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Australian Competition Law Books: A Review
Review of Steinwall, R, et al. Butterworths Australian Competition Law (Sydney: Butterworths, 2000); and Corones, SG, Competition Law in Australia (Sydney: LBC Information Services, 1999)

Author: Weeliem Seah LLB (Hons), BComm, GDLP
Murdoch University School of Law
Issue: Volume 7, Number 4 (December 2000)

  1. From its enactment in the days of the Whitlam Government, the Trade Practices Act 1974 (Cth) has played an important regulatory role in the commercial activities of Australian businesses. However, constitutional limitations initially restricted the application of the anti-competitive conduct provisions of Part IV to corporations. Through the introduction of the Competition Code by the Commonwealth, States and Territories, the 'competition law' component of the Act in Part IV now has a near-universal application to all business entities, regardless of ownership or corporate status. This review looks at two of the leading texts on the Act's regulation of restrictive trading practices. They are Steinwall, R, et al. Butterworths Australian Competition Law (Sydney: Butterworths, 2000) and Corones, SG, Competition Law in Australia (Sydney: LBC Information Services, 1999).

  2. The first thing that a reader will notice about the first text is that it is not written solely by Ray Steinwall. The text's ten chapters are split between Steinwall and six other contributors: John Duns, Kathryn McMahon, Vijaya Nagarajan, Rhonda Smith, Jill Walker and Anne Hurley.

  3. Chapter 1 describes the legislative basis of the Act and provides a fairly detailed description of the history of Australian competition legislation and the 'National Competition Policy'. Each of the subsequent chapters focusing on a substantive Part IV prohibition also provide a legislative history of the subject provision or provisions. Defined statutory terms and phrases are dealt with in detail as are the statutory authorities administering the Act.

  4. Chapter 2 provides the necessary economic background to the Act, dealing with the economic concepts and principles that underlie its operation. Whilst most concepts are very well explained, some, whilst given close examination, rely on the reader having a basic understanding of microeconomics. It is of course not to be expected that in such a text there is an explanation of elementary microeconomic concepts. However, this will force readers unversed in such matters to run to their nearest introductory economics text for assistance. This chapter does have a particularly good section on market definition.

  5. Chapters 3 to 7 cover the substantive provisions of Part IV, each chapter being devoted to a particular prohibition: anti-competitive agreements and boycotts in Chapter 3; misuse of market power in Chapter 4 exclusive dealing in Chapter 5 resale price maintenance in Chapter 6 and anti-competitive mergers and acquisitions in Chapter 7. Chapter 8 addresses the increasingly important issue of access to essential services under Part IIIA of the Act. The text does not deal in detail with the specific telecommunications access regime in Part XIC. Authorisations and notifications for what might otherwise be conduct in breach of Part IV, and matters of enforcement, penalties and remedies are covered in Chapters 9 and 10.

  6. Steinwall follows the traditional approach to legal monographs in stating a proposition of law or commenting about the state of the law and accompanying it with supporting authority. It is not a 'cases and materials' type text, where the author or authors present series of extracts from usually primary and perhaps some secondary material with following questions and commentary. This does mean that there is little extensive quoting and alternative viewpoints are not always given much attention beyond footnoting. However, there are other texts that do such a task, such as Clarke and Corones' Competition Law and Policy: Cases and Materials (Melbourne: Oxford University Press, 1999), and it is not necessarily the aim of this text to provide or engage the reader in such debate. The aim of the text is 'to produce a single comprehensive text that addresses the legal and economic aspects of competition regulation in Australia.' It does achieve this to the extent that a person seeking a prima facie answer to a matter of competition law might well pick it up and find that answer.

  7. Apart from the first two chapters, each chapter generally follows the same basic outline: beginning with a brief introduction to the relevant provision or provisions and addressing each of the essential elements of that or those provisions. Issue coverage is quite comprehensive. For example, in Chapter 4 on misuse of market power, apart from addressing the elementary questions of 'substantial market power', 'taking advantage' and of 'purpose', the text covers situations where a misuse of market power might be alleged. In the Chapter, these include refusals to supply, the imposition of harsh contractual terms and predatory pricing. The Chapter also deals with aftermarkets and network externalities, the essential facility doctrine and the use of contractual or intellectual property rights. Propositions of law are easily identifiable without having to wade through numerous case extracts and facts. This does make the text more suitable to legal and business professionals than the more student-oriented 'cases and materials'. There is generally a good deal of referencing to primary and secondary material - including Australian Competition & Consumer Commission publications - although this does tend to vary somewhat from chapter to chapter depending on the author and the nature of the concepts being examined.

  8. If there is one minor quibble, it is the difficulty that arises out of having so many different authors, each dealing with their own chapter or chapters - there is the potential for inconsistencies between chapters, whether as a result of ideological differences or otherwise. For example, in Chapter 1, the writer notes at page 65 that the court (a Full Federal Court) in General Newspapers Pty Ltd v Telstra Corp (1993) ATPR 41-274 had stated the test for purpose in relation to Section 46 as being ultimately an objective test, though questions of subjective purpose remain relevant. However, in dealing with the issue of purpose under section 46, the writer in Chapter 4 regards purpose as being a subjective test, citing apparently contrary decisions in Eastern Express Pty Ltd v General Newspapers Pty Ltd (1992) 35 FCR 43; 106 ALR 297 and Dowling v Dalgety Australia Ltd (1992) 34 FCR 109; 106 ALR 75, and does not refer to the decision in Telstra.

  9. References to comparative resources are particularly well done, especially to US anti-trust material. Such a text as Steinwall will never however, cover as many different cases as an annotated Trade Practices Act, instead substituting more detail in explanation and comment.

  10. The alternative to Australian Competition Law is Corones' Competition Law in Australia. Its general approach is much the same as Australian Competition Law, commenting upon the state of the law and providing the relevant primary authorities. It aims to provide an 'up-to-date and comprehensive investigation of competition law.'

  11. The first four chapters in Corones cover much the same topics as the first two in Steinwall. Chapter 1 addresses the 'Economic Rationale for Competition Law', looking at the need for competition regulation and the objective of Australian competition law. The explanations of economic principles in this Chapter require more knowledge of economics on the part of the reader than the corresponding chapter in Steinwall. Chapter 2 is titled 'Background and Overview', dealing with early attempts at competition regulation in Australia from the Australian Industries Preservation Act 1906 (Cth) to the enactment of the 1974 legislation. This part is not quite as strong as the Steinwall text in describing the development of restrictive trade practices legislation but excellently provides the US and European approach to competition regulation. Authorisation and notification, and the Act's administration are contained in this chapter as well. The Act's scope, including application to Government bodies, the Competition Code and exemptions, and key concepts and definitions such as market and market power, are considered in Chapters 3 and 4. The treatment of market definition and market power should be singled out as being impressive.

  12. The substantive and procedural provisions of and related to Part IV are contained In the rest of the text from Chapter 5 to Chapter 18. The 'section 45s' are covered in Chapter 5, although there is a focus more on primary boycotts and price fixing. Chapter 6 is a special chapter focusing on horizontal joint ventures and the implications of the Act on such arrangements. Sections 50 and 50A, prohibiting anti-competitive mergers and acquisitions, are covered in Chapter 7. Here Corones has a more detailed treatment of 'failing firm' arguments than Steinwall. Both Steinwall and Corones usefully incorporate the Commission's Merger Guidelines in their commentary. Exclusive dealing and resale price maintenance are covered in Chapter 8 and 9 respectively. Chapters 10 and 11 like Chapter 6, are special chapters not dealing with particular prohibitions, but particular conduct that may be anti-competitive. They deal with franchising and intellectual property licensing respectively. Intellectual property licensing is dealt with in Steinwall in the context of section 46 and the intellectual property exemptions. The chapter in Corones looks at aspects of intellectual property licensing that might fall foul of various Part IV provisions, such as sections 45, 46 and 47. Chapter 12 in Corones on section 46 - misuse of market power - has its own part dealing with intellectual licensing and rights. Chapter 13 is a small chapter dealing wholly with Part XIB, which regulates anti-competitive conduct specifically in telecommunications markets. Access to telecommunications services, Part XIC, has its own separate chapter in Chapter 15 Access to essential services - Part IIIA - is conveniently organised into transport, gas, electricity, water and postal services in Chapter 14. Enforcement and remedies are split between Chapters 16 public remedies, 17 investigation by the Commission, and 18, private remedies.

  13. One appreciable difference between Steinwall and Corones is the highlighting of specific issues in Corones not necessarily covered in the same way in Steinwall. For example, in relation to section 46, apart from examining the basic elements of the prohibition, and the instances in which the prohibition is traditionally raised, including an excellent section on predatory pricing which includes a discussion of the US and European approach, Corones also looks at monopoly pricing, price discrimination, abuse of judicial or administrative processes and share acquisitions and mergers. This flows into the choice of what topics and issues will make up the chapters of the text. As mentioned above, Corones has special chapters focusing on particular conduct relevant to Part IV, including intellectual property licensing and franchising. Importantly, Corones also has chapters focusing, if only in outline, on Parts XIB and XIC. Given what appears to be an increasing prevalence of telecommunications access disputes, having a chapter on the Part XIC access regime is quite useful. Like Steinwall, Corones also has a strong incorporation of overseas experience throughout its commentary.

  14. However, it cannot be said that either text is to be preferred in every instance. There is much commonality between the texts but also substantial differences. Apart from what has already been mentioned, there are differences in the choice of supporting case law, differences in when overseas approaches are discussed, and differences in the detail of coverage afforded to each substantive provision. Whilst one reader might find Corones' treatment of misuse of market power or anti-competitive mergers and acquisitions better, another might prefer Steinwall for its discussion of the authorisation and notification process, or for the anti-competitive agreements and boycotts, and so on.

  15. Ideally, practitioners would have access to both and other resources and the question of which to purchase is irrelevant. It would simply be a case of looking up both texts before moving onto further research. The same could be said for university students who should have both in their university libraries. In any case, students will generally find that it is a 'cases & materials' type text that has been prescribed as part of their required reading. Nevertheless, if a student, having recognised the importance of developing a habit of wide research, wished to purchase one of either Steinwall or Corones to keep at easy reach, it might be kept in mind for those students not particularly familiar with microeconomics that whilst Corones has a wider coverage of issues, Steinwall might be more quickly absorbed so far as the economics of Part IV is concerned. Both texts are to be commended for their contribution to the better understanding of rationales and methods for and of competition regulation. They will no doubt serve as valuable sources of reference that will be regularly used, at least until new editions are released; and it is the dilatory practitioner, business person or student that does not make the time to have a close look at both before acting.

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