to core business. It can be used to discuss regulation, the political environment, public education campaigns, and changes to agency operations. Part A gives an overview of the ACCC’s role before and after the introduction of the GST and Video Ezy’s initial response to the allegations.

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• The epilogue describes how Allan Fels and the ACCC resolved the issue of alleged price exploitation by Video Ezy in the run up to the introduction of GST in Australia in 2000.