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A snuggle for survival – the paradox of section 44ZZRD(3)(c): Restricting co-operation may mean restricting competition

Marianna Parry and Richard Hobson
(2014) 22(3) Australian Journal of Competition and Consumer 201

 

Abstract/summary

In December 2013, the Abbott Government announced that it would undertake a comprehensive root and branch review of competition laws and policy, which promises to examine the current laws, as well as the broader competition framework. It will also look at increasing productivity and efficiency in markets, easing the cost of living pressures, and raising living standards. Since competition law reforms are on the agenda, the authors argue that the balance between competition and co-operation is not established correctly in the current competition framework, as restricting certain forms of co-operation paradoxically restricts competition. This is particularly so in the case of the operation of s 44ZZRD(3)(c) of the Competition and Consumer Act 2010 (Cth), which makes joint bidding and teaming agreements potentially illegal in Australia. In view of the wide interpretation of "likely competitors" in the recent case Norcast SárL v Bradken Ltd (No 2) (2013) 219 FCR 14, the ambit of s 44ZZRD(3)(c) has widened even further. This article argues that it is time for a reform of the operation of s 44ZZRD(3)(c). Considering how teaming agreements and joint bidding are protected and encouraged in United States legislation, it is submitted that Australian businesses will become more competitive locally and globally if this form of co-operation is explicitly protected by the law.

 

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