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Misuse of Market Power: Cases

 

High Court cases

Queensland Wire 1989 (refusal to deal)

Queensland Wire Industries v BHP (1989) 167 CLR 177 (High Court)
Leveraging market power - refusal to deal (breach of s 46 established)

The Court held that BHP had substantial market power and its purpose, in refusing to supply Y-Bar to Qld Ware, was to prevent Qld Wire competing as a manufacturer and wholesaler of star pickets. The refusal was also found to satisfy the 'take advantage' element:

'In effectively refusing to supply Y-bar to the appellant, BHP is taking advantage of its substantial market power. It is only by virtue of its control of the market and the absence of other suppliers that BHP can afford, in a commercial sense, to withhold Y-bar from the appellant. If BHP lacked that market power - in other words, if it were operating in a competitive market - it is highly unlikely that it would stand by, without any effort to compete, and allow the appellant to secure its supply of Y-bar from a competitor.' (Mason CJ and Wilson, para 28)

The High Court equated 'take advantage' with 'use' and noted that this requirement carried with it no moral overtones: 'The words 'take advantage of' do not have moral overtones in the context of s. 46' (Justice Dawson para 9). In making this finding the High Court unanimously rejected the view of Justice Pincus that the phrase 'take advantage' required some pejorative behaviour.

Melway 2001 (refusal to deal)

Melway Publishing Pty Ltd v Robert Hicks Pty Ltd [2001] HCA 13 (High Court)
Refusal to deal, 'taking advantage' (no breach)

Take advantage element not satisfied (evidence suggested market power and anti-competitive purpose elements were satisfied, but there was a 'business justification' for the conduct)

Boral 2003 (predatory pricing)

Boral Besser Masonry Limited v ACCC [2003] HCA 5 (High Court)
Predatory pricing (market power) (no breach)

BBM did not have substantial market power and, even if it did, it did not take advantage of that power.

Rural Press 2003 (threat to compete if competitor did not withdaw)

Rural Press Ltd v ACCC [2003] HCA 75 (High Court)
Threats if competition not withdrawn - not taking advantage of market power (no breach of s 46)

Substantial market power and requisite purpose by not taking advantage of market power (taking advantage of 'financial' power)

If a firm with market power has a purpose of protecting it, and a choice of methods by which to do so, one of which involves power distinct from the market power and one of which does not, choice of the method distinct from the market power will prevent a contravention of s 46(1) from occurring even if choice of the other method will entail it." (Justices Gummow, Hayne and Heydon)

What gave those threats significance was something distinct from market power, namely their material and organisational assets (Justices Gummow, Hayne and Heydon)

NT Power 2004 (denial of access)

 

Federal Court

Federal Court (Full Bench) (chronological)

Seven Network Ltd v News Limited [2007] FCA 1062; [2009] FCAFC 166 (the C7 case)
Anti-competitive agreements; misuse of market power; market definition

Universal Music Australia Pty Ltd v ACCC [2003] FCAFC 193 (Full Federal Court)
Misuse of market power; exclusive dealing, purpose or effect of SLC (no breach of s 46)

External linkACCC v Australian Safeway Stores Pty Limited [2003] FCAFC 149 (Full Federal Court)
Misuse of market power, exclusive dealing, price fixing (breach of s 46 established)

Singapore Airlines Ltd v Taprobane Tours WA Pty Ltd (1991) 33 FCR 158 (Federal Court (Full Court))
Misuse of market power, Market definition

Mark Lyons Pty Ltd v Bursill Sportsgear Pty Ltd (1987) ATPR 40-809; [1987] FCA 282
Sole distributor of a brand of ski boots had substantial market power in Australian ski boot market

External linkWilliams and Vajili Pty Ltd v Papersave Pty Ltd [1987] FCA 351 (Full Federal Court)
Appeal dismissed
"Here we simply have a corporation which handled 60 per cent of the collection and treatment of waste computer paper, seeking to take a lease with no added special features, except a knowledge that a potential competitor also wanted the lease." (para 24)

Appeal from: External linkWilliams & Anor v Papersave Pty Ltd (1987) ATPR 40-818; [1987] FCA 162 (Sheppard J)
Substantial market power and prohibited purpose existed, but not the taking advantage element; taking advantage of information, not taking advantage of market power

External linkWarman International & Ors v Envirotech Australia Pty Ltd & Ors (1986) ATPR 40-714 (Wilcox J)
Enforcing copyright not taking advantage of market power - taking advantage of legal right

Victorian Egg Marketing Board v Parkwood Eggs Pty Ltd (1978) 33 FLR 294; 20 ALR 129; [1978] ATPR 40-081

Federal Court (First Instance) (chronological)

ACCC v Pfizer Australia Pty Ltd [2015] FCA 113 [on appeal]
Misuse of market power (purpose not established), exclusive dealing

ACCC v Cement Australia [2013] FCA 909 (10 September 2013) (Federal Court)
No misuse of market power (taking advantage element not satisfied)

ACCC v Ticketek Pty Ltd [2011] FCA 1489 (22 December 2011) (Federal Court)
By consent - refusal to deal

External linkEastern Express Pty Ltd v General Newspapers Pty Ltd (1991) 30 FCR 385 (Wilcox J)
Predatory pricing

External linkBerlaz Pty Ltd v Fine Leather Care Products Limited [1991] FCA 163; (1991) 13 ATPR 41-118 (Interlocutory proceedings)

'A distinction has to be drawn between purpose and consequence. The clear impression I have gained from the evidence is that FLC's purpose in acting as it did was not to get rid of or damage Berlaz as a competitor, although no doubt FLC knew that terminating the distributorship would be likely to have one or both of those results.' [Pincus J para 25]