Australian Competition and Consumer Commission v Apco Service Stations Pty Ltd

The Australian Competition and Consumer Commission (ACCC) brought proceedings against Apco Service Stations Pty Ltd (Apco) in the Federal Court of Australia. The dispute concerned Apco's alleged contravention of section 45 of the *Trade Practices Act 1974* (Cth) (now section 47 of the *Competition and Consumer Act 2010* (Cth)), which prohibits corporations from making contracts or arrangements or arriving at understandings that have the purpose, effect, or likely effect of substantially lessening competition in a market. The ACCC alleged that Apco had engaged in conduct that substantially lessened competition in the market for the supply of petrol in the Melbourne metropolitan area.

The primary legal issue before the High Court of Australia was whether Apco's conduct had the purpose, effect, or likely effect of substantially lessening competition in the relevant market. This required the Court to consider the nature of Apco's arrangements with its service station operators and to assess the impact of these arrangements on competition within the Melbourne metropolitan petrol market. The Court also had to determine whether the conduct fell within the scope of section 45 of the *Trade Practices Act 1974* (Cth).

The High Court, in allowing the appeal, found that the arrangements between Apco and its service station operators did not have the purpose, effect, or likely effect of substantially lessening competition. The Court reasoned that the agreements, which involved Apco supplying petrol to its franchisees, did not prevent or hinder competition in a substantial way. The Court emphasised that for conduct to contravene section 45, the lessening of competition must be substantial, and in this instance, the evidence did not support such a finding. The Court applied the principles of statutory interpretation to the relevant provisions of the *Trade Practices Act 1974* (Cth), focusing on the meaning of "substantially lessening competition" and the assessment of market power and competitive effects.

The High Court ordered that the appeal be allowed and the orders of the Full Federal Court be set aside. The proceedings in the Federal Court were remitted to that Court for further orders.