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Wednesday, 14 August 1974
Page: 926

Senator GREENWOOD (Victoria) - Senator Everettdid not speak for long. I wonder whether the reason for his brevity was that he recognised that in the elaboration of the clause in which he engaged he almost gave the case which the Opposition is putting forward, because he construed the clause which we are looking at in terms of 2 requirements. Firstly, he said that the company which is in the substantial position must take advantage of the power which it has in relation to that market; secondly, he used the words ' for the purpose of eliminating or substantially damaging a competitor'. I challenged him because the words 'for the purpose of are not in the clause. The one word which is there is the short word 'to'. Senator Everett said he would construe that as 'for the purpose of, but once you get into this area of purpose I think you have to display something in the nature of intent or wilfulness. An individual or a company is doing something for the purpose. It seems to me that what you have to be able to show, on Senator Everett's interpretation, is this wilfulness, and that is why we are seeking to make it part of the offence.

Senator Everett - How would you construe the word 'to"?

Senator GREENWOOD - I would construe the word 'to' in the sense it has in the Bill as 'if it has that effect'. Suppose, for example, a companyI think Senator Wright used this general example- acquires additional machinery because it has a certain power or rights. It may have patent rights or it may have purchased the machinery to take advantage of its size in a way which was not readily available to other companies. Suppose that in doing that, irrespective of what intent it had, it so happened that it was able to secure a further advantage which had the consequent effect of damaging and maybe eliminating competitors which could not sell as cheaply as that company was thereafter able to sell. It seems that if a company does that it ought not be regarded as engaging in monopolisation with all the penalties that this legislation seeks to impose upon it.

I suggest to Senator Everett that this is not a matter of endeavouring to emasculate the legislation. I think it is a problem which is inherent in this type of approach. It is a question of what is fair. Is it fair to penalise a company which undertakes activities which lead to increased efficiencies, reduced costs and reduced prices if as a result of doing that, without any intention of getting that result, a competitor goes to the wall? I think that the strength of our type of society has been built up because in the competitive environment the efficient have survived and the inefficient have not survived. That type of enterprise system builds up an economy and builds up a nation. We on this side of the Senate want to preserve it. I would think that conduct of the type which is proscribed by this legislation is more than likely to cause the destruction of innovation and initiative and all the benefits which competition can produce, rather than to promote those benefits of competition. We in the Opposition, of course, believe that size in itself is not wrong but that size which is improperly used is wrong. We believe that there ought to be a system under which misuse of power, misuse of dominant position and misuse of that control of a market which size produces is able to be controlled.

This is why we proposed the establishment of a monopolies commission. We regret that the Government does not see any merit in that type of commission, although it sees a lot of merit in all sorts of other commissions. We believe that that sort of investigatory approach would have examined all the allegations that are made against monopolies. It would have prevented those practices which were bad and it would have permitted those ones which were in the public interest. It would have been a system under which a distinction could have been made between anti-social practices and practices which were in the public interest. What this provision does is to create enormous uncertainty and raise doubt as to whether people who are genuinely promoting and developing their business activities are not going to find themselves proscribed and prejudiced simply because one of the ordinary consequences, unintended by them, is that a competitor is damaged or eliminated or that someone else who thought that he may have been able to enter a market finds that he is not able to do so. What ought to be looked at is the dominance which a company has in a particular area and whether that dominance is used improperly and in a way that may not be the best way. Apparently, the Attorney-General is not interested in trying to find a different approach to the problem.

We have suggested that the position can be helped by the addition of one word, 'wilfully', in the clause, so that where the action is taken with the intent of achieving one of these undesirable effects which are set out in the clause, that is what will be proscribed. If something happens simply as an unintended consequence or as a consequence which was not the purpose of the action, under those conditions there is no proscription intended. We believe that this is an amendment which ought to commend itself to the Senate.

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