Louise Pratt (WA, Australian Labor Party) Share this | Hansard source

I welcome the Trade Practices Legislation Amendment Bill 2008 as it is in the interests of competition, consumers and business. It is a key part of the government’s economic reform agenda, giving the Australian Competition and Consumer Commission the tools it needs to promote competition and fair trading and to protect consumers. It is indeed the most significant reform of the Trade Practices Act in some 22 years. And I am pleased to say that enhancing competition policy is at the core of the Rudd government’s economic agenda, as is highlighted by other policy measures such as ‘grocery watch’ and Fuelwatch, which we will continue to pursue.

These reforms will make it easier to prosecute businesses engaging in anticompetitive behaviour, give small businesses permanent representation on the ACCC and allow small businesses to access a cheaper and more efficient judicial process. So I believe these reforms are good news for small businesses like independent petrol retailers and small grocers who are competing against more powerful, larger businesses.

These reforms have been welcomed by consumer and small business advocates. In particular, I would like to highlight the views of the Fair Trading Coalition, which is an informal coalition of small business working towards reform of the Trade Practices Act. I note that the Senate inquiry into the effectiveness of the Trade Practices Act in protecting small business some time ago called for the reform of the concept of ‘take advantage’ in section 46. The present meaning of the term has prevented section 46 from properly capturing anticompetitive behaviour, so the amendment to clarify the phrase ‘take advantage’ has been welcomed. The government’s amendments will ensure that victims of predatory pricing will not need to prove that the predator has the ability to recoup losses after participating in an anticompetitive, below-cost pricing strategy. I think this is significant because the bill removes the unnecessary uncertainty that has arisen following the two-track process for predatory pricing that developed under the previous government.

It is also time—and we have heard many speakers say this this evening—for the Birdsville amendment to go, in favour of a stronger and more workable predatory pricing provision. The initial introduction of the Birdsville amendment was welcomed as the first explicit recognition of predatory pricing within the act. However, as Mallesons Stephen Jaques partner Dave Poddar said to the Australian Financial Review:

The Birdsville Amendment, apparently derived at the pub by Senator Joyce, was one of the more unusual policy initiatives of the last government—

having been created in a pub, I am sure it is—

and is a law which is out of step with competition policy in this area.

He went on to say that it is flawed because it focused on market share alone in deciding whether a company had market power. He said that it was an overly simplistic approach and that the government’s proposed changes are sensible. Likewise, Stephen Corones from the School of Law at QUT has highlighted—