Download Australia's Competition Law: Merger Review, Guidelines, and Private Enforcement and more Slides Competition Law and Policy in PDF only on Docsity! Recent Developments in Competition Law in Australia Docsity.com Overview - Merger review process in Australia • No legislative requirement for notification – Notification advisable in light of ACCC’s power to challenge or block merger – New notification thresholds further entrench a “voluntary” clearance process • Three options for seeking clearance – Informal clearance – no action letter – Formal clearance – application to ACCC with appeal right to Competition Tribunal – Authorization – application to Tribunal that public benefit outweighs any substantial lessening of competition • Formal clearance and authorization confer immunity from challenge – Informal clearance provides no immunity • Informal process preferred – the formal review process has never been used – Flexibility to focus on the real issues, compared with rigid and onerous nature of formal process – Formal process lacks confidentiality – Many of the perceived flaws of the informal process have been addressed Section 50 of the Trade Practices Act prohibits “acquisitions of shares in the capital of a body corporate or the assets of a person where the acquisition would have the effect, or be likely to have the effect, of substantially lessening competition in a market in Australia.” Docsity.com Misuse of market power and predatory pricing • String of failed prosecutions by ACCC for misuse of market power -- particularly for predatory pricing – E.g., Boral v ACCC [2003]: no breach where no evidence of likely recoupment; indicated that firm did not have or take advantage of market power • In 2007, the “Birdsville Amendments” were introduced – Impose additional predatory pricing prohibition on firms with a substantial share of any market: – A firm with a “substantial market share” may not sell “at a price less than the relevant cost” for a sustained period for an anticompetitive purpose. Section 46(1AA) – Substantial market share: Court may have regard to number and size of competitors. Section 46(1AB) • Heavily criticized – “Two track process” for considering predatory pricing : ss.46(1) and 46(1AA) – interaction unclear – Uncertainty created by introduction of concept of “substantial share” • In 2008, further amendments introduced by new Government – Recoupment not necessary to prove predatory pricing – Failed attempt to overturn the market share test A firm with substantial market power shall not take advantage of that power in that or any other market, for the purpose of eliminating or damaging a competitor, preventing entry, deterring or preventing competitive conduct in that or any other market. Trade Practices Act, s.46(1) Docsity.com Private Enforcement • Third parties who suffer “loss or damage by conduct of another person that was done in contravention of a provision of Part IV . . . may recover the amount of the loss or damage by action against that other person or against any person involved in the contravention.” Trade Practices Act, s.82 • Damages are limited to single damages for actual – not potential/likely --loss or damage • Private damages suits for competition cases are infrequent – most enforcement originates from the ACCC • 2008 reforms also included conferring jurisdiction on Federal Magistrates Court power to hear privates suits alleging breach of s.46 (misuse of market power) up to an amount of $750,000 – an attempt to simplify private actions – and make less expensive • Recent vitamins cartel litigation was settled for A$35 M. Docsity.com