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Thursday, 9 December 1976

Mr Hodges asked the Minister for Business and Consumer Affairs, upon notice:

(   1 ) Has his attention been drawn to overcharging for car parts as reported by the Royal Auto Club of Victoria Insurance Pty Ltd in the Brisbane Courier Mail on 21 October 1976.

(2)   Has he been officially notified by the RACV insurance Pty Ltd.

(   3 ) What action does he propose to take on this matter.

Mr Howard -The answer to the honourable member's question is as follows:

(1)   Yes.

(2)   Yes.

(3)   I have noted claims that prices being charged for motor vehicle spare parts by some resellers appear to be unduly high and I have requested the Chairman of the Prices Justification Tribunal to advise me what action might be taken.

In this regard, the function of the Prices Justification Tribunal is to determine whether prices charged or proposed to be charged by companies are justified and, if not, what lower prices would be justified.

Apart from the Tribunal's power to examine prices proposed to be charged by those companies which are required under the legislation to notify their prices, the Tribunal also has a general power to inquire into prices charged by any company irrespective of its size.

Prices charged by non-incorporated enterprises such as partnerships or sole proprietorships are outside the jurisdiction of the Tribunal. Thus, prices charged for motor vehicle spare parts by such resellers would not be subject to surveillance by the Tribunal.

From a trade practices viewpoint it is relevant to this matter that although the practice of fixing minimum resale priceis unlawful, the fixing of maximum resale prices is not Accordingly, it is open to manufacturers and importers of motor vehicle spare parts to establish maximum prices for the resale of their products. It is also open to individual insurance companies to unilaterally refuse to deal with those suppliers of motor vehicle spare parts whom they consider to be charging excessive prices.

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