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Thursday, 14 November 1985
Page: 2163

Senator CHILDS —I direct my question to the Minister representing the Attorney-General. Why has the Trade Practices Commission not taken action against the proposed Coles-Myer merger?

Senator GARETH EVANS —I am advised by the Attorney-General that section 50 of the Trade Practices Act prohibits only mergers that result in dominance or strengthen existing dominance of a substantial market. The Trade Practices Commission, which is an independent statutory authority, indicated on 8 August this year that it would not intervene, as Senator Childs's question implies. The Trade Practices Commission expressed concern at the degree of market power likely to result, but concluded that it would be unlikely to be such as to enable the mergered entity to behave in a manner exhibiting the hallmarks of dominance; that is to say, the statutory requirement. Significant competitors remain, such as David Jones, at department store level, and Woolworths and Venture at discount store level. The Government will ensure that section 46 of the Trade Practices Act can effectively control abuses of market power, particularly when firms like this have enormous buying power over suppliers. There are other ways of achieving some of the constraints and limitations that might be thought to be necessary in the consumer and public interest other than applying the merger provisions of section 50.