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Wednesday, 24 August 1994
Page: 278

(Question No. 1414)


Senator Woods asked the Minister representing the Treasurer, upon notice, on 31 May 1994:

  (1) Has the Trade Practices Commission issued an authorisation under section 88 of the Trade Practices Act to Medibank Private in relation to a Medibank Private pamphlet which specifies that John Flynn Hospital and Highland Park Surgi Centre are preferred providers for Medibank Private contributors on the Gold Coast.

  (2) Can the Trade Practices Commission instigate action in a situation where a section 88 authorisation has not been issued and where some action results in a substantial lessening of competition and where there is no public benefit to be gained from the action, for example, in the form of reduced costs.

  (3) Is this a breach of section 50 of the Trade Practices Act.

  (4) Has the Trade Practices Commission issued an authorisation under section 88 of the Trade Practices Act to Medibank Private to allow them to issue a pamphlet which details preferred providers and does this constitute a restrictive trade practice.


Senator Cook —The Treasurer has provided the following answer to the honourable senator's question:

  (1) No.

  (2) The Trade Practices Act 1974 permits the Trade Practices Commission to instigate proceedings for a contravention of a provision of Part IV of the Act. While public benefit is relevant when the Commission is determining whether it should grant an authorisation, it is not an element in any offence created under Part IV of the Act.

  (3) No. An acquisition of shares or an asset must occur for section 50 of the Trade Practices Act to apply.

  (4) The Trade Practices Commission has not issued an authorisation under section 88 of the Trade Practices Act to Medibank Private for the conduct described. Whether conduct is in contravention of Part IV of the Trade Practices Act would depend on whether that conduct substantially lessens competition and determination of that question ultimately is a matter for the courts. The matter raised by your question has been referred to the Trade Practices Commission for investigation.