Competition law debated

Press, 8 March 1988, Page 23

Competition law debated

By

MARTIN FREETH

PA Auckland

Monopoly laws are not the bogies restricting progress under Closer Economic Relations (CER)! between New Zealand ( arid Australia that they ! are sometimes made out to be.

That was the view among speakers at a forum yesterday on competition law. They pointed instead to anti-dumping provisions as an obstacle to CER. The chairman of the Commerce Commission, Mr John Collinge, argued that merger and takeover laws on both sides of the Tasman were much the same, leaving no need for, harmonisation.

In addition, Mr Collinge said , the impact of those laws on trans-Tasman (industry rationalisation

compatible with CER “is likely to have been slight.” ! Decisions on mergers had been adverse only( in one instance in each country: Amcor-NZ Forest Products, in New Zealand, and Equiticorp HoldingsEmail, in Australia. It was hard to say whether those blocked mergers restricted trade between the countries, Mr Collinge said (in a paper to a “Regulating for Competition” | conference organised by the Centre for Independent Studies. In spite of the criticisms of some, the principles and practise of the Commerce Act remained consistent with CER, 1 he said.

The act meant mergers and takeovers were j first assessed for! their impact on New Zealand markets

and consumers, but the commission could still sanction a monopoly if wider public interests were served, such as CER.

Mr Collinge said the commission had accepted all specific CER arguments put to it, but for a claim by Goodman Fielder Wattie that having its head office'in Sydney benefited this country.

But, when companies claimed a merger would enhance their international competitiveness or boost exports from both countries, the commission required details of just how the public would benefit. Professor Thomas Parry, a University! of New South Wales economist, said. New Zealand and Australian laws on

competition differed, only on the procedure: for handling mergers j and takeovers.

Both academics felt reform of anti-dumping provisions was the j step needed to harmonise competition laws, jyith reliance more on “price discrimination” legislation. I

Professor Parry argued anti-dumping laws (could be frivolous, used rriainly to disrupt imports! from particular sources. ; They were a means of promoting fair trade, Mr Collinge said. He favoured a ■ price discrimination law, aimed at specific suppliers who conferred a competitive edge through! their prices to a favoured participant in a particular riiarket.