Competition Law with Dr Julie Clarke: Recent Episodes
Deakin University
Competition Law introduces students to the principal areas of law in Australia which aim to preserve competition in the economy. Attention will focus on the restrictive trade practices provisions of the Trade Practices Act 1974 and their theoretical underpinnings. In particular, it will examine the following topics: the common law doctrine of restraint of trade; the scheme of the Trade Practices Act; trade practices economics; price fixing; anti-competitive arrangements; primary boycotts; exclusive dealing; misuse of market power; resale price maintenance and mergers.
Julie instructs a presentation on mergers. The sections of merges Julie is looking at are predominantly related to sections 50 and 50A. These sections are referred to as structural rather than behavioural prohibitions because they are designed to effectively stop any structural changes within the market.
Elements within section 50 consist of: 1.Corporation, 2. Acquiring Directly or indirectly, 3. Shares or assets in a body corporate, 4. with the effect or likely effect of SLC in a market.
Case 1: Involves TPC v.s Ansett Transport Industries (1978) Issue: Would Ansett by acquiring Avis in a position to dominate the Australian car rental market.
Case 2: Australian Gas Light Co v.s ACCC (2003). Facts: Only case so far on SLC test for mergers.
Section 50A: Relates to International merges and applies to certain acquisitions occurring outside of Australia.
Julie demonstrates the capabilities of authorisation, remedies and procedures. There are a number of authorities which are connected to the trade practices Act including:
- ACCC: enforces the Acts, 2. Tribunal: Limited adjudicative role, 3. CDPP: Criminal cartel prosecution, limited role involved, 4. Courts: Decide on contraventions in most cases, 5. Individuals: Can institute proceedings, Authorisation: Is now accessible for nearly all forms of AC conduct. There remain two different tests including: 1. CAU'S, SLC, cartel conduct and the elite dealings (expect third party line-forcing), the conduct must benefit to the public, 2. For boycotts, mergers and third- line forcing, the conduct perused must result in such a benefit that it should be allowed to exist.
Public Benefit: Has a wide interpretation. ACMA Case: Definition 'anything of value to the community generally'. Efficiencies: These remain the most common claim for mergers and help to enhance economic efficiency.
Officer and Williams argue that the definition comprises benefit to any person.
"Julie illustrates the Access Regime within competition law. The access Regime was introduced in 1995, a part of the national competition party reforms and is a part of 111A TPA. The main apprehension within the Access Regime was the Natural Monopolies including: 1. Electricity, 2. Gas, 3. Telecommunications (which is now a separate regime). All the services which cannot be easily simulated. The Australian government wanted a Regime which there is litigate competition between each of these services without duplicating them.
Other types of implications which fall in the Access Regime include:
- Aviation (access to airports), 2. Shipping (access to ports), 3. Rail (access to tracks), 4. Sewerage network, 5. Digital Radio (which remains under development).
Previously to the access regime of 1995 the only way crucial services could be accessed was by the section 46, to gain access organisations had to demonstrate that not allowing access would convey misuse of market power."
Julie Clarke discusses International Competition Law and explains at the moment there remains no international competitive law. However, a few things are being done in order to continue to:
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Harmonising competition laws. 2. Increasing the enforcement of Competition laws will go around the formal/territorial boundaries of just one state. The international competitive law will help to enhance the potential for global wealth instead of possessing a goal of protecting their national interests. It is easier to share information and to coordinate activities when there are similar policies and procedures put in place, there is also a board desire for an increase in convergence. There are three main international agreements including:
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Bilateral agreements: do not solve problems with conflicting interests.
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Regional agreements: Australia and New Zealand.
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International agreements: Established in 2001, the government of competition regulators have no power to take treaties.
Julie delivers brief content on the Goals of Competitive Law and outlines why we should are, the independent school of thought and the differences between the provisions found within the law which contribute to the concept and Goals of Competitive law.
Examples include:
Efficiency (Chiacagop) School.
Compeition school.
Comparisions of school.
Competition school-Kaysen and Turner.
Hilmer Report.
Julie reveals the issues within the Resale Price Maintenance or price fixing within Competition law: Retail Price Maintenance (RPM) is a form of vertical price fixing (VPF). (VPF) engages different firms in the market place instead of competitors. (VPF) appears when a firm at one level, fixes prices to be charged by a firm at another level example include: 'Retailer purchasing goods from manufacturer on terms fixing price, manufacturer charges other retailers'.
RPM according to TPA is a narrower than the board concept of price fixing. RPM entails a supplier, fixing (or attempting to fix) to resale at the minimum resale price of goods/ services that the goods can supply. The key reasons for organisations/individuals constructing a RPM deceptive scam includes: 1. Prestige & image. ""The attraction of many products to consumers lies in the fact that they are expensive, and have an aura of exclusivity about them"".
Cases: 1. The Heating centre, 2. TPC vs. Penfold wines (1992).
Julie identifies the issue of Exclusive Dealings in competition law. Executive Dealing engages two types of vertical transactions: 1. “Supplying (or acquiring) goods or services on conditions relating to their acquisitions or supply, or conditions relating to other goods or services”. 2. “Refusing to supply or acquire for specified reasons, fox example because a person you are supplying to will not agree to the specific restrictions put in place”. Exclusive Dealing (ED) defined: ""Subject to this section, a corporation shall not, in trade or commerce engages in practices of exclusively dealing"".
Prohibitions Section 47 (2) Supply on condition as to re-supply. The solus agreements consist of: “Supply on condition customer will not acquire like goods or services from another supplier”. This is habitually utilized by suppliers: 1. defends market share, 2. stabilises the market, 3. decrease promotional expenses, 4. Assists enthusiasm for product, 5. Protection from competitors benefitting.
Full Line forcing includes: Supplying goods or services on condition customer will not acquire different goods or services. Supplier’s refusal to deal section 47(3) must not refuse to deal for reason that other person will not agree to certain restrictions.
Julie validates the Misuse of Market Power (MMP)There are two key prohibitions under the heading of (MMP) consisting of:
- Misure of market power (generally): The purpose of section 46(1) Pohibits: 1. The misue of market power by firms having a substantial amount of marketer power. 2. Nature: Single firm offence, no agreement required.
Casesinclude: Voral Besser, Melway & Rural Press.
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Sustained below cost pricing by corporations with substantial market share (""Predatory pricing provisions""): Under the misue of the power of marketing:
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No Recoupment requirement
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No need for substantial market power.
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Poessesing a focus on 'sustained pricing below cost pricing'.
Cases: Leveraging Market power & Imposing restrictive conditions.
Julie outlines the subsequent concerns following Boycotts in competition law, demonstrating what a boycott is, Primary and Secondary boycotts and highlighting the defensive and restrictive measures which need to be taken into account when dealing with these circumstances.
Cases include: Klor's Inc vs. Broadway Hale.
News Ltd.
Hugdes vs. WACA (1986)
News Ltd vs. Australian Rugby Football ledge
ASX vs. Pont Data.
News Ltd vs. South Sydney
Rural Press.
Consequence of breach.
Julie explains all the areas found within Anti Competitive law. Julia summarises the definition and interpretations of how the Anti Competitive law can be perceived. The penalties are explored, when firms collude and outlining the problems with collusion. The purpose of Anti Competitive law is explained and the exceptions found within the law are disclosed.
Cases includes: Dowling vs. Dalgety.
Stationers Supply vs. Vic Authorised Newsagents.
Rural Press vs. ACCC (2003).
Overlap – the over VISY case.
Julia moves into an extensive area of Cartel Conduct. Julie outlines “cartel conduct (agreements between competitors to reduce competition) is bad”. The cartel conduct topic remains a challenging because is explores many provisions which are complex. What constitutes a cartel is explained, the cartel exceptions are also delivered.
Cases include: A-G vs. Adelaide steamship (1913)
The Yarn Spinners Agreement (1959)
British basic slag 1965)
Understanding: News Ltd vs. ARL (1996)
ACCC vs. Leahy (2007).
Julia explores all the basic concepts of what constitutes economics which are covered within the trade practices act. The TPC is based on economic principle. This topic will explore the economic foundation of the trade practices act, the comparison between monopolised and competitive markets and the analysis of the economic concepts throughout the trade practices act.
Cases include: ASX operations vs. Pont Data
Dowling vs. Dalgety (1992).
Mark Lyons vs. Barsill (1987).
TPC Australian Meat Holding (1988).
QIW vs. David Holdings.
Arnotts Ltd vs. TPC (1990).
Julie looks at the outline of Australian Competition law. The constitutional basis will be discussed including: Defining corporations, application to Crown, Indirect application to natural persons.
The competition code will be outlined and discussed.
The structure and approach of the TPA will include: Prohibition conduct, Administration and court structure.
Cases include: Hughes vs. WACA (per Toohey J).
Julie emphasises the competitive law policy of the Restraint of trade is defined as ""certain restrictions on freedom to engage in trade or employment are unenforceable"". The restraint of trade: the test will be presented and the Doctrine in Australia is analised throughout Julie's presentation. The restraint of trade summary will be emphasised within the deliverance of the content and the individual types of restraints will be examined closely.
Cases include: Nordenfelt vs. Maxim Nordenfelt (1984).
Buckly vs. Tutty (1971) 125 CLR 353.
Amaco Australia vs Rocca Bros
Adamson vs NSW Rugby Club (1993).
Julie explores the intricate overview of competitive law and policy throughout the joy of competition, why competitive policy is important, what the competitive policy is providing, Julia will provide a foundation of economic understanding and explores the new developments within the field, the history of competitive law within Australia, focusing on the limitations of common law and presents the TPA reviews and developments.
Julie outlines the Cartel conduct and the resale price maintance law. Julie's key areas of interest consists of the criminalisation of Cartel law since 2009 in Australia and now there remain pushes for New Zealand and the Uk to criminalise the Cartel Law. Julie aspires to conduct further research into the future impact into the cartel criminalisation in Australia and in other places around the world. Another area of interest to Julie is the resale price maintance law, Julie highlights it is an area which has attracted significant interest around the world because of the changes adapted to the culture of the US.
Julie outlines the Cartel conduct and the resale price maintance law. Julie's key areas of interest consists of the criminalisation of Cartel law since 2009 in Australia and now there remain pushes for New Zealand and the Uk to criminalise the Cartel Law. Julie aspires to conduct further research into the future impact into the cartel criminalisation in Australia and in other places around the world. Another area of interest to Julie is the resale price maintance law, Julie highlights it is an area which has attracted significant interest around the world because of the changes adapted to the culture of the US.