Curbing Corporate Collusion in Australia: the Role of Section 45a of the Trade Practices Act

[When s 45A was added to the Trade Practices Act 1974 (Cth) in 1977, price-fixing became illegal per se. Since then a large number of cases have been brought successfully, with much higher pecuniary penalties being ordered in recent times. Following the recommendations of the Dawson Committee, new legislation is likely to be passed in 2005 that recognises the need for even higher pecuniary penalties for Part IV conduct (including price-fixing, an offence that several judges have recently characterised as being of great social concern). Also on the horizon is the prospect of jail terms for executives engaging in price-fixing. This article reviews the history of price-fixing legislation and its enforcement in Australia. It highlights the development of jurisprudence on the identification of price-fixing, and on the appropriate penalties for this offence. It presents statistical evidence on the trend in cases, success rates, the firms and markets involved, and on the actual pecuniary penalty levels. In addition, consideration is given to the form of collusion on prices, whether it took place contemporaneously with other anti-competitive conduct, the length of the pricefixing arrangements and their social effects, the degree of culpability, the availability of ‘smoking gun’ evidence, and the extent to which penalties were fully argued in court or were negotiated with the Australian Competition and Consumer Commission and presented to the court for its approval.]