There is no need to change competition laws that have been effective in preventing harmful practices, the Insurance Council of Australia (ICA) says.

In a submission to Treasury, CEO Rob Whelan rejects the Competition Policy Review’s conclusion that section 46 of the Competition and Consumer Act should be modified.

“The insurance council submits that section 46 is well understood and operates effectively in its current form to restrict egregious anti-competitive conduct.”

The review, which was led by Ian Harper and reported last year, concluded section 46 is “deficient’ in dealing with misuse of market power, and proposed changes to simplify and clarify operation of the law.

“[The section’s] sole focus on ‘purpose’ is misdirected as a matter of policy and out of step with international approaches,” the review said.

“Section 46 should instead prohibit conduct by firms with substantial market power that has the purpose, effect or likely effect of substantially lessening competition, consistent with other prohibitions in the competition law. It should direct the court to weigh the pro-competitive and anti-competitive impact of the conduct.”

ICA says the arguments for such changes remain weak, and it is not clear if the intended public benefit will exceed the potential cost of change.

Changing section 46 could instead hurt business innovation.

“This would have damaging repercussions for consumer welfare, because consumers would miss out on consumer product and service innovations,” Mr Whelan said.

“The Insurance Council continues to oppose any proposed legislative or regulatory reform that would constrain legitimate competitive conduct and innovation by general insurance companies.”

The Federal Government will announce its position on the recommendations by the end of next month.