Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard   

Previous Fragment    Next Fragment
Tuesday, 28 February 1984
Page: 58


Senator HAINES(9.12) —The Australian Financial Review reported on 15 September 1978 the comments of Mr A. H. Page, then, I understand, a senior officer with the Department of National Resources. Amongst the comments he made was this sentence:

The philosophy underlying US anti-trust law is not necessarily in Australia's national interest in regard to export of our natural resources.

Nor apparently was it considered to be in the interests of certain other countries, as the Australian Trade Practices Reporter mentioned several years later in an article under the heading 'Enforcement Jurisdiction', which made the following comment:

. . . the encroachment of foreign anti-trust investigation and litigation abroad has recently led to positive action by way of blocking legislation enacted, inter alia, by Australia, the United Kingdom, the Federal Republic of Germany, Canada and The Netherlands . . . Governments have felt it necessary to secure their own sovereignty by legislating to protect their own citizens against investigations and orders sought to be enforced domestically by the US authorities where doubt exists as to the likelihood that the courts will prevent such investigations on the ground of their repugnancy to international law.

The blocking legislation enacted in Australia relates both to the investigatory stage and the enforcement of orders in foreign proceedings. Although it is not strictly relevant to the extra territorial operation of the Australian Act, it is convenient that it be dealt with here-

that is, in this article-

and maybe instructive from the point of view of comparison.

The two pieces of legislation were a direct result of proceedings seeking treble damages commenced by Westinghouse Electric Corporation against 29 United States and foreign uranium producers.

The Westinghouse case in 1977-79, if it served to do nothing else, served to highlight the fact that as yet Australia and other trading nations do not live in a world economic community. Certainly no one would argue that the removal of artificial trade barriers within a nation state such as Australia is essential if we are to achieve the benefits flowing from competition, such benefits including lower cost to the consumer and the efficient allocation of resources within the economy. Notwithstanding that fact, even in that context we in this country justify a degree of intervention to protect the weak. It is interesting to note though that as yet we in Australia have no legislation akin to the anti- trust laws in the United States which are designed to ensure that the strong do not misuse their position to force up market prices. That may at the moment be no real problem in Australia and indeed there may be no internal need for such legislation. However, it is quite another matter if such internal provisions are to be used to disadvantage individual companies trading in the world economy. In that context it is essentially the individual nation states rather than the individual companies which are trading partners, with varying degrees of strength. Individual companies are part of their respective economic fabrics and I believe nations have the right and the duty to protect those companies against attacks on their economic viability which in turn could well affect the national economy.

In 1977-78 Australia's export income from minerals was $4.7 billion, which represented something like 39 per cent of the total national export income that financial year. This was of no small value to Australia and the Australian Government encouraged it, as indeed it should. In the context of what, in view of recent developments, we laughingly call resource diplomacy, Australian companies sued by the Westinghouse Corporation did what Australian Government officials had been recommending that they do to avoid being played off against each other by international buyers; that is, they made price agreements in a market which had been severely destabilised by the release of in the vicinity of 50,000 tonnes of U308 from the United States uranium stockpile.

At this point, in view of the resource which was involved, I ought to make the point that the Australian Democrats view that the Australian companies were entitled to government intervention to protect them and to protect Australia's economic interests is not to be taken as any sort of approval of or support for the products they were trading in.


Senator Peter Rae —Look, I am shattered!


Senator HAINES —I thought that the honourable senator would be absolutely destroyed by that! I am totally and utterly surprised! However, I am sure the honourable senator will agree that we all share a belief in the principle of the matter; that is, that it was something of vital concern to Australia, the effect of which on the companies concerned and on the Australian economy could have been quite devastating. In the event, the punitive treble damages available under United States anti-trust legislation which I have already mentioned in the article from which I quoted at the beginning-I understand they were something like $7 billion-and which may well have been justified and justifiable in that context and in that country were sought against 29 uranium producers, including Conzinc Rio Tinto of Australia Ltd, Mary Kathleen Uranium Ltd, Pancontinental Mining Ltd and Queensland Mines Ltd. Ultimately, as I understand it, the judgment was entered after, and indeed despite, Australia's attempt to raise jurisdictional objections; and those objections, I also have been given to understand, were somewhat contemptuously dismissed.

As a consequence, in March 1979 the Australian Parliament enacted the Foreign Anti-Trust Judgments (Restriction of Enforcement) Act enabling enforcement of the judgment in proceedings in Australia to be prohibited by order of the Attorney-General. Orders were in fact made by the Attorney-General prohibiting the enforcement or recognition in whole or in part in Australia of the judgment entered in these proceedings. However, that 1979 Bill was limited in its application merely to anti-trust judgments. The 1981 'recovery back' Bill introduced by the previous government was not passed, as I understand from some comments made by Senator Durack earlier this evening, apparently in an effort to avoid straining the somewhat fragile agreement on anti-trust co-operation concluded with the United States in 1982. I am somewhat at a loss to understand why it is always Australia that has to tread fairly warily whenever these sorts of agreements look like being broken or strained to the limit. Certainly the United States of America did not worry too much about what damage it was likely to have on its relations with Australia when the United States undertook the proceedings which produced this brouhaha.

As Senator Durack also pointed out, that agreement provides avenues for consultation and negotiation but acknowledges that ultimately 'both countries can protect their national interests as they see fit'. Indeed, I believe that the 1979 decision by the Australian Attorney-General was made for the purpose of protecting our national interest in relation to the trading operations of trading or financial corporations formed within the limits of the Commonwealth. The present Bill seeks to further this aim by extending protection against enforcement to other than anti-trust actions and to protect Australian citizens and companies from the extraterritorial enforcement of foreign laws.

I am not a lawyer. I cannot judge or enter into the fascinating arguments that have been thrown around the chamber tonight by the legal experts in this place. I can simply say that if in effect this Bill does do just that-as I have indicated it does, that is, if it offers protection to Australian citizens and companies from the extraterritorial enforcement of foreign laws, laws which may be well suited to the country in which they were formed but of no particular relevance to Australia, whose laws are established under totally different criteria-it will be supported by the Australian Democrats.