Collective Bargaining Class Exemption

The new class exemption granted by the ACCC for collective bargaining will allow Dealers, through their Dealer Councils, to negotiate with Manufacturers on behalf of their network, without having to go through the previous notification procedures which were administratively burdensome, expensive and time consuming.

Effective as of 3 June 2021, this is an important change which is available to all franchisees under the Franchising Code of Conduct, irrespective of their aggregated turnover. The new provisions represent the first time the ACCC has used its power to grant a class exemption from the competition laws.

“This is a welcome and important development for franchised new car Dealers as it provides a much simpler process for them and their representative Dealer Councils to seek permission to collectively bargain with Manufacturers,” AADA CEO, James Voortman, said.

“We are going through a period of significant change in the automotive industry, and it is more important than ever that Dealers are able to come together and raise their shared concerns with the Manufacturers they are franchised to.”

The collective bargaining exemption came after the Government released reforms to the Franchising Code of Conduct, including specific protections for automotive Dealers. Together these initiatives will deliver greater fairness for Dealers in their commercial agreements with car Manufacturers.

“We are delighted that our members can now utilise this exemption through a simplified process giving them the comfort that they are not potentially breaching competition law,” Mr Voortman said.

“This is a welcome initiative from the ACCC which will foster better relations between franchisees and franchisors.”