Swanson Report 1976
Trade Practices Act Review Committee (August 1976)
Reporting body: Trade Practices Act Review Committee (Independent)
Length: 101 pages
Government in power: Coalition (Fraser)
In brief
This review took place two years after the Trade Practices Act 1974 was enacted (now the Competition and Consumer Act 2020)
It reviewed the operation and effect of the Act, including 'whether the Act is achieving its intended purpose of the development and maintenance of a free and fair market, and whether Australian consumers are benefiting from the Act’
Competition conduct / prohibitions considered
Key recommendations included (not limited to):
Section 45 Anticompetitive agreements and price fixing
Recommended replacing ‘restraint of trade’ with test of ‘a substantial adverse effect on competition’.
Recommended per se prohibition of price fixing
Market definition
Recommended ‘that the Act should require that, in the determination of a 'market' for particular purposes, regard shall be had to substitute products, being products which have a reasonable interchangeability of use and which have high cross-elasticity of demand, i.e. where a small decrease in the price of a particular product would cause a significant quantum of demand for a similar product to switch to the product in question.’ (para 4.22)
Misuse of market power
Recommended against requiring that the purpose intended by conduct need to be proven to have taken place
Price discrimination
Noted this prohibition drew more criticism than any other
Recommended section 49 be repealed
Mergers
Recommended threshold test be written into section 50 so that it did not apply to mergers involving at least one relatively small company
Recommended removing the power for ministers to intervene in merger authorisation matters.
Clearance and authorisation
Recommended clearance provisions be repealed except in relation to mergers
Recommended change to authorisation test in relation to price based conduct (that power to authorise be removed in those cases)
Recommended time limit for Commission decision on authorisation.
For a full list see the ‘finding guide to recommendations’ at the end of the report.