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Wednesday, 14 August 1974
Page: 940


Senator GREENWOOD (Victoria) - The Opposition has another amendment to clause 49. Sub-clause (2) states:

Sub-section ( 1 ) -

That is the general prohibition on price discrimination- does not apply in relation to a discrimination if-

(a)   the discrimination makes only reasonable allowance for differences in the cost or likely cost of manufacture, distribution, sale or delivery resulting from the differing places to which, methods by which or quantities in which the goods are supplied to the purchasers; or

(b)   the discrimination is constituted by the doing of an act in good faith to meet a price or benefit offered by a competitor.

On behalf of the Opposition, I move:

In sub-clause (2) (b), after'benefit', insert' reasonably believed to be'.

This will mean that the sub-clause will not apply if the discrimination alleged 'is constituted by the doing of an act in good faith to meet a price or benefit reasonably believed to be offered by a competitor of the supplier'.

I shall explain the way in which we see the need for this amendment. A supplier may be approached by a customer and asked whether he will reduce his price of $1 per product item. The customer might say: 'I am a good customer and I am entitled to some consideration from you.' The supplier might reasonably respond by saying: 'Yes, but I have this price discrimination provision and I cannot give you any discount or allowance'. The customer might then say: 'Yes, but I have been offered a price of 98c by your competitor X. Can you better that?' What does the supplier do? He may well say: 'All right, I will give you a price of 95c'. Is the supplier engaging in the offence of price discrimination under clause 49? Obviously he is offering a discrimination because everyone else is charged $ 1 for the product item but he is offering this customer a price of 95c.

This supplier is excused from any offence if he can fit himself within the provision to which I am referring; namely, sub-clause ( 1)- the offence of price discrimination- does not apply in relation to a discrimination if 'the discrimination is constituted by the doing of an act in good faith to meet a price or benefit offered by a competitor of the supplier'. Does the supplier about whom I am speaking have any knowledge of what his competitor offered the customer? The only knowledge he has is what he has been told.

It seems to me that the Government is placing an enormous burden and obligation upon the supplier to have to face the consequences of an offence against this clause if he believes in good faith- I know the words 'in good faith' appear in the clause- what he is told by his customer. Suppose that his customer is a liar. Suppose that his customer is out to get the very best deal he can and he has not been offered by somebody else a price of 98c, that he simply tells the person from whom he is seeking the best price he can get that he has been offered 98c by somebody else. Is the supplier excused? This is a legal question that I suppose a judge some day in some way will have to answer. I personally, when I look at this provision, believe that the supplier would not be protected by this exempting provision. I think in those circumstances he should be protected. That is why those words 'reasonably believed to be' have been moved as an amendment to be included in the provision. I would hope that the force of the situation I have advanced has an appeal or an understanding for the AttorneyGeneral and he might accept the amendment. In any event, I would be grateful for his response.







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