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ANZ cleared of mortgage price fixing

by Huntley Mitchell4 minute read

The full bench of the Federal Court of Australia has dismissed an appeal by the Australian Competition and Consumer Commission (ACCC) regarding price fixing allegations involving ANZ home loans.

The court proceedings concerned allegations in 2004 by the ACCC that ANZ had entered a price-fixing agreement with Mortgage Refunds Pty Ltd to limit the refund it could provide to its customers when arranging ANZ home loans.

The consumer watchdog alleged that ANZ made and gave effect to an agreement where it would only allow Mortgage Refunds to continue to be accredited to offer ANZ mortgage products if it agreed to limit any refund it paid to its customers to $600. This would have allowed ANZ branches to match the deal if they chose to waive the bank’s loan establishment fee.

The ACCC alleged that this amounted to price fixing – and was a clear breach of the then Trade Practices Act 1974 (now known as the Competition and Consumer Act 2010) – because ANZ and Mortgage Refunds were competitors in the market for the provision of loan arrangement services to customers.


On 18 November 2013, the Federal Court found that ANZ did not participate in a market for the provision of loan arrangement services, and consequently that ANZ and Mortgage Refunds were not competitors in this market.

As a result, ANZ’s conduct was found not to amount to a price fixing agreement and the ACCC’s application was dismissed.

In the latest judgement handed down on Friday, the full bench dismissed the ACCC’s appeal, agreeing with the trial judge that ANZ branches did not supply loan arrangement services, and that ANZ did not compete with independent mortgage brokers, including Mortgage Refunds.

In addition, the full bench allowed ANZ’s cross appeal, finding that the Mortgage Refunds' payment could not be considered to be a ‘rebate’ for the purposes of the price-fixing provisions in the act.

ACCC chairman Rod Sims said the consumer watchdog brought the court proceedings “because of its concern that what should have been a competitive rivalry for new customers was undermined by ANZ’s decision to restrain the broker’s ability to compete on price”.

“Although the full court did not accept that ANZ was in competition with independent mortgage brokers, it is important to note the full court observed that it is possible for internal and external distribution channels to be in competition, and that each case needs to be considered on its own facts and circumstances,” he said.

[Related: ACCC takes second swipe at ANZ]

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