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ACCC ‘prolonging RFG investigation’

Competition
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As reported in The Australian newspaper today, Arnold Bloch Leibler competition partner Zaven Mardirossian has written to the ACCC, criticising the regulator for its protracted and vague investigation of the Retail Food Group.

Senior business reporter, Eli Greenblat writes: "In a scathing 23-page letter to Australian Competition & Consumer Commission executive general manager, enforcement division, Rami Greiss, and obtained by The Australian, the law firm representing Retail Food claims the ACCC will find it difficult to get evidence to prove a case and was dragging along the investigation to the harm of all franchisees."

"The high-powered ABL law firm also claimed new Retail Food management had addressed or was addressing all the issues that had caused a scandal around the business years before and the ACCC investigation was only hurting management attempts to resuscitate franchisee earnings as the pandemic hit sales."

The article explains that the ACCC has been investigating the company for about two years, and has recently written to as many as 300 franchisees in a letter that opened with the line, “Hi, how are you doing in this brave new COVID-19 world?”

Zaven's letter to the ACCC describes the communication with franchisees as "seeking to present the ACCC as a ‘friend of the franchisees’ who is able to help them with financial advice so as to assist them during the period of the coronavirus outbreak. This goes far beyond the remit of the ACCC. The ACCC is not a friend of the franchisees. It is a government-funded regulator responsible solely for administering the competition legislation.”

“The clear purpose of the communication — including its highly conversational and informal tone — is designed to solicit complaints from franchisees so as to further the ACCC’s investigation,” Zaven wrote.

“The ACCC is not yet able to frame with any form of precision its allegations against our client.’’

To read the full article, click here.

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