The Commerce (Cartels and Other Matters) Amendment Bill received its first reading in Parliament on 24 July 2012, and is now before the Commerce Select Committee. The bill proposes several amendments to the Commerce Act, including the introduction of criminal sanctions for cartel conduct. Written submissions to the Select Committee are now closed and a hearing is expected to be held shortly. The Committee is due to report back on the bill by 24 January 2013.
The Commission’s submission to the Commerce Select Committee expressed our support for much of the bill, but proposed amendments in four areas.
We think the collaborative activity exemption should expressly require the courts and the Commission to consider the pro-competitive purpose of the collaboration, and any efficiency likely to be produced as a result of the collaboration. This would give greater prominence and express recognition to what we understand to be the legislative purpose (encouraging pro-competitive conduct).
We also submitted that the proposed ‘honest belief’ defence is not necessary. Businesses who are unsure about the legality of their collaborations can apply for clearance. We also note that this proposal is out of step with international anti-trust law, and, as currently drafted, the defence applies to a mistake of law which is not usually a defence to a criminal charge
The Commission also suggested that the new jurisdiction section and new merger enforcement mechanisms need to be amended to ensure that they are effective.
The Commission intends to appear at the Select Committee hearing to speak to our submission and offer the Committee any assistance we can with the operational implications of the bill.
Our full submission to the Commerce Select Committee will be published on our website shortly.
