Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

The government will not be supporting this amendment. The Harper review, like the Dawson and Harmer reviews before it, considered and recommended against establishing divestiture as a remedy to address misuse of market power concerns. At these reviews, each concluded that the existing range of available remedies is sufficient to deter misusers of market power and to compensate parties harmed by such conduct. Divestiture is not appropriate for breaches or misuse of market power as it would not target the conduct of concern.

But divestiture is currently available as a remedy for mergers and acquisitions which breach the Competition and Consumer Act. This is appropriate because the remedy directly targets and unwinds the transaction which breached the act. This would not be the case for section 46, where divestiture would at best be a blunt weapon which would not directly address the conduct of concern. The courts would then need to engage in the difficult task of restructuring what may be a highly-integrated firm to achieve this reduction in size. Moreover, there would be a high risk of unintended consequences—for example, a business or parts of it becoming uncompetitive or even unviable, which would be detrimental to consumer welfare.

As I've indicated in various reviews in this space—most recently the Harper Review but before it the Dawson and Harmer reviews—all looked at this and all recommended against it.