Monopolies necessary: Examiner

Press, 31 March 1981, Page 13

Monopolies necessary: Examiner

Wellington There is little evidence that New Zealand’s “manv” commercial monopolies act against the public interest according to the Examiner of Commercial Practices (Mr A. E. Monaghan). He had been asked for his reactions to an attack on the Commerce Act by the Leader of the Opposition (Mr Rowling). Mr Rowling said there had not been a monopoly inquiry in the five years since the new act was passed. He said the only merger the legislation really stymied in recent years was the FletcherCarter Holt proposal. "Fletcher - Challenge - Tasman, which was liable for examination under several clauses of the act, went through without the Examiner even visibly twitching,” Mr Rowling said. Mr Monaghan declined to comment on Mr Rowling’s remarks of his performance over the Fletcher-Challenge take-over. “I am quite happy about my own' actions on this,” was his only comment. He said many people were confused about the difference between a big company and a monopoly. "I think a lot of people do not understand a monopoly. It is not necessarily a big company. It occurs when a company can dominate the market completely.” he said. Mr Monaghan 'said there was a wide range of consumer and export monopolies in New Zealand ranging from television broadcasting, pulp and paper, hardboard, and apples and pears, through to such simple items as nuts and bolts. ’’There are lots of monopolies in New Zealand, and there must be, as we are only a small country. It would be uneconomic for

there to be more than -one manufacturer of some items. I have not had any serious suggestion that all these be investigated.” The Commerce Act allowed any person to file a complaint which he would investigate. If satisfied that a prima facie case existed, that a monopoly was acting against the public interest, he would refer it to the Commerce Commission, which would hold an inquiry. Mr Monaghan also has the power to initiate inquiries of his own and. in fact, did so last year when he referred the proposed take-over of the McKenzies chain by the L. D. Nathan Group. He recommended that the take-over be disallowed because it could produce a harmful monopoly in a section of the retail market. The Commerce Commission, however, allowed the take-over. Mr Monaghan said it was fair to suggest that the lack of inquiries meant a lack of any problem. “There is no evidence of a real problem.” he said. The Prime Minister (Mr Muldoon) said that Mr Rowling’s tactics in trying to conjure up a bogy of “big business” had no relevance in the modern world. It was a reversion to tactics of the 19305. “It is just another convulsion of the Labour Party, which week by week is being deserted by more of its moderates, both in and out of Parliament,” Mr Muldoon said. He said that Mr Rowling had said the Commerce Act passed by a Labour government .was not worth the paper it was written on. “There was a great deal o: Labour legislation that feL into that category,” Mr Muldoon said.