Harper response

The Government has published its much anticipated response to the Harper Report. It has deferred consideration of the controversial ‘effects test’ for misuse of market power which has enabled it to sensibly and positively respond to the myriad of other recommendations made by the Harper Committee without distraction.

Most (39) of the Harper Review’s recommendations were supported in full or in principle; a further five were supported in part. The Government has noted or indicated that it ‘remains open’ to the remaining 12 recommendations, including the misuse of market power recommendation which will now be subjected to further consultation.

In relation to the competition laws, the following government reposes were received:

• Cartels
Agreed with recommendation 27 that cartel laws required simplification and to amend the joint venture exemption

• Price signalling
Agreed with rec 29 that separate price signalling laws should be repealed and s 45 amended to include prohibition of concerted practices which SLC

• Exclusionary conduct (primary boycotts)
Agreed the separate exclusionary conduct provision should be repealed in accordance with rec 28

• Exclusive dealing and third line forcing
Agreed third line forcing should be subject to a competition test (rec 32). Recommendations on repeal of exclusive dealing prohibition in s 47 noted and to be considered as part of misuse of market power consultation and general proposal to simplify the laws.

• Resale price maintenance
Agreed per se prohibition should be retained but notification should be allowed (rec 34).

• Mergers
Supported recommendation 35 to combine formal merger clearance and authorisation; exposure draft legislation will be produced.

• Ministerial consent
Agreed with recommendation 26 to remove need for private parties to seek ministerial consent before relying on extraterritorial conduct in private actions

• Authorisation and notification
Supported rec 38 – will be simplified so only single application required per transaction and ACCC can consider both competition and public benefit considerations.

• Block exemption
Supported rec 39 to introduce block exemption power; exposure draft legislation will be produced.

• Admissions of fact
Supported rec 41 that s 83 be amended to extend to admissions of fact.

Julie