Queensland Wire Industries Pty Ltd v The Broken Hill Proprietary Company Limited

Queensland Wire Industries Pty Ltd (QIW) brought proceedings against The Broken Hill Proprietary Company Limited (BHP) and Australian Wire Industries Pty Ltd. The dispute concerned BHP's refusal to supply QIW with Y-bar, a product essential for QIW to manufacture star pickets. QIW alleged that BHP's refusal constituted a contravention of section 46 of the Trade Practices Act 1974 (Cth), which prohibits corporations with substantial market power from taking advantage of that power for anti-competitive purposes. The matter was before the High Court of Australia.

The central legal issue before the High Court was whether BHP's refusal to supply Y-bar to QIW amounted to an improper "taking advantage" of its substantial market power in contravention of section 46 of the Trade Practices Act. Specifically, the court had to determine if BHP's conduct, in refusing to sell a product it manufactured and desired to keep for its own further processing, was done for a purpose that impaired QIW's ability to compete in the market for star pickets and fencing materials.

The court considered whether BHP's reliance on its proprietary rights as the owner of the goods was a sufficient defence to the claim. It was argued on behalf of QIW that BHP's refusal was not merely a decision to retain its product for its own use, but rather an exercise of market power with the specific anti-competitive purpose of preventing QIW's entry into the star picket market and impairing its ability to compete. The court examined whether this conduct fell within the ambit of section 46, which limits the freedom of dominant corporations to carry on business when their actions are motivated by proscribed anti-competitive purposes. The court rejected the contention that a monopolist could simply rely on its ownership of goods as an answer to a claim of misusing market power.