I would like to understand this…
According to the ACCC website:
- When businesses communicate and cooperate, they risk damaging competition and breaking the law.
- Businesses that want to join together to negotiate with a supplier or customer through collective bargaining first need permission. This is known as an exemption.
- It’s not illegal to have market power. However, businesses must not misuse this power to stop other businesses competing on their merits.
- When the misuse of market power substantially lessens competition, it is illegal.
- A business risks breaching competition law when it engages in exclusive dealing by restricting how its customers or suppliers do business.
In the case of Netstrata and the building I live in, which you are familiar with, Jimmy, it seems that there is certainly communication and cooperation between them and the developer, and possibly with the supplier of the Embedded Energy system. The question is whether that leads to a misuse of market power.
However, when I think back to the FAGM and the way that the motions were put to the owners, most of us being newbies to strata, my recollection is that there was no critical comment from the newly appointed strata managers as to the alternatives, if any. If that had been a presentation to potential uninformed investors into a public company, there would have had to be a risk disclosure to ensure that investors were suitably educated, I believe.
The question that follows this is, given that embedded network agreements provide benefits to developers while committing the downstream owners to paying for the equipment that is provided to the developer in order for the building to meet BASIX requirements and/or to be certified, shouldn’t the strata manager – Netstrata – inform the unit owners of this.
After all, minutes before at the FAGM, the owners voted to appoint Netstrata as the strata manager, and in doing so, Netstrata took on the role of a fiduciary with the relevant duty of care.
Interested to hear some views on this. It seems to me that it is the FAGM that is the nexus point for behaviours that put owners at a disadvantage. What do other strata management companies do in these circumstances? What is best practice?