Playing it by the Book

Contraventions of section 4(1)(b) of the Competition Act are not capable of justification. This creates problems when advising clients in situations where infringement appears technical: no harm or inefficiency results from the conduct and there are rational explanations. This article describes this problem in more detail and proposes solutions.

Introduction
The wording of section 4(1)(b) of the Competition Act is restrictive. An "agreement" between, or "concerted practice" by competitors is prohibited if it involves:

• directly or indirectly fixing a purchase or selling price or any other trading condition;
• dividing markets, by allocating customers, suppliers, territories, or specific types of goods or services; or