French, Justice Robert --- "Horizontal arrangements - competition law and cooperative federalism" (FCA) [2007] FedJSchol 6

1 Federation denotes a class of solutions to the problem of uniting people from different political communities into a viable national polity. Professor Geoffrey Sawer, in 1976, spoke of a “spectrum of federalism” as the range of reactions to the situation in which:

2 The distribution of power between the components of a Federation sets boundaries upon their legislative competencies. When, in a Federation such as Australia, a national policy is necessary to meet national challenges the powers necessary to implement such a policy may cross those boundaries. One way of meeting the problem is to amend the Constitution. In Australia that has proven to be a singularly unrewarding process. A second way is the coordinated exercise of relevant legislative powers by all components of the Federation – a horizontal arrangement. This is presently the dominant model in the implementation of national competition policy. A third way is the cession of necessary power to the centre – a species of vertical integration.

3 The Commonwealth of Australia Constitution Act 1900 established the Australian Federation and conferred on the Commonwealth Parliament law-making powers with respect to specific topics. The Constitutions of the States were continued in force subject to the Commonwealth Constitution as were their law-making powers save for those vested exclusively in the Commonwealth Parliament or withdrawn from the parliaments of the States.[2] The legislative powers of the Commonwealth are, for the most part, concurrent with those of the States. However where a law of a State is inconsistent with a law of the Commonwealth, the Commonwealth law shall prevail and the State law shall, to the extent of the inconsistency, be invalid.[3]

4 The existence of Federal and State polities, the division of legislative powers between them and the scope for concurrent laws dealing with the same subject matter must be considered in devising any national regulatory policy requiring legislative implementation. And in today’s world, implementation may be affected by international obligations. The response best fitted to meet such obligations is likely to be single, coherent and national, rather than plural and sub-national.

5 The above considerations are relevant to competition policy and, generally speaking, are reflected in its implementation in Australia. Unhappily, some Commonwealth and State arrangements, involving interlocking or adopted statutes, while designed to achieve a coherent national approach, have introduced a level of legal complexity, jurisdictional uncertainty and associated transaction costs which may be unnecessarily high. Some would say such costs are an unavoidable incident of federation. But where the complexity pays little more than cosmetic homage to State sovereignty, the simpler constitutional solution of referral of powers, underpinned by inter-governmental agreements with appropriate safeguards, may be preferable.

6 This paper considers the constitutional distribution of powers which requires cooperative approaches to achieving a comprehensive competition law in Australia. It does not pretend to offer a comparative cost benefit analysis of the alternative solutions. Some of the factors to be weighed in the balance, such as the benefits of multiple centres of legislative and executive power, are difficult if not impossible to quantify. The existence of effective State legislatures is seen by some as a guarantee of localism, productive pluralism and countervailing powers bringing benefits outweighing the costs and inconveniences of a multiplicity of governments. Others see the continued existence of such costly constitutional arrangements for such a small population as a luxury and an impediment to effective participation in an international community which requires rapid and coherent responses to changing circumstances. Between these poles there are other views which would accept the cession to the national government of limited State law-making powers in order to facilitate national responses.

7 The problem of implementing competition law in a federal system is not unique to Australia. There has been debate and discussion on the question in the United States in the context of concurrent and sometimes conflicting antitrust laws and enforcement action by federal and state authorities. However, in that country, unlike Australia, the position of the States as concurrent regulators of their own antitrust laws as well as plaintiff parties in federal anti-trust litigation seems well entrenched.[4]

8 On the other side of the coin the European Union in 2004 devolved to member States concurrent responsibility for the administration of community competition law reflected in Articles 81 and 82 of the Treaty of Rome. The European devolution was made pursuant to Council Regulation (EC) No 1/2003. Article 5 of that Regulation provides that the Competition Authorities of the Member States have power to apply Articles 81 and 82 of the Treaty in individual cases. By Article 6 of the Regulation, national courts are given the power to apply Articles 81 and 82. The European Council, in an Explanatory Preamble to the Regulation, referred to the importance of effective and uniform application of Articles 81 and 82 on the one hand, and on the other hand the need for effective supervision and simplified administration. The Explanatory Preamble continued:

Given the population of the expanded European Community and the immense burden of administering a community-wide competition law from a central authority, it is not surprising that such a step was taken. The position in Australia, however, generates quite different imperatives.

9 Competition policy is concerned with a variety of activities and a variety of actors. Competition in Australia may be affected by conduct:

10 The range of activities and entities relevant to competition law extends beyond the subjects with respect to which the Commonwealth Parliament has legislative competence. Relevantly the Commonwealth Parliament may make laws with respect to:

11 Importantly the Commonwealth Parliament is also entitled to make laws with respect to:

12 In addition to the powers it has under s 51, the Commonwealth Parliament may make laws for the government of any Territory by virtue of s 122.

13 The legislative powers set out in s 51 are, for the most part, concurrent with those of the States. Even after the enactment of the first Commonwealth competition law, The Australian Industries Preservation Act 1906, there were State laws on competition related matters.[15] The case law on the State statutes is sparse.[16] As Professor Walker said in 1967:

14 The history of Commonwealth legislation is well known and it is not necessary to repeat it in detail. The 1906 Act showed little sign of life for most of its existence. Its successor, the Trade Practices Act 1965 (Cth), provided for a Register of Examinable Agreements. It became the Restrictive Trade Practices Act 1971 but, in the Concrete Pipes’ case was found to exceed limits on Commonwealth legislative power[18].

15 The Trade Practices Act 1974 (TPA), when enacted, invoked every available head of constitutional power to maximise the range of entities and conduct within its purview. It relied principally on the corporations and incidental powers. However, s 6(2) established, for some parts of the Act, an application limited by the assumption that references in them to trade and commerce were confined to trade and commerce:

For the specified classes of trade or commerce the TPA did not need to rely upon the corporations power but relied upon s 51(i), s 51(xxxix), presumably read with s 61 of the Constitution, and s 122. Section 6(3) applied the TPA to individuals where their conduct involved the use of postal, telegraphic or telephonic services or takes place in a radio or television broadcast. Certain parts of the TPA were extended by s 6(4) to conduct done in the course of the promotional activities of a professional person, where the relevant conduct was in a Territory.

16 Section 55 of the TPA, which prohibits misleading conduct as to the nature, the manufacturing process, the characteristics, the suitability for their purpose or the quantity of any goods, applied beyond corporations to “persons” and relied upon the external affairs power and Australia’s notification of the Paris Convention for the Protection of Industrial Property.[19]

17 These applications of the Act, outside the large and increasing scope of the corporations, and trade and commerce powers, left gaps in its coverage and thus something of a Swiss cheese statute. Commonwealth legislative power alone could not deliver a comprehensive and coherent national competition law. An answer to the problem was found in the field of cooperative federalism. That term was once described by McHugh J as a political slogan.[20] No doubt it has been used as a political slogan but it is also descriptive of a range of legal mechanisms either permitted or expressly contemplated by the Constitution. Indeed it would not be going too far to say that the Constitution, while marking out the boundaries of legislative power between the components of the Federation, rests upon an assumption of cooperation between them.

18 Before considering the way in which cooperative federalism has been used to advance national competition policy, it is useful to review the cooperative mechanisms which are available and have been used in other contexts.

19 Where the legislative powers of the Commonwealth are to be deployed in an area requiring comprehensive national coverage, there are mechanisms of cooperative federalism under which such coverage can be achieved. These include:

The history of corporations regulation in Australia shows a succession of cooperative and not so cooperative arrangements at work.

20 In 1961, under a Uniform Companies Act Scheme agreed between them, each State parliament passed its own Companies Act which mirrored the terms of the Companies Act of every other State. The law in each State had application only within the territorial limits of the jurisdiction of that State. Jurisdiction was exercised by the Courts of the States. There was thus a mosaic of similar laws throughout the country rather than one law covering the whole country. The scheme, although simple in concept, was susceptible to the development of differences over time because of pressures brought to bear upon particular State legislatures.

21 In 1981 the Uniform Companies Scheme was replaced by another cooperative scheme based upon the Companies Act 1981 (ACT) enacted by the Commonwealth Parliament for the Australian Capital Territory in reliance upon s 122 of the Constitution. Each of the States passed a Companies Code which reflected the provisions of the Commonwealth Act. The Scheme was overseen by a Ministerial Council for Companies and Securities and a national regulator, called “The National Companies and Securities Commission” (NCSC), which worked in conjunction with State regulatory authorities.

22 In 1989 the Commonwealth, acting unilaterally in reliance upon the corporations power, passed the Corporations Act 1989 imposing a national scheme of corporate regulation. It established the Australian Securities Commission (ASC) under that Act. In 1990 the High Court held elements of the Act invalid because the Commonwealth did not have power to make laws about the incorporation of companies.[22] Under a new cooperative arrangement the Commonwealth then enacted the Corporations Act 1989 (ACT) and the Australian Securities Commission Act 1989 (ACT), each being a law for the Australian Capital Territory. The States each passed their own statutes which applied the provisions of the Territory Acts designated as the Corporations Law and the ASIC Law respectively as laws of the respective States. The States also purported to confer jurisdiction on the Federal Court and the State Supreme Courts with respect to civil matters arising under their Corporations and ASC laws. In 1999 the High Court struck down so much of the legislation as purported to confer jurisdiction on the Federal Court with respect to matters arising under the State laws.[23] The difficulties caused by this invalidation of the cross vesting of State jurisdiction to the Federal Court were compounded by the High Court’s approach to the construction of laws made under the scheme in so far as they conferred functions under State law upon Federal authorities such as the Commonwealth Director of Public Prosecutions and the Australian Securities and Investments Commission.[24]

23 The striking down of the cross vesting arrangements under the cooperative corporations scheme led, after some political contention, to another cooperative solution whereby the States referred to the Commonwealth the power to make laws in terms of the texts of a proposed Corporations Act 2001 and an Australian Securities and Investments Commission Act 2001. These Bills largely reflected the terms of the former Corporations Law and ASIC Law. Each State also referred to the Commonwealth:

The latter reference had effect only to the extent that the matter was not already a subject of Commonwealth power. There was a five year sunset clause for each reference.

24 Following the references by the States the Commonwealth Parliament, relying upon s 51(xxxvii), passed the Corporations Act 2001 (Cth) and the Australian Securities and Investment Commission Act 2001(Cth). The Commonwealth and the States made an agreement which included undertakings about the use of the referred powers and procedures for the alteration of the statutes and for termination of the references. The agreement required that the operation of the scheme be reviewed every three years. The scheme was powerfully supported by referral agreements made by Victoria and New South Wales directly with the Commonwealth. Other States were then left with little option but to fall into line. Queensland did so. Western Australia did so following a change of government in that State. South Australia and Tasmania also joined after the Commonwealth agreed to consider an amendment limiting the degree to which the power could be used to require persons to incorporate.

25 The development of the comprehensive regulation of corporations in Australia showcases cooperative arrangements which are possible under the Constitution. The most drastic of them from the States’ point of view is referral because that does involve an expansion, be it permanent or temporary, of Commonwealth legislative power on the subject matter referred. It is no doubt for this reason that the referral in relation to corporations was limited to the text of a particular Bill and subject to a sunset clause.

26 There have been a number of references of power pursuant to s 51(xxxvii) since Federation although the use of that provision become more prominent because of its recent applications to corporations and anti-terrorism laws. Referrals have covered, inter alia, meat inspection, State banking, poultry processing and air navigation. All States except Western Australia have referred powers in relation to child custody, guardianship access and maintenance to the Commonwealth to avoid the artificiality of constitutionally derived distinctions. One important application of the referral power is the mutual recognition scheme. It applies to occupational qualifications and product standards. It has implications for competition policy in facilitating the movement of goods and services between the States. The scheme emerged from a Premiers’ Conference in 1990 which established a Commonwealth/State Committee on Regulatory Reform in 1991. That Committee prepared a discussion paper called “The Mutual Recognition of Standards and Regulations in Australia”. The paper pointed to the possibility that Australia might have more barriers to trade in goods and services between States and Territories than existed between the member nations of the European Community. Seminars were held in each capital city. In November 1991 Premiers and Chief Ministers met and a formal agreement was signed between the Commonwealth, the States and the Territories on 11 May 1992. The Mutual Recognition Act 1992 (Cth) was passed as a law of the Commonwealth following the referrals of power by the Parliaments of New South Wales and Queensland. Each of the referrals was for a fixed period. The matters referred were defined in the Referring Acts in terms of the “enactment of an Act in the terms or substantially the terms set out in the schedule”. In each case the proposed Mutual Recognition Bill 1992 (Cth) was scheduled to the State Referring Act. The law passed by the Parliament of the Commonwealth under that referral was then adopted by the other States and Territories, last with historical consistency, by Western Australia.

27 More recently the States referred power to the Commonwealth to make laws with respect to terrorism. The references were, in substance, text references. In Western Australia the referring statute was the Terrorism (Commonwealth Powers) Act 2002 (WA). The text of the referred provisions was set out in Schedule 1 to that Act and comprised a new Pt 5.3 of the Commonwealth Criminal Code. The operative provision of the referring Act was s 4 which referred:

(a) the matters to which the referred provisions relate, but only to the extent of the making of laws with respect to those matters by including the referred provisions in the Commonwealth Criminal Code in the terms, or substantially in the terms, of the text set out in Schedule 1; and

(b) the matter of terrorist acts, and actions relating to terrorist acts, but only to the extent of the making of laws with respect to that matter by making express amendments of the terrorism legislation or the criminal responsibility legislation.

28 The referral provision, s 51(xxxvii) confers upon the Parliament of the Commonwealth the power to make laws with respect to matters referred. The laws so made are federal laws. The power to make such laws is subject to the Constitution, a condition set out in the opening words of s 51. This means that constitutional prohibitions will operate with respect to them. As federal laws, laws made pursuant to s 51(xxxvii) will attract the operation of s 109 and will override inconsistent State laws. The Corporations Act 2001 endeavoured to avoid the risks of inadvertent inconsistency by expressly denying any intention “to exclude or limit the concurrent operation of any law of a State”. Indeed under s 5F of that Act the States may exclude the operation of the Corporations Law in relation to a matter in whole or in part. The Commonwealth by regulation can counter such an exclusion. There are also rollback provisions in ss 5G and 5I.

29 The language of s 51(xxxvii) raises constructional questions. The “matters” which can be referred under s 51(xxxvii) cover not only subject matter references but also text references of the kind that have been applied in the mutual recognition scheme and the Corporations Act scheme.[25] There is a question as to whether a reference unlimited in time is irrevocable.[26] However there appears to be little controversy that a referral may validly be made for a fixed period.[27] The availability of specific text references limited in time is of importance in securing the agreement of States to use the procedure at all. The question remains - what happens to a Commonwealth law passed under the referral power if a referring State terminates its referral whether according to a self-executing sunset clause or by revocation. It might be expected that such a law would continue in force in the State for there is nothing in the grant of the power which makes the law under it self-terminating upon revocation of the referral. The position of referring States and adopting States may be different. That is because the reference in s 51(xxxvii) to States whose parliaments “afterwards adopt the law” arguably provides for the extension of the law to those States only during the currency of their adoption of it. The possibility of laws made under a referral outliving the referral itself may not be a practical problem if, on a text referral, the proposed law contains a self-executing terminating provision operative upon revocation of the referral by a referring State. Such a termination provision could be framed to apply only to the revoking State leaving the law in force in other referring or adopting States.

30 A related question arises about the basis upon which a law made under a referral may be amended. Where it is a subject matter that is referred then so long as the referral subsists the Commonwealth should be able to amend laws made pursuant to it provided the amendment does not take the laws outside the scope of the subject matter referred. The effect of amendment upon the application of the law to States which have adopted the original law rather than refer the law-making power is questionable. Amendment of a referred law would seem to require adoption by non-referring States either of the amendment or of the law as amended if it is to continue to have effect in those States.

31 The States can adopt protective mechanisms to deter the Commonwealth from non-consensual amendment if the text of the law referred is subject to a condition that it would cease to operate if amended otherwise than in accordance with some agreed mechanism for obtaining consensus.

32 The unanswered questions of construction make one thing clear. Any use of the referral power must be underpinned by clear agreement between States and Commonwealth as to the mechanisms for termination and amendment of laws made pursuant to the referral. Moreover when referral is called in aid of the implementation of national policy such as the National Competition Policy it would ordinarily be essential that all of the States are party to it. The Commonwealth can make laws under a referral by some States (not joined in by others) which would apply to some parts of Australia and not to others. When considering implementation of a National Competition Policy this would seem to be an unacceptable outcome. On the other hand, there are aspects of National Competition Policy, exemplified by the National Electricity Market, where geographical realities meant that in its early stages Western Australia and the Northern Territory had not formed part of it.

33 The TPA is a law of the Commonwealth. It prevails over inconsistent State laws which are invalid to the extent of the inconsistency. Inconsistency may be direct or indirect. Direct inconsistency exists where one law requires what the other forbids, where a State law imposes an obligation greater than that for which the federal law provides or where the State law would qualify or impair or, in a significant respect, negate the essential scheme of the federal law.[28] It also exists where one statute takes away a right conferred by another. [29]

34 Indirect inconsistency arises when the Commonwealth law is intended to deal exhaustively with a particular subject and the State law purports to deal with that subject also.[30] If the Commonwealth Parliament had intended, in the TPA, to provide exhaustively for consumer protection and anti-competitive conduct then it could only have done so with respect to the entities and conduct covered by its legislative powers under the Constitution. It could not exhaustively deal with the conduct of natural persons, unincorporated associations, State government and incorporated bodies not falling within the classes of foreign, trading or financial corporations referred to in s 51(xx).

35 It was made clear from the outset by s 75 of the TPA that Pt V was not intended to exclude or limit the concurrent operation of any laws of a State or Territory. The validity of s 75 was upheld and its statement of legislative intent relied upon to support the conclusion that Pt V was non-exhaustive in R v Credit Tribunal; Ex parte General Motors Acceptance Corporation.[31] But as the Court observed in that case a section which declares that an Act or part of an Act is intended to be exhaustive or non-exhaustive will not be determinative if the Act will not bear the corresponding characterisation.[32] A fortiori, the absence of a s 75 equivalent in Pt IV would not require it to be treated as an exhaustive code on anti-competitive conduct.

36 Part IV contains no purported exclusion of State law. As noted earlier, there were State laws dealing with anti-competitive conduct at the time the TPA was enacted. However as Donald and Heydon wrote in 1978:

There was, on the other hand, a host of State laws dealing with consumer protection matters. However their coverage was not uniform and there were differing enforcement records.[34]

37 When the TPA was enacted there were constitutionally mandated gaps in its coverage both in relation to anti-competitive conduct and in relation to consumer protection. Subsequently, by a process of cooperative action by Commonwealth, State and Territory parliaments, a more comprehensive national coverage was achieved, albeit by a patchwork of laws and adoption arrangements. It is now appropriate to consider that process and where it is today.

38 1987 saw an efflorescence of legislative cooperation between the Commonwealth and the States. It saw the implementation of the ill-fated scheme to allow cross vesting of cases between Federal and State courts. It also saw the enactment by the States of Fair Trading Acts which largely replicated the provisions of Pt V of the TPA but applied them directly to “persons”, a term which included natural persons. However those statutes were not uniform. While they all replicated Pt V of the TPA some contained additional consumer protection provisions. The Fair Trading Acts gave effect to an agreement reached in June 1983 at a meeting of Commonwealth and State Consumer Affairs Ministers that there should be uniform fair trading laws throughout Australia. It does not appear that there was any formal inter-governmental agreement beyond that.[35]

39 A major initiative towards a cooperative approach to a national competition policy was taken by the Commonwealth, State and Territory governments in October 1992 when they agreed to establish an Independent Committee of Inquiry into a National Competition Policy for Australia. This was the Hilmer Committee. The Committee reported in August 1993 with six principal recommendations:

40 At its meeting on 25 February 1994 the Council of Australian Governments (COAG) accepted the Competition Policy Principles set out in the Hilmer Report. In its communiqué issued following the meeting COAG stated that it had agreed that:

41 The National Competition Council has described the principles set out in the communiqué as forming the basis of three intergovernmental agreements made in April 1995 which established Australia’s National Competition Policy.[36] The three agreements were:

42 The object of the Competition Principles Agreement was stated in its Preamble:

The Agreement was not a model of legal drafting excellence. It was a political document, not a legal one.[37] It began with an interpretation provision in cl 1. Clause 2 provided for “Prices Oversight of Government Business Enterprises” and assigned primary responsibility for it to the State or Territory that owned the relevant enterprise. A commitment to consider the establishment of “independent sources of price oversight where these do not exist” was made in cl 2(3).

Each of the parties to the agreement was free to determine its own agenda for the implementation of competitive neutrality principles. Corporatisation rules were to be adopted where appropriate for government business enterprises. Such enterprises were to be subject to:

Clause 4 provided for the structural reform of public monopolies. Before introducing competition to a sector traditionally supplied by a public monopoly the party controlling it would remove from the monopoly any responsibilities for industry regulation (cl 4(2)).

44 Clause 5 of the Competition Principles Agreement provided for a review of legislation and stated its guiding principle thus:

45 Clause 6 dealt with access to services provided by means of “Significant Infrastructure Facilities”. The Commonwealth was to prepare legislation to establish a regime for third party access to services provided by means of such facilities where:

There was a saving for States or Territories where there was in place an access regime which covered the facility and conformed to the principles set out in cl 6. This exemption did not apply where the National Competition Council determined the regime was ineffective having regard to the influence of the facility beyond the jurisdictional boundary of the State or Territory or where substantial difficulties would arise from the facility being situated in more than one jurisdiction.

46 Clause 7 applied the principles set out in the Competition Principles Agreement to local government with each State and Territory party taking responsibility for that application of those principles.

47 The National Competition Council was defined in the interpretation clause as that established by the TPA. By cl 8 the Commonwealth undertook responsibility for funding it. Under cl 9 an appointment to the Council was subject to a majority of the States and Territories supporting the proposed appointee. The Agreement was to be reviewed after five years operation (cl 15).

48 The second of the three agreements was the Conduct Code Agreement. Its stated objective was as for the Competition Principles Agreement. It referred to the Competition Code which replicated Pt IV of the TPA and was defined by reference to the then foreshadowed:

49 The Conduct Code Agreement contemplated that State or Territory Parliaments might make laws exempting certain conduct from the application of Pt IV of the TPA and the Competition Code in reliance upon s 51 of the TPA. The party responsible for the legislation would be required to send written notice of it to the Australian Competition and Consumer Commission within 30 days of the legislation being enacted or made. Clause 2 contemplated a report from the National Competition Council on the costs and benefits of the legislation and on whether the Commonwealth should make regulations for the purposes of s 51(1B)(f) of the TPA.

50 Under the Conduct Code Agreement the Commonwealth took responsibility for funding the Australian Competition and Consumer Commission. There was a consultative process relating to appointments to the Commission. As with the Council, a person could not be appointed as a chairperson, deputy chairperson or member of the Commission unless a majority of the fully participating jurisdictions supported, or were taken to support, the appointment.

51 Importantly, the parties agreed that the Competition Code text should be applied by way of “application legislation to all persons within the legislative competence of each State and Territory”.[38] That is to say, it contemplated the adoption by the States of common form laws. The Agreement attempted to avoid the development of differences following the initial adoption. Clause 6 (1) provided:

The Commonwealth committed to consulting with other parties before putting forward for parliamentary consideration any modification of Pt IV of the TPA or to the Competition Code. At the conclusion of such consultation, the Commonwealth was required to call a vote on the proposed amendments by sending a notice to each party. It would have two votes, and each of the other parties would have one. The Commonwealth would also have the casting vote. The Commonwealth agreed not to put forward for parliamentary consideration an amendment to the Competition Code text unless a majority of the votes of the Commonwealth and the other parties supported the amendment.

52 The third agreement was the Implementation Agreement. Under that Agreement the Commonwealth committed itself to making national competition policy payments to each State and Territory in the period 1997-1998 to 2005-2006 if that State and Territory had made satisfactory progress against their obligations under the National Competition Principles and related reforms.

53 Legislative implementation of the Competition Principles Agreement and the Conduct Code Agreement at the Commonwealth level was effected by the Competition Policy Reform Act 1995. By that Act:

54 Of major importance was the provision for third party access to facilities. It was effected by the enactment of the new Pt IIIA. Part IIIA applies to facilities of national significance. The National Competition Council can recommend that a service provided by such a facility be declared by the designated minister. It cannot so recommend if the service is already the subject of an effective access regime established by a State or Territory. Division 3 which provides for notification and arbitration of access disputes by the Commission, its review by the Australian Competition Tribunal and appeals to the Federal Court on questions of law, is limited by reference to the corporations and trade and commerce powers. Section 44R provides:

(a) the provider is a corporation (or a partnership or joint venture consisting wholly of corporations); or

Part IIIA leaves intact State laws providing access regimes where they are declared effective. To the extent that such laws fall outside the scope of the corporations power and the trade and commerce power they would, in any event, be legally effective.

55 The Competition Policy Reform Act 1995 and successive amendments also introduced provisions into the TPA along the lines of s 75, which itself applied only to Pt V, preserving the concurrent operations of State and Territory laws.[42]

56 Part XIA, the Competition Code, was introduced to facilitate the application of the Competition Code by participating States and Territories.[43] State or Territory application laws were permitted to confer functions or powers on Commonwealth entities.[44]

57 Before the amendments the TPA did not bind the Crown in right of the States. The High Court so held in Bradken Consolidated Ltd v Broken Hill Pty Co Ltd.[45] No intention to bind the Crown in right of the States appeared by express words or necessary implication in the Act. The presumption against construing statutes as binding the Crown was relaxed somewhat in Bropho v Western Australia[46] but that change did not affect the constructional outcome in Bradken.[47] The amendments to the TPA marked a significant shift in its application, albeit it still did not bind the Crown outside the circumstances defined by the relevant amendments.[48]

58 Each of the States and Territories enacted competition policy reform statutes adopting the Competition Code text. All, save Western Australia, enacted their application legislation by 21 July 1996. Western Australia’s Act was not assented to until 31 October 1996. It was deemed to commence on 21 July 1996. By way of example, s 5 of the Competition Policy Reform (NSW) Act 1995 provided:

(1) The Competition Code text, as in force for the time being, applies as a law of New South Wales.

Section 6 dealt with future modifications to the Competition Code text. Such modifications would not apply under s 5 until at least two months after the date of the modification unless an earlier date is appointed by proclamation. This appears to have had the effect that a law of the Parliament of New South Wales has a content which varies, without legislative action by the New South Wales Parliament, according to changes in the content of the Commonwealth law. Although the New South Wales Act along with the other State and Territory Acts conferred jurisdiction on the Federal Court in matters under their Competition Codes, that conferral, to the extent that it was made by States, fell with the decision of the High Court in Re Wakim.[49]

59 Constitutional complications arose in relation to the conferring upon the National Competition Council, the ACCC and the Australian Competition Tribunal, of powers, functions and duties under State law. These problems arose out of the decision of the High Court in R v Hughes[50]. That case concerned the conferral on the Commonwealth Director of Public Prosecutions prosecutorial functions for offences against the former Corporations Law (WA), a State law. It was authority for the propositions that:

60 A Commonwealth law may permit a Commonwealth authority to exercise a non-obligatory function conferred on it by State law. It does not require the support of any express Commonwealth head of power.[52] If, however, a State law purports to impose a duty on a Commonwealth body then it seems that the duty must be authorised and indeed imposed by Commonwealth law supportable by a reference to a head of Commonwealth legislative power. Where there is an inter-governmental agreement imposing duties upon Commonwealth officers to carry out functions under State law, then a Commonwealth law imposing that duty is arguably an exercise of the incidental power under s 51(xxxix) in aid of the executive power of the Commonwealth under s 61.

61 There are a number of provisions in the TPA relating to functions conferred upon the National Competition Council, the Australian Competition and Consumer Commission and the Australian Competition Tribunal which attempt to address these problems. They follow a common form so it is sufficient to go to an example. Section 44ZZM, in Pt IIIA, deals with the conferral of powers and functions under State or Territory access regimes on the Commission and the Tribunal. It provides:

(3) The Commission or Tribunal cannot perform a duty or function, or exercise a power, under a State or Territory access regime law unless the conferral of the function of power, or the imposition of the duty, is in accordance with an agreement between the Commonwealth and the State or Territory concerned.

The provision seeks to avoid constitutional limitations[53] and invokes the incidental power by requiring that the function, power or duty conferred “is in accordance with an agreement between the Commonwealth and the State or Territory concerned”.[54]

62 Section 44ZZMA plots a careful path through constitutional thickets. If the State can impose a duty on the Commonwealth body, with the consent of the Commonwealth, and the duty would be consistent with constitutional doctrines, then it will operate by force of State law alone.[55] However, if the imposition of the duty requires support of Commonwealth laws then that support is made available:

Similar provisions are to be found in relation to the conferring of functions on any “Commonwealth entity” under the Competition Code as adopted by State application laws.[56] The conferral of State functions under the Gas Access Law was discussed by the Full Court in Australian Competition and Consumer Commission v Australian Competition Tribunal[57], a judgment, an appeal from which is currently reserved by the High Court although not on that question.

63 The form of s 44ZZMA leaves some uncertainty about when a Commonwealth entity is discharging a duty conferred on it by State law alone and when it is discharging a duty conferred on it by State law and also by operation of Commonwealth law.

64 The question then arises whether a function carried out by a Commonwealth body operating under State law, is amenable to judicial review in the exercise of federal jurisdiction. As originally enacted the law of each of the States applying the Competition Code in that State also applied Commonwealth administrative laws, including the Administrative Decisions (Judicial Review) Act 1997(Cth) (ADJR Act) as laws of the State “to any matter arising in relation to the Competition Code of this jurisdiction as if that Code were a law of the Commonwealth and not a law of this jurisdiction”.[58] So far as it related to the ADJR Act, the provision was linked with the conferral of jurisdiction of the Federal Court under the State Act. The ADJR Act as so applied was State law and the purported conferral of jurisdiction in the Federal Court fell with the decision of the High Court in Re Wakim.

65 The Wakim problem was addressed by an amendment to the ADJR Act itself, effected by the Jurisdiction of Courts Legislation Amendment Act 2000. The application of the ADJR Act was extended beyond decisions under Commonwealth enactments to “an Act of a State, the Australian Capital Territory or the Northern Territory or a part of such an Act described in Schedule 3 …”.[59] Schedule 3 included in its list of enactments any Act of a State or Territory “that applies, as a law of the State [or Territory] the text set out in Part 1 of the Schedule to the Trade Practices Act 1974 of the Commonwealth (which forms part of what is commonly known as the Competition Code)”. Also listed are State and Territory laws applying the new Tax System Price Exploitation Code set out in Part 2 of the Schedule to the TPA. The Gas Pipeline Access (South Australia) Act 1997 and the National Electricity (South Australia) Act 1996 and the relevant application Acts of States or Territories are included.

66 The application of the ADJR Act to the gas law was considered in Australian Competition and Consumer Commission v Australian Competition Tribunal.[60] The Explanatory Memorandum to the Bill amending the ADJR Act stated that:

67 A Federal Act cannot create federal jurisdiction in matters arising under a State law simply by saying that it does. In this case what appears to be relied upon is that the repositories of the functions conferred by the State laws are Commonwealth bodies. In ACCC v Australian Competition Tribunal the Court held that it had jurisdiction because the Tribunal, whose decision under the Gas Access Law was under review, was a Commonwealth body. Jurisdiction in matters in which the Commonwealth is a party can be conferred under s 75(iii) of the Constitution. The Court also held that it had jurisdiction to issue constitutional writs under s 39B of the Judiciary Act 1903 (Cth).

68 In 1989 the Industry Assistance Commission delivered a report to the Commonwealth Treasurer in which the gas and electricity industries were described as particularly inefficient.[61] In 1989 the Treasurer asked the newly formed Industry Commission to report on institutional or regulatory or other arrangements, subject to influence by governments, which led to inefficient resource use in the electricity and gas sectors and to advise how such inefficiencies might be reduced or removed. This led to a report in 1991 which concluded that there was an urgent need for reform of the electricity and gas sectors.[62] The primary source of inefficiency was said to be the lack of commercial discipline imposed by competition.

69 A Special Premiers’ Conference was held in 1991 involving the Commonwealth and the heads of all States and Territories apart from Western Australia and the Northern Territory. At that conference it was agreed that a National Grid Management Council (NGMC) be established to consider arrangements for an interstate electricity network. The Council was to prepare a draft protocol which would cover the planning, operation, development, monitoring and extension of the eastern and southern Australian electricity grid.[63]

70 In May 1992 the COAG was established and the NGMC was asked to submit its recommendations to that body. It proposed the establishment of a competitive national market in the trading of electricity and made recommendations about features of that market including:

The recommendations of the Hilmer Inquiry came a few months after those of the NGMC.

71 Under the Implementation Agreement, concluded between Australian heads of government following the Hilmer Inquiry, it was made a condition of Commonwealth competition payments to the States and Territories that they effectively implement all COAG agreements on electricity arrangements through the National Grid Management Council and the National Framework for Free and Fair Trade in Gas.

72 The National Electricity Market Legislation Agreement was entered into in May 1996 between New South Wales, Victoria, Queensland, South Australia and the Australian Capital Territory. Each agreed to enact a National Electricity Law (NEL) with South Australia as the lead jurisdiction. The NEL was a schedule to the National Electricity (South Australia) Act 1996. It was applied as a law of South Australia by s 6 of that Act. It was also applied and adopted as a law of Victoria, New South Wales, Queensland and the ACT.[65]

73 Under the NEL as adopted by the States, ministers of the participating jurisdictions could approve a Code of Conduct called the National Electricity Code as the initial Code for the purposes of the Law. The Code was to be supervised, administered and enforced by the National Electricity Market Management Corporation Ltd (NEMMCO) which was a corporation limited by guarantee. The provisions of the Code were not given the force of statute although the NEL provided for civil penalties for breaches of the Code. The Code was authorised by the ACCC under s 88 of the TPA in 1997. Those parts of it dealing with transmission and distribution networks were accepted as an Industry Access Code under s 44ZZAA of the TPA.

74 The National Electricity Market (NEM) was the designation given to the institutional arrangements for trading electricity in Queensland, New South Wales, Victoria and South Australia. Section 9 of the law prohibited any person:

1. From owning, controlling or operating a generating, transmission or distribution system unless the person was registered as a Code participant in accordance with the Code.

2. Other than NECA and NEMMCO, from administering or operating a wholesale market for electricity generating units or loads.

3. Purchasing electricity from NECA or NEMMCO unless the person was registered as a Code participant.

Each of the participating States and Territories in the NEM developed complementary reforms within their own borders. The Victorian government decided to privatise the electricity industry in conjunction with its competitive reforms.

75 The NEM commenced operation on 13 December 1998. Its practical operation was described in Australian Gas Light Company v Australian Competition and Consumer Commission.[66] It interacted with price control legislation in the States. By the Electricity Industry Act 1993 (Vic) the State Electricity Commission of Victoria was split into four functional activities for the purposes of privatisation. They were generation, transmission, distribution and retail. Restrictive cross ownership rules were also introduced. A licensing regime was established under which new privatised entities operating in the electricity supply industry in Victoria would be regulated. After the privatisation process was completed a new Electricity Industry Act 2000 (Vic) was enacted. The regulatory and licensing regime established in 1993 was re-enacted subject to some amendments. The distribution prices were set by a tariff order and by the Office of the Regulator General under the Office of the Regulator-General Act 1994 (Vic). The Regulator-General’s function was taken over by the Essential Services Commission, established under the Essential Services Commission Act 2001 (Vic).

76 The NEM was described in a useful overview in a report considered by COAG in April 2007.[67] The report stated:

77 In November 1997 a National Pipeline Access Agreement was signed between the Commonwealth, State and Territory governments. The parties recognised that certain gas transmission pipeline systems are natural monopolies and require regulation in relation to the granting and terms of access. Under the Agreement South Australia passed a Gas Pipelines Access (South Australia) Act 1997 (SA) known as the SA Gas Act. Schedule 1 of the Act was entitled “Third Party Access to Natural Gas Pipelines”. Schedule 2 set out the National Third Party Access Code for Natural Gas Pipeline Systems. The two schedules together comprised what was called the Access Law. Schedule 2 by itself was referred to as “The Code”. The other States, the Northern Territory and the Australian Capital Territory passed laws which adopted the provisions of the South Australian Act and applied the Access Law and Code as laws of those States and Territories. The Commonwealth enacted the Gas Pipelines Access (Commonwealth) Act 1998 (Cth) which applied to the adjacent area, the external areas (other than Norfolk Island and Antarctica) and the Jervis Bay territory.

78 The Code came into effect on 14 August 1998. Under the National Regulatory Scheme so adopted there is provision for regulation of access to, and use of, pipelines by “relevant regulators”. Functions were conferred on the ACCC. The Code also provided for a relevant appeal body which could be the Australian Competition Tribunal. The Code applied to pipelines which are “covered” by it.

79 Under the scheme implemented pursuant to these arrangements, the ACCC and the Australian Competition Tribunal were empowered to perform functions as “relevant regulator” and “relevant appeals body” under the Access Laws of the participating jurisdictions. Exercise of these functions and powers is supported by provisions of the TPA to which reference has already been made.[69]

80 In June 2001 COAG established a Ministerial Council on Energy (MCE) to provide national oversight and coordination of energy policy development. It also set up an independent review of energy market directions: The Parer Review. On 11 December 2003 the MCE submitted to COAG the report entitled “Reform of Energy Markets”. The members of COAG then resolved to make the Australian Energy Market Agreement. That agreement replaced the National Electricity Market Legislation Agreement of 9 May 1996. It also prevailed, to the extent of any inconsistency, over the National Gas Pipeline Access Agreement of 27 November 1997. The agreement confirmed the MCE as the “national policy and governance body for the Australian energy market including for electricity and gas”.[70]

81 The parties to the AME Agreement agreed that the Australian energy market institutions would comprise:

82 Each of the parties agreed “to develop and implement a national legislative framework for the energy market comprising the Australian Energy Market Legislation with uniform application and effect within each Party’s jurisdiction”.[72] The Commonwealth agreed to submit to the Commonwealth Parliament legislation to establish the AER and enable the conferring upon it of functions and powers in respect of electricity and gas. It would also apply the NEL as appropriate as a law of the Commonwealth of Australia and confer functions and powers in respect of electricity and natural gas on the AEMC and the AER enabling them to exercise those functions and powers within the jurisdiction of the Commonwealth. South Australia agreed to submit to its parliament legislation establishing the AEMC and conferring powers and functions on it in respect of electricity and natural gas. It would confer functions on the AER enabling it to exercise its functions and powers in South Australia and would make consequential amendments to the Electricity Legislation and the Gas Legislation.

83 Western Australia would submit legislation to its parliament to confer powers and functions on the AEMC, in respect of natural gas only, enabling the AEMC to exercise its functions and powers in Western Australia. At its discretion it will elect whether to become subject to the jurisdiction of the AEMC and the AER in respect of electricity or of the AER in respect of natural gas. The position of the Northern Territory was not unlike that of Western Australia. Each of New South Wales, Victoria, Queensland, Tasmania and the Australian Capital Territory agreed to submit to its parliament implementing legislation to confer powers on both the AEMC and the AER in respect of electricity and natural gas. Amendments to the legislation could only be made with the agreement of the MCE.[73]

84 The Trade Practices Amendment (Australian Energy Market) Act 2004 No 108 of 2004 introduced a new Pt IIIAA to the Act and established the AER.[74] The AER was given any function conferred under a law of the Commonwealth or prescribed by regulation.[75] Part IIIAA contained provisions consenting to the conferral of future powers and duties conferred on the AER by State and Territory Energy Laws. These followed the format of like provisions elsewhere in the Act, to which reference has already been made.[76]

85 The AER could apply to the Federal Court for injunctions or penalties against persons in respect of:

The term “Uniform Energy Law” refers to the South Australian Electricity Legislation and other State or Territory laws which relate to energy or are prescribed by regulation.[77] The South Australian Energy Legislation means the National Electricity Law set out in the schedule to the National Electricity (South Australia) Act 1996 as in force from time to time together with rules and regulations made under it.[78]

87 The Australian Energy Market Agreement was amended by COAG in June 2006. The amendments were designed to provide for:

. Transfer of retail and distribution regulation (other than retail pricing) to a national framework in an agreed timeframe;

. Agreement to implement national distribution and retail functions in new national laws by 1 January 2008;

. Agreement of the longer term funding arrangements for the National Energy Institutions;

. A process for providing advice to jurisdictions on the effectiveness of competition in retail markets;

. Arrangements for the certification of energy access regimes on a nationally consistent basis.[79]

88 A new legal structure was also agreed consistently with the change in governance arrangements for economic regulation in the industry. These changes were summarised in the Statement of Scope by the Standing Committee of Officials. The legal framework for economic regulation in both electricity and gas was modified to consist of:

. The law (National Electricity Law (NEL) and National Gas Law (NGL)), to be modified by parliaments, consistent with the processes set out in the AEMA;

. Statutory rules (National Electricity Rules (NER) and National Gas Rules (NGR)) initially made by the South Australian Energy Minister on the recommendation of the MCE, with the AEMC being responsible for the Rules and the amendment process in accordance with the procedure set out in the NEL and NGL;

. Regulations under the NEL and NGL, limited to minor process and procedural matters in the NEL and NGL and the prescription of civil penalties;

. Statements of policy principle from the MCE to the AEMC subject to the procedures set out in the NEL and NGL. Access related parts to those instruments were to be submitted for certification under Pt IIIA of the Trade Practices Act 1974 through coordinated and concurrent State and Territory applications.[80]

89 The current operation of the NEM is helpfully described in the National Overview Report to COAG on Australia’s Infrastructure dated April 2007:

91 The ongoing pace of energy market reform casts an air of contingency over current institutional arrangements for competitive markets. At its meeting in February 2006, COAG recommitted to the broad ranging reforms implemented by the MCE and set up the Energy Reform Implementation Group (ERIG) to develop proposals for:

92 ERIG reported to COAG in January 2007.[82] It commissioned consultants to prepare reports on various aspects of the electricity market.[83] None of the reports however appear to have addressed the efficiency of the Commonwealth/State legislative arrangements in place pursuant to the Australian Energy Market Agreement.

93 In its response to the ERIG report COAG affirmed its confidence in the new energy market governance arrangements created in 2004-05. It endorsed recommendations from ERIG to further improve energy market governance through:

COAG agreed to establish a single industry funded NEMO for both electricity and gas “.. to strengthen the national character of energy market governance”. It also noted that the MCE had made progress in considering the establishment of a national Gas Market Operator (GMO). The GMO, if established, would be expected to subsume gas market functions of BEM Corp, the Gas Market Company (GMC) and the Retail Energy Market Company (REM Co) and to take responsibility for the operation of a bulletin board and short term trading market for gas.

94 ERIG observed that the national character of the energy market would be improved if Western Australia and the Northern Territory energy markets were administered by the AER, AEMC and NEMMCO. The Australian Energy Market Agreement, as noted above, allows for WA and the Northern Territory to adopt the national institutions at their discretion. New market arrangements have recently commenced in Western Australia. COAG was of the view that those arrangements need time to settle. It also noted that the Northern Territory has agreed to review adoption of national institutions for its market by the end of 2007. Governments of Western Australia and the Northern Territory indicated that they would monitor the outcome of local and national energy market developments on an ongoing basis and consider the adoption of national institutions consistent with the AEMA.

95 The ongoing development of the national energy market in both electricity and gas relies upon a complex array of inter-jurisdictional laws. Institutions are established to support the operation of the market exercise functions conferred on them by Commonwealth, State and Territory laws. The legislation leaves open some uncertainty about the circumstances in which institutions are exercising State or Commonwealth functions. Questions may also arise about whether the Federal Court is in some cases being called on to enforce a State law outside the framework of federal jurisdiction.

96 The evolution of the NEM seems to be progressing towards horizontal regulatory integration and is not likely to be reversed. It would be a small step in concept but possibly a larger step in efficiency if the States were simply to refer to the Commonwealth for the purpose of making comprehensive federal energy market laws. Safeguards against unilateral amendment and any erosion of State or Territory involvement in the oversight of the market could be built into a text reference as suggested earlier in this paper. The administration of laws passed pursuant to the referral could continue within the framework of an inter-governmental agreement that would look very much like the Australian Energy Market Agreement and be subject to the continuing oversight of the MCE and of COAG.

97 In the search for efficiency, it is necessary to be concerned as much with the complexity and transaction costs associated with legislative schemes as well as with substantive reforms.

98 This paper has been concerned with cooperative arrangements between Commonwealth, States and Territories in the development of National Competition Policy. These arrangements, as noted at the outset, are made to overcome boundary issues arising from the allocation of legislative power under the Constitution. No separate consideration has been given to the effect of international agreements. The Commonwealth has power under s 51 to make laws with respect to external affairs. The enactment of domestic legislation to give effect to international treaty obligations is a well recognised aspect of that power. In this context it is notable that the Australia-United States Free Trade Agreement makes provision, in Chapter 14, for competition-related matters.

99 In a guide to the Agreement published by the Department of Foreign Affairs and Trade it is pointed out that the competition-related matters chapter permits the parties to take measures to:

It is said that these objectives recognise that business conduct which is anti-competitive or that defrauds, deceives or misleads consumers has the potential to restrict financial trade and investment in addition to impairing the welfare of the citizens of either country.

100 Time does not permit a detailed consideration of the provisions of Chapter 14 of the Agreement. They appear however to be comprehensive and raise the question whether, and to what extent, they would support comprehensive Commonwealth legislation unconstrained by the limits of the powers upon which the TPA itself currently relies. That is perhaps the topic for another day.

[1] Sawer G, Modern Federalism (Pitman, 1976) p 2

[2] Constitution ss 106 and 107

[3] Constitution s 109

[4] Constantine L, Anti Trust Federalism, (29 Washburn LJ, 1989-1990) p 163; Millon D, The First Anti Trust Statute (29 Washburn LJ, 1989-1990) p 141; Majoras DG, Anti Trust and Federalism – Address to New York State Bar Association, 23 January 2003; Posner R, “Federalism and the Enforcement of Anti Trust Laws by State Attorneys-General” in Epstein RA and Greve MS (eds); Competition Laws in Conflict (AEI Press, 2004) p 252; De Bow M, “State Anti Trust Enforcement: Empirical Evidence and a Modest Reform Proposal” in Epstein and Greve, op cit, p 267

[5] Middleton K, Blackstone’s UK & EC Competition Documents (4^th Ed, Oxford University Press, 2006) p 262

[6] Constitution s 51(i)

[7] Constitution s 51(xiii)

[8] Constitution s 51(xiv)

[9] Constitution s 51(xviii)

[10] Constitution s 51(xx)

[11] Constitution s 51(xxix)

[12] Constitution s 51(xxxix)

[13] (2000) 202 CLR 535

[14] Constitution s 51(xxxvii)

[15] Profiteering Prevention Acts of 1920 and 1923 (Qld), the Monopolies Act 1923 (NSW), the Fair Prices Act 1924 (SA) and the Prices Act 1963( SA), the Unfair Trading and Profit Control Act 1956 (WA) and the Trade Associations Registration Act 1919 (WA)

[16] J Kitchener & Sons Pty Ltd v Stewarts’ Cash and Carry Stores [1942] HCA 18; (1942) 66 CLR 116; Attorney-General v Brickworks Pty Ltd [1941] NSWStRp 1; (1941) 41 SR(NSW) 72 and Cockburn Cement Pty Ltd v Wallwork [1958] WALawRp 4; (1958) 59 WALR 75; R v Wallwork; Ex parte Cockburn Cement Ltd [1957] WALawRp 9; (1957) 59 WALR 49

[17] Walker G. de Q. , Australian Monopoly Law: Issues of Law, Fact and Policy (Melbourne, FW Cheshire Pty Ltd, 1967) p 35

[18] Strickland v Rocla Concrete Pipes Pty Ltd (1971) 124 CLR 468

[19] Mildura Fruit Juice Pty Ltd v Bannerman (1983) 67 FLR 1

[20] Re Wakim; Ex parte McNally (1999) 198 CLR 511

[21] As exemplified in the offshore settlement under which the States were given legislative power up to three miles seaward of low water mark: Coastal Waters (State Powers) Act 1980 (Cth) upheld in Port MacDonnell Professional Fishermen’s Association v South Australia [1989] HCA 49; (1989) 168 CLR 340

[22] New South Wales v The Commonwealth (1990) 169 CLR 482

[23] Re Wakim; Ex part McNally (1999) 198 CLR 511

[24] Byrnes v R [1999] HCA 38; (1999) 199 CLR 1; Bond v R [2000] HCA 13; (2000) 201 CLR 213; R v Hughes (2000) 202 CLR 535 and McLeod v Australian Securities and Investments Commission [2002] HCA 37; (2002) 191 ALR 543 and see generally De Costa, The Corporations Law and Cooperative Federalism after the Queen v Hughes (22 Syd Law Rev, 2000) p 245; McConvill and Smith, Interpretation and Cooperative Federalism; Bond v R from a Constitutional Perspective (29 Fed Law Rev, 2000) p 75.

[25] R v The Public Vehicles Licensing Appeals Tribunal; Ex parte Australian National Airways Pty Ltd [1964] HCA 15; (1964) 113 CLR 207 at 224-225 where the High Court appears to proceed on the assumption that the referral of a specific Bill will support a law made in the terms of that Bill.

[26] Graham v Patterson 195 CLR 1 at 25; Airlines of New South Wales v New South Wales [1964] HCA 2; (1964) 113 CLR 1 at 53; R v Public Vehicles Licensing Appeals Tribunal 113 CLR at 226; Sande v Registrar, Supreme Court (Qld) (1996) 64 FCR 123 at 131.

[27] Airlines of New South Wales 113 CLR at 38, 30 and 53 and see Anderson R, Reference of Powers by the States to the Commonwealth [1951] UWALawRw 1; (1951) 2 UWAL Rev 1, 7-8; Lumb RV and Moens G ,The Constitution of the Commonwealth of Australia Annotated (6^th ed, Sydney, Butterworths, 1995) at [400]; cf Wynes WA, Legislative, Executive and Judicial Powers in Australia (5^th ed, Law Book Co, 1976) at 171

[28] Telstra v Worthing(1999) 197 CLR 61 at 76

[29] Clyde Engineering Co Ltd v Cowburn (1926) 37 CLR 466 at 478

[30] Clyde Engineering at 489; Re Macks; Ex parte Saint [2000] HCA 62; (2000) 204 CLR 158 at 178 (Gleeson CJ)

[31] [1977] HCA 34; (1977) 137 CLR 545

[32] R v Credit Tribunal; Ex parte General Motors Acceptance Corporation at 563 (Mason J)

[33] Donald BG and Heydon JD, Trade Practices Law (Law Book Co, 1978) at 1.2.1 citing the following statutes: NSW: Monopolies Act 1923; Consumer Protection Act 1969; Restraints of Trade Act 1976; Vic: Collusive Practices Act 1965; Qld: Profiteering Prevention Act 1948; SA: Prices Act 1963; WA: Trade Associations Regulations Act 1959; Trade Union Act 1902.

[34] Donald and Heydon, op cit at 1.2.2.

[35] Personal communication: Dr J Thompson, Attorney-General’s Office, Western Australia

[36] National Competition Council, Compendium of National Competition Policy Agreements (2^nd ed, June 1998) p 12

[37] The principles are however given statutory recognition in ss 44H, 44G, 44M and 44N of the TPA. They must be applied by the National Competition Council and the Minister in deciding whether an access regime is an effective access regime. By s 44DA they have the status of guidelines rather than binding rules.

[38] Conduct Code Agreement cl 5(1)

[39] TPA s 6A(1)

[40] TPA s 29A

[41] Sections 2B (Pt IV, VB, XIB), 44E (Pt IIIA), 95D (Pt VIIA), 152AD (Pt XIC).

[42] Section 51AAA – Pt IV; s 51AAACA – Pt IVA unconscionable conduct enacted in 2001; s 51AEA – Pt IVB industry codes enacted in 2001.

[43] TPA s 150B

[44] TPA s 150F

[45] [1979] HCA 15; (1979) 145 CLR 107

[46] [1990] HCA 24; (1990) 171 CLR 1

[47] State Superannuation Board v Trade Practices Commission (1982) 60 FCR 165; E v Australian Red Cross Society [1991] FCA 20; (1991) 27 FCR 310; State Government Insurance Corporation v GIO (NSW) [1991] FCA 198; (1991) 28 FCR 511

[48] Where s 2B did not apply Crown immunity remained in place: Northern Territory Power Generation Pty Ltd v Power and Water Authority (2004) 219 CLR 90; Australian Competition and Consumer Commission v Baxter Health Care Pty Ltd [2006] FCAFC 128; (2006) 153 FCR 574, appeal pending in High Court; Lin v State Rail Authority of New South Wales [2003] FCA 1345.

[49] (1999) 198 CLR 511

[50] (2000) 202 CLR 535

[51] Hughes at [31]

[52] R v Duncan; Ex parte Australian Iron and Steel Pty Ltd [1983] HCA 29; (1983) 158 CLR 535 at 563 (Mason J); Re Cram; Ex parte New South Wales Colliery Association Ltd [1987] HCA 28; (1987) 163 CLR 117 at 127

[53] TPA s 44ZM(2)

[54] TPA s 44ZZM(3)

[55] TPA s 44ZZMA(2)

[56] TPA ss 150F, 150FA and 150FB

[57] [2006] FCAFC 83; (2006) 232 ALR 153; 152 FCR 33

[58] Competition Policy Reform (NSW) Act 1995 s 30

[59] ADJR Act s 3

[60] [2006] FCAFC 83; (2006) 232 ALR 153 at [78] – [81]

[61] Industries Assistance Commission, Government (Non tax) Charges (Vol 1, 1989)

[62] Industry Commission Energy Generation and Distribution (Vol 1, 1999) at p 2

[63] Special Premiers’ Conference Communique, 30-31 July 1991

[64] National Grid Management Council, National Electricity Market and Common Trading Arrangements, An Information Paper, January 1993.

[65] National Electricity (Victoria) Act 1997; National Electricity (New South Wales) Act 1997; Electricity-National Scheme (Queensland) Act 1997; Electricity (National Scheme) Act 1997 (ACT).

[66] [2003] FCA 1525; (2003) 137 FCR 317

[67] Australia’s Infrastructure – National Overview Report, April 2007

[68] Australia’s Infrastructure, op cit, at 24

[69] TPA ss 44ZZM, 44ZZMA and 44ZZMB

[70] Australian Energy Market Agreement, Art 4.1

[71] Australian Energy Market Agreement, Art 5

[72] Australian Energy Market Agreement, Art 6.2

[73] Australian Energy Market Agreement, Art 6.5

[74] TPA s 44AE

[75] TPA s 44AH

[76] TPA ss 44AI, 44AJ and 44AK

[77] TPA s 44AB

[78] TPA s 44AB

[79] A National Legislative Framework for Gas and Electricity, July 2006. Statement of Scope, Standing Committee of Officials of the Ministerial Council on Energy

[80] Standing Committee of Officials, op cit, at 7

[81] Australia’s Infrastructure, National Overview Report, April 2007 at 28

[82] Energy Reform – The Way Forward for Australia; A Report to the Council of Australian Governments by the Energy Reform Implementation Group, January 2007.

[83] The Effectiveness of the Trade Practices Act to Guide Mergers in the Australian Electricity Market; Acacia CRE Pty Ltd, 22 November 2006; Review of Energy Related Financial Markets Electricity Trading, KPMG, 2006; Evaluation of Economic Benefits of Reform, Final Report to Electricity Reform Implementation Group, McLennan Magasanik Associates, 8 January 2007; NEMCO Governance Arrangements Final Report, Firecone Ventures Pty Ltd, December 2006.

Federal Judicial Scholarship

French, Justice Robert --- "Horizontal arrangements - competition law and cooperative federalism" (FCA) [2007] FedJSchol 6