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Rares, Justice Steven --- "Introductory remarks for the 2012 Competition Law Conference" (FCA) [2012] FedJSchol 21
INTRODUCTORY REMARKS FOR SESSION ON
ACCC
PRIORITIES IN ENFORCING COMPETITION LAW
Steven
Rares[*]
- I
suppose the Federal Court is really at the cutting edge of what this
session’s topic foreshadows. I wanted to draw attention
to one aspect of
the enforcement of competition law from the perspective of the courts. It is
comprehensibility. That concept has
been ignored by the Treasury drafters of
some of the nation’s most significant legislation. This includes the
byzantine Taxation
laws, the ever growing less and less intelligible
Corporations Act and ASIC Act and, of course, the Competition
and Consumer Act 2010. This last misnamed Act places a fraction of what
once was a comprehensive and comprehensible norm of conduct we all knew as
s 52,
into the microcosm of s 18 of Sch 2 known as the
Australian Consumer Law.
- We
now find other bits of s 52 bizarrely cut up and strewn into the
Corporations Act, the ASIC Act and the Australian Consumer
Law with enormous definitions and provisions specifying each portion’s
discrete roles in the various regulators’ arsenals.
But this senseless
waste of paper costs the community and the courts time and money. Why does it
matter whether you are misleading
or deceptive about a financial product or
service, or a consumer transaction or a market dealing? Surely, if the standard
to be
obeyed is that persons in trade or commerce are not to engage in conduct
that is misleading or deceptive, that is all that needs
to be said in the
legislation. Everyone can understand it. You do not need a team of lawyers to
trace through whether you are liable
under one Act or another. Regrettably, the
idea of simple concepts in legislation is anathema to the present Commonwealth
parliamentary
drafting system.
- Take
another example, the new criminal cartel provisions in Pt IV of the
Competition and Consumer Act. Instead of re-enacting the Trade
Practices Act 1974 or even renumbering it, we now have Division 1 of
Pt IV that begins with s 44ZZRA headed “simplified
outline” – who is this kidding? It is not simple. Imagine a
criminal
trial where everyone in the court is arguing, orally, about sections
that have two numerals and four letters before you hit a subsection.
The United
States has a major competition statute that has driven free enterprise in that
country for a century. It is called the
Sherman Act 1890 amended by the
inaptly named Clayton Act 1914. It is two sections long. The sections
are not themselves long. They are elegant, simple prose. The Chinese Anti
Monopoly Law of 2008 is 57 sections long. Art 19 provides, very
simply:
“Article 19 Where a business operator is under any of the following
circumstances, it may be assumed to be have a dominant market
position:
(1) the relevant market share of a business operator accounts for 1/2 or above
in the relevant market;
(2) the joint relevant market share of two business operators accounts for 2/3
or above; or
(3) the joint relevant market share of three business operators accounts for 3/4
or above.
A business operator with a market share of less than 1/10 shall not be presumed
as having a dominant market position even if they
fall within the scope of
second or third item.
Where a business operator who has been presumed to have a dominant market
position can otherwise prove that they do not have a dominant
market [position],
it shall not be determined as having a dominant market
position.”
- The
Chinese legislation is concept driven and easily understood. The May 2011
reprint of the Competition and Consumer Act is only 1414 pages long.
- Why
does Australia need hundreds if not thousands of pages of legislation in which
to express almost every major enactment? The more
words, the harder it is to
identify the right, liability, or standard of behaviour that the law has
established. It is not just
a fussy judge who has this morass to wade through.
Accountants, lawyers, businesses, right down to the corner shop, all have to
deal with mega-regulation such as is in the Australian Consumer Law or
the Taxation legislation.
- In
his second reading speech for the Trade Practices Amendment (Australian
Consumer Law) Bill 2009, the Minister for Small Business, Independent
Contractors and the Service Economy, Minister Assisting the Finance Minister on
Deregulation
and Minister for Competition Policy and Consumer Affairs, the Hon
Craig Emerson MP, explained that one, commendable objective of
all the
nation’s Parliaments was to reform and streamline federal, State and
Territory consumer protection laws into one cognate
Act. He said, without
intentional irony:
“As we move towards a single, national market—a seamless national
economy as called for by the Business Council of Australia
and the 2020
Summit—this tangle of consumer laws must be rationalised. We must reduce
confusion and complexity for consumers
and provide consistency of consumer
protection. We must reduce compliance burdens for
business.”
- Yet
s 131A of the Competition and Consumer Act states that that Act and
all but Pt 5-5 of Sch 2, do not apply to the supply or possible supply
of financial services or products.
Why not? Well, because these provisions are
needed to be largely replicated, but with lengthy definitional labyrinths in
Pt 2 of
the ASIC Act. Of course, that was not the only place to
prohibit misleading and deceptive conduct. I can mention s 1041H of the
Corporations Act with respect to a civil contravention by misleading or
deceptive conduct, in relation to a financial product or service; and then,
of
course, there are the criminal provisions of s 670A, dealing with
misleading or deceptive takeover documents or s 728, dealing
with
misleading or deceptive fundraising documents.
- For
some reason no simplified outline has been enacted for all that. But then these
provisions were drafted to make clear, to judges
like me, propositions such as
are found in s 23EJ(2) of the Federal Court of Australia Act 1976.
No doubt many of you will understand that years of law school, legal practice
and the odd bit of being alive do not equip you to
survive or work out what
s 23EJ(2) provides. It states: “A juror is taken to be discharged if
the juror dies”. Leaving aside the potential for communication
by jurors
with their former colleagues through a Ouija board, it is difficult to think why
the Parliament needed solemnly to enact
this profound law.
- One
of the canons of statutory construction is that an Act must be read as a whole.
The problem we as a nation are facing is that
the Parliament has lost control of
the drafting of legislation. Modern lengthy statutes, amended as they often
are, several times
a year, defy intellectual comprehension. They contain a lot
of overkill. That is not good for legal certainty or predictability.
Lawyers
fight over words. The more words, the more lawyers can find new and hidden,
perhaps unthought of meanings.
- I
think an urgent priority in enforcing competition law, is that it be
conceptualised, synthesised and sent to a drafter who can express
it in plain,
simple and short terms. It would not be hard.
[*] A judge of the
Federal Court of Australia. The author acknowledges the assistance of his
associate Abbey Burke, in the preparation
of this introduction to the second
session of 2012 Competition Law Conference held on 5 May 2012. The errors are
the author’s
alone.
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