Chris Bowen (Prospect, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

I move:

That further amendments (1) to (6) be agreed to:

(1)    Schedule 1, page 3 (before line 6), before item 1, insert:

1A  After subsection 46(1)

Insert:

(1AAA)   If a corporation supplies goods or services for a sustained period at a price that is less than the relevant cost to the corporation of supplying the goods or services, the corporation may contravene subsection (1) even if the corporation cannot, and might not ever be able to, recoup losses incurred by supplying the goods or services.

(2)    Schedule 1, item 4, page 3 (lines 19 and 20), omit the item.

(3)    Schedule 1, page 3 (before line 21), before item 5, insert:

4A  Subsection 46(4A)

Omit “Court” (wherever occurring), substitute “court”.

(4)    Schedule 2, page 5 (before line 6), before item 1, insert:

1A  After subsection 46(1) of the Schedule

Insert:

(1AAA)   If a person supplies goods or services for a sustained period at a price that is less than the relevant cost to the person of supplying the goods or services, the person may contravene subsection (1) even if the person cannot, and might not ever be able to, recoup losses incurred by supplying the goods or services.

(5)    Schedule 2, item 4, page 5 (lines 19 and 20), omit the item.

(6)    Schedule 2, page 5 (before line 21), before item 5, insert:

4A  Subsection 46(4A) of the Schedule

Omit “Court” (wherever occurring), substitute “court”.

I present a supplementary explanatory memorandum to the bill. Accepting the Senate’s amendments necessitates the government moving its own amendments to the bill to ensure that it continues to effectively address predatory pricing. Simply accepting the Senate’s amendments would have had the consequence of removing one of the key amendments of the bill—the clarification of the role of recoupment under section 46. To rectify this, the government’s amendments reinstate the government’s proposed recoupment amendment. The reinstated provision ensures that where an action relies on an allegation of sustained below cost pricing under subclause 46(1), it will not be legally necessary to prove recoupment. This was necessitated by the decision of the High Court in the Boral case. It has been called for for a long time since that case. Almost every expert commentator thinks that these are appropriate amendments. They are amendments that the previous government failed to make despite recommendations from the Senate committee to do so. They are amendments that the previous government abjectly neglected to introduce despite the fact that the failure to do so effectively neutered section 46. This government is not prepared to do that and we are certainly not prepared to accept an opposition amendment which does that now.

Secondly, accepting the Senate’s amendments necessitates amending the bill so that it would no longer repeal section 46(4A). That subsection presently ensures that the court may consider allegations of predatory pricing under section 46(1). The bill would have rendered section 46(4A) redundant by creating a specific prohibition against predatory pricing by corporations with substantial market power. However, accepting the Senate’s amendments necessitates the retention of subsection 46(4A).

Finally, the equivalent amendments to those outlined above are made to the provisions of the bill which amend the Competition Code. The Competition Code contains the version of section 46 that applies to all persons in the states and territories by virtue of application of legislation in those jurisdictions. Despite the Senate’s amendments, the bill continues to improve the overall effectiveness of the Trade Practices Act in protecting the competitive processes in Australian markets. I commend the amendments to the House.

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