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ARTICLE · 22 JULY 2009

Understanding ´Understandings´

Norton Rose Fulbright Australia
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In this article we consider an important proposal by the Australian Competition and Consumer Commission (ACCC) to widen the scope of conduct caught by the cartel prohibitions in the Trade Practices Act (TPA), by extending the meaning of 'understanding.'

AustraliaAntitrust/Competition Law
Andrew Beck
Andrew Beck
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In response to the ACCC's Report of the ACCC inquiry into the price of unleaded petrol (Petrol Report) which suggested amending the meaning of 'understanding' in the TPA, the Treasury has released a discussion paper on the issue calling for submissions. This article considers the proposed amendments, the submissions received and what it could mean for Australian companies.

Background

Section 45 of the TPA prohibits a corporation from "making or giving effect to a provision of a contract, arrangement or understanding if that provision constitutes an exclusionary provision, or if it has the purpose or likely effect of substantially lessening competition."1

In December 2007, the ACCC released its "Petrol Report", following its inquiry into the causes of petrol pricing in Australia. In it, the ACCC expressed concerns that recent court decisions had narrowed the type of conduct that is caught by the term 'understanding' in the TPA by requiring that there be a commitm

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