Australian Cartel Law: Biopsies

Abstract

The Competition Policy Review Final Report (31 March 2015) (Harper Report)1 made numerous recommendations for changes to the Australian Competition and Consumer Act 2010. Many of these recommendations were adopted in amendments that came into effect on 6 November 2017. Other recommendations may be adopted in future amendments. Australian cartel law remains problematic in various major respects. This paper considers the following:

(a) “contract, arrangement or understanding” – should the concepts of “arrangement” and “understanding” be modified to reflect a different underlying model of agreement (Part II);

(b) “cartel provision” – the concept of “purpose” in s 45AD raises basic unresolved issues of design and application (the status of the News Ltd v South Sydney “end in view” notion; the capricious including party rule to determine whose purpose is relevant; the uncertainty whether counterfactual analysis is relevant; and what purpose means in the context of algorithmic market coordination by autonomous agents) (Part III);

(c) exemptions from cartel prohibitions – the joint venture exemptions are ill-defined, there is no exemption for supply/acquisition agreements between competitors; and class exemptions remain unknown in quantity and quality (Part IV); and

(d) liability and sanctions – improving enforcement against offshore individuals and responding to the well-known limitations of monetary penalties against corporations (Part V).

Keywords: Algorithmic collusion, Cartel law, Cartel provision, Class exemption, Competition law, Corporate purpose, Counterfactual analysis, Deterrent impacts theory, Enforced self-regulation, Harper Review, Incentive theory of deterrence, Individual liability, Joint venture exemption, Punitive injunction

JEL Classification: K10, K12, K30