Footnotes

Chapter 1 - Introduction

[1]        Journals of the Senate, 2013–14, no. 22 (20 March 2014), pp. 663–64.

[2]        Senate Standing Committee for the Scrutiny of Bills, Alert Digest No. 3 of 2014, March 2014, p. 3.

[3]        Schedule 1, item 1, proposed new subsections 80AD(1) and (2).

[4]        Schedule 1, item 1, proposed new subsection 80AD(3).

[5]        Schedule 1, item 1, proposed new subsection 80AD(5).

[6]        Schedule 1, item 1, proposed new subsection 80AD(4).

[7]        Explanatory Memorandum, p. 2.

[8]        Senator Xenophon, Senate Hansard, 6 March 2014, p. 1016.

[9]        Competition and Consumer Act 2010, s. 2.

[10]      Treasury, Submission 4, p. 5.

[11]      The CCA already includes a divestiture power as a remedy for mergers that contravene section 50 or 50A of the CCA or occurred under clearance or authorisation that was granted on false or misleading information. See Competition and Consumer Act 2010, ss. 81 and 81A.

[12]      Competition and Consumer Act 2010, ss. 4E and 4F.

[13]      Treasury, Submission 4, p. 6.

[14]      Queensland Wire Industries Pty Ltd v Broken Hill Pty Co Ltd (1989) 167 CLR 177 at 188.

[15]      Treasury, Submission 4, p. 6.

[16]      Competition and Consumer Act 2010, s. 76(1A)(b). These penalties were increased in 2006 by the Trade Practices Legislation Amendment Act (No. 1) 2006. Prior to these amendments, the maximum penalty was fixed at $10 million.

[17]      Although subsections 46(1) and 46(1AA) are cited as they are relevant to this bill, section 82 actually applies to any contravention of a provision in Part IV or IVB of the CCA. The action must be taken within six years 'after the day on which the cause of action that relates to the conduct accrued'. Competition and Consumer Act 2010, s. 82.

[18]      Competition and Consumer Act 2010, s. 87(1B).

[19]      Competition and Consumer Act 2010, s. 86E.

[20]      Treasury, Submission 4, p. 5.

[21]      Queensland Wire Industries Pty Ltd v Broken Hill Pty Co Ltd (1989) 167 CLR 177 at 191; cited in Treasury, Submission 4, pp. 5–6.

[22]      Trade Practices Act Review Committee, Review of the Competition Provisions of the Trade Practices Act, 2003, p. 80.

[23]      For a more exhaustive list of inquiries that have considered divestiture, and a useful summary of each inquiry's findings, see Treasury, Submission 4, pp. 10–12.

[24]      Competition Policy Review, 'Terms of Reference', http://competitionpolicyreview.gov.au/
terms-of-reference (accessed 10 July 2014).

[25]      Competition Policy Review, Issues Paper, 14 April 2014, http://competitionpolicyreview.gov.au/files/2014/04/Competition_Policy_Review_Issues_
Paper.pdf (accessed 10 July 2014), p. 40.

[26]      Competition Policy Review, Issues Paper, 14 April 2014, p. 41.

Chapter 2 - Key issues

[1]        Explanatory Memorandum, p. 2.

[2]        Although the committee has not examined these markets, the explanatory memorandum and submissions to this inquiry commented on them. The explanatory memorandum stated: 'there are significant concerns that the lack of competition in these markets is leading to higher prices for consumers and putting producers under increasing financial strain'. ANRA strongly objected to this claim. It stated that the supermarket sector is 'one of the most studied sectors when it comes to competition policy and no substantive evidence has been provided to support the claims that there is a lack of competition in Australia or that there is market failure in the grocery supply-chain'. ANRA argued that intense competition has imposed downward pressure on food prices between 2009 and 2013. Further, ANRA argued that the expansion of the international chains Costco and ALDI 'points to an increasingly competitive market'. ANRA, Submission 2, p. 2. The committee makes no judgment on these competing claims.

[3]        Treasury, Submission 4, p. 7.

[4]        Australian National Retailers' Association, Submission 2, p. 1.

[5]        Treasury, Submission 4, p. 6.

[6]        Treasury, Submission 4, p. 6.

[7]        Treasury, Submission 4, p. 9.

[8]        Competition and Consumer Committee of the Business Law Section of the Law Council of Australia, Submission 3, p. 3.

[9]        Mr Bruce Cooper, General Manager, Strategy, Intelligence, International and Advocacy Branch, ACCC, Proof Committee Hansard, 2 October 2014, p. 13.

[10]      Proof Committee Hansard, 2 October 2014, pp. 13 and 15.

[11]      Proof Committee Hansard, 2 October 2014, p. 14.

[12]      For example, this was the case during the inquiry into the dairy industry conducted by this committee in 2011. See Senate Economics References Committee, The impacts of supermarket price decisions on the dairy industry: Final Report, November 2011, pp. 107–109.

[13]      Law Council of Australia, Submission 3, p. 4.

[14]      Law Council of Australia, Submission 3, p. 3.

[15]      Schedule 1, item 1, proposed subsection 80AD(2). However, the background discussion in the explanatory memorandum refers only to the reduction of market share. See Explanatory Memorandum, p. 1.

[16]      Ms Caroline Coops, Chair, Competition and Consumer Committee, Law Council of Australia, Proof Committee Hansard, 2 October 2014, p. 1.

[17]      Trade Practices Act Review Committee, Review of the Competition Provisions of the Trade Practices Act, 2003, pp. 162–63.

[18]      Mergers that contravene section 50 or 50A of the CCA or occurred under clearance or authorisation that was granted on false or misleading information. See Competition and Consumer Act 2010, ss. 81 and 81A.

[19]      Similarly, in its submission to this inquiry, Treasury noted that divestiture can be a 'natural solution' to a merger that resulted in a substantial lessening of competition, as 'the pre-merger structural state of the market is a state the court can return to via use of the remedy, though it is not always possible to "unscramble" a transaction post-acquisition'. Even so, Treasury noted in that context the power has been rarely used. Treasury, Submission 4, p. 8.

[20]      Trade Practices Act Review Committee, Review of the Competition Provisions of the Trade Practices Act, 2003, p. 162.

[21]      Trade Practices Commission v Australia Meat Holdings Pty Ltd (1988) 83 ALR 299; cited in Treasury, Submission 4, p. 8. See also Mr Bruce Cooper, General Manager, Strategy, Intelligence, International and Advocacy Branch, ACCC, Proof Committee Hansard, 2 October 2014, p. 12.

[22]      United States of America v Microsoft Corporation, United States Court of Appeals, No. 00‑5212, 28 June 2001, www.justice.gov/atr/cases/f257900/257941.htm (accessed 22 August 2014).

[23]      United States of America v Microsoft Corporation, United States Court of Appeals, No. 00‑5212, 28 June 2001.

[24]      Mr William Reid, Member, Competition and Consumer Committee, Law Council of Australia, Proof Committee Hansard, 2 October 2014, p. 5.

[25]      Law Council of Australia, Submission 3, p. 4. These cases involved a steel manufacturer, a power distribution business, a street directory publisher and a rural newspaper publisher.

[26]      Law Council of Australia, Submission 3, p. 3.

[27]      Mr Brian Cassidy, Chief Executive Officer, ACCC, Senate Economics References Committee Hansard, Inquiry into competition in the Australian banking sector, 25 January 2011, p. 56.

[28]      Law Council of Australia, Submission 3, p. 5.

[29]      Law Council of Australia, Submission 3, p. 5.

[30]      Proposed subsection 80AD(5) would allow the court to accept an undertaking by the corporation to take particular action to reduce its market power or share as an alternative to a court order.

[31]      Law Council of Australia, Submission 3, pp. 5–6.

[32]      Australian National Retailers' Association, Submission 2, p. 3.

[33]      Australian National Retailers' Association, Submission 2, p. 4.

[34]      Proof Committee Hansard, 2 October 2014, p. 3.

[35]      Law Council of Australia, Submission 3, p. 4.

[36]      Mr Joel Silver, Submission 1, pp. 4–5

[37]      Independent Committee of Inquiry into Competition Policy in Australia, National Competition Policy, 1993, p. 164; cited in Treasury, Submission 4, p. 9.

[38]      Mr William Reid, Proof Committee Hansard, 2 October 2014, p. 5.

[39]      Treasury, Submission 4, p. 9.

[40]      Australian Competition and Consumer Commission v Cement Australia Pty Ltd [2014] FCA 148.

[41]      Mr Bruce Cooper, General Manager, Strategy, Intelligence, International and Advocacy Branch, ACCC, Proof Committee Hansard, 2 October 2014, p. 12.

[42]      Mr Joel Silver, Submission 1, p. 4.

[43]      Law Council of Australia, Submission 3, p. 4.

[44]      Trade Practices Act Review Committee, Review of the Competition Provisions of the Trade Practices Act, 2003, pp. 162–63.

[45]      Independent Committee of Inquiry into Competition Policy in Australia, National Competition Policy, 1993, p. 164; cited in Treasury, Submission 4, p. 9.

[46]      Australian National Retailers' Association, Submission 2, p. 3.

[47]      Australian National Retailers' Association, Submission 2, p. 3.

[48]      Treasury, Submission 4, p. 8.

[49]      Australian National Retailers' Association, Submission 2, pp. 2–3.

[50]      Treasury, Submission 4, p. 9.

[51]      Law Council of Australia, Submission 3, p. 4.

[52]      Australian National Retailers' Association, Submission 2, p. 3.

[53]      Australian National Retailers' Association, Submission 2, p. 3.

[54]      SPAR Australia, Submission 5, p. [4].

[55]      SPAR Australia, Submission 5, p. [2].

[56]      Australian National Retailers' Association, Submission 2, p. 1.

[57]      SPAR Australia, Submission 5, p. [6].

[58]      SPAR Australia, Submission 5, p. [6]. Private enforcement of section 46 is available and has occurred in a number of cases.

[59]      SPAR Australia, Submission 5, p. [6].

[60]      SPAR Australia, Submission 5, p. [7].

[61]      Mr Jos de Bruin, Chief Executive Officer, Master Grocers Australia and Liquor Retailers Australia, Proof Committee Hansard, 2 October 2014, p. 9.

[62]      It is envisaged an effects test would capture conduct that had the effect or likely effect of substantially lessening competition, but could not be shown to have been for one of the three proscribed purposes. See ACCC, Submission to the Competition Policy Review, June 2014, http://competitionpolicyreview.gov.au/files/2014/06/ACCC.pdf (accessed 20 August 2014), pp. 76–80. See also Proof Committee Hansard, 2 October 2014, p. 13.

[63]      Competition Policy Review, Draft Report, http://competitionpolicyreview.gov.au/files/
2014/09/Competition-policy-review-draft-report.pdf (accessed 22 September 2014), p. 211.

[64]      Competition Policy Review, Draft Report, http://competitionpolicyreview.gov.au/files/
2014/09/Competition-policy-review-draft-report.pdf (accessed 22 September 2014), p. 44.

[65]      Proof Committee Hansard, 2 October 2014, pp. 13 and 15.

Dissenting Report by Senator Nick Xenophon - Competition laws – the butter knife needs to be replaced with a sword of Damocles

[1]        Explanatory Memorandum, p. 2.

[2]        Master Grocers Australia, Submission 6, p. 5.

[3]        Master Grocers Australia, Submission 6, p. 8.

[4]        Mr Jos de Bruin, CEO, Master Grocers Australia, Proof Committee Hansard, pp. 9–10.

[5]        SPAR Australia Ltd, Submission 5, p. 3.

[6]        Competition Policy Review, Draft Report, September 2014, http://competitionpolicyreview.gov.au/files/2014/09/Competition-policy-review-draft-report.pdf (accessed 25 February 2015), p. 206.

[7]        Ibid, p. 210.

[8]        Ibid, p. 210.

[9]        Ms Caroline Coops, Chair, Competition and Consumer Committee, Law Council of Australia, Proof Committee Hansard, p. 1.

[10]      Mr William Reid, Member, Competition and Consumer Committee, Law Council of Australia, Proof Committee Hansard, p. 4.

Additional Comments by Senator Canavan

[1]        ACCC, Court finds Coles engaged in unconscionable conduct and orders Coles to pay $10 million penalties, 22 December 2014, Media Release.

[2]        Mitchell and Durkin, Coles to settle unconscionable conduct cases with ACCC, Financial Review, 15 December 2014.

[3]        Productivity Commission, Regulator Engagement with Small Business, Research Report, 2013.

[4]        Productivity Commission, Annual Report 2007–08, 2008.

[5]        Productivity Commission, The Productivity Challenge and Innovation, Media Release,
31 October 2008.