Easing transtasman trade paperwork

By BRIAN FALLOW

Companies needing the blessing of competition authorities on both sides of the Tasman may in future be able to avoid having to lodge two separate applications.

Finance Minister Michael Cullen told a business breakfast in Sydney yesterday that he and his Australian counterpart, Treasurer Peter Costello, had agreed the two countries should explore ways of improving the integration of their competition regimes.

Measures under consideration include improved information-sharing between the Commerce Commission and the Australian Competition and Consumer Commission (ACCC), a single transtasman application for clearances and authorisations of mergers and restrictive trade practices, and cross-appointments between the two commissions.

New Zealand's Commerce Act is, in many ways, modelled on Australia's Trade Practices Act and the convergence between the two countries' competition laws increased when the Commerce Act was amended in 2001.

The recommendations of the recent Dawson review of the Trade Practices Act, which have been endorsed by the Australian Government, represented a further step towards convergence.

The Dawson committee preserved the provisions with which the New Zealand law had aligned itself in relation to mergers and acquisitions and the abuse of market power.

It adopted New Zealand's penalties provisions and recommended the adoption of a formal clearance process modelled on the Commerce Commission's.

The ACCC has had an informal and rather opaque clearance process for the more straightforward merger applications; it will remain an option for applicants.

But the availability of a New Zealand-style clearance opens the opportunity for introducing a single transtasman merger clearance process, where applicable.

However, it is early days. Officials have not yet talked to their Australian counterparts about how this might work.

For the more complex transactions and arrangements, requiring authorisation rather than clearance - where it is accepted the proposal is anti-competitive but the applicants contend there are public benefits which outweigh that - there are greater differences in process between the two countries.

That may make a common application difficult.

Dawson recommended that in the case of complex authorisations, applicants should be able to save time by going directly to the Australian Competition Tribunal. It is unlikely anybody would suggest the New Zealand High Court should be the first port of call.