Re 7-Eleven Stores Pty Ltd - [1998] ACompT 3

AUSTRALIAN COMPETITION TRIBUNAL

Trade Practices Act – Newsagents in New South Wales, Australian Capital Territory, Victoria and Queensland – review of determinations made by Australian Competition and Consumer Commission – determinations revoking authorisations of Rules of Newsagency Councils relating to the distribution of newspapers and magazines and granting substitute authorisations – whether material changes of circumstances since authorisations granted – whether authorisations should be revoked – whether it is appropriate to grant further authorisations in substitution for those revoked.

Trade Practices Act (1974) (Cth) ss 90, 91, 101

RE: 7-ELEVEN STORES PTY LTD, INDEPENDENT NEWSAGENTS ASSOCIATION, AUSTRALASIAN ASSOCIATION OF CONVENIENCE STORES INC.

VON DOUSSA J, DR B I ALDRICH & PROFESSOR D K ROUND
SYDNEY
18 NOVEMBER 1998

IN THE AUSTRALIAN COMPETITION TRIBUNAL
NEW SOUTH WALES DISTRICT REGISTRY 6 and 7 of 1997

1, 2 and 3 of 1998

RE: APPLICATION FOR REVIEW OF A DETERMINATION OF THE AUSTRALIAN COMPETITION AND CONSUMER COMMISSION MADE ON 12 DECEMBER 1997 REVOKING THE AUTHORISATION GRANTED IN RESPECT OF APPLICATION FOR AUTHORISATION No. A90368 AND GRANTING A FURTHER AUTHORISATION IN SUBSTITUTION FOR THE REVOKED AUTHORISATION (DISTRIBUTION OF NEWSPAPERS AND MAGAZINES IN VICTORIA) BY 7-ELEVEN STORES PTY LTD, INDEPENDENT NEWSAGENTS ASSOCIATION AND AUSTRALASIAN ASSOCIATION OF CONVENIENCE STORES INC.

APPLICATION FOR REVIEW OF A DETERMINATION OF THE AUSTRALIAN COMPETITION AND CONSUMER COMMISSION MADE ON 12 DECEMBER 1997 REVOKING THE AUTHORISATIONS GRANTED IN RESPECT OF APPLICATIONS FOR AUTHORISATION Nos. A15421, A15422, A15423, A15425, A15426, A15605, A30092 and A30093 AND GRANTING A FURTHER AUTHORISATION IN SUBSTITUTION FOR THE REVOKED AUTHORISATIONS (DISTRIBUTION OF NEWSPAPERS AND MAGAZINES IN NEW SOUTH WALES AND THE AUSTRALIAN CAPITAL TERRITORY) BY THE AUSTRALASIAN ASSOCIATION OF CONVENIENCE STORES INC.

APPLICATION FOR REVIEW OF A DETERMINATION OF THE AUSTRALIAN COMPETITION AND CONSUMER COMMISSION MADE ON 12 DECEMBER 1997 REVOKING THE AUTHORISATIONS GRANTED IN RESPECT OF APPLICATIONS FOR AUTHORISATION Nos. A2061, A2064, A2089 AND GRANTING A FURTHER AUTHORISATION IN SUBSTITUTION FOR THE REVOKED AUTHORISATION (DISTRIBUTION OF NEWSPAPERS AND MAGAZINES IN QUEENSLAND) BY AUSTRALASIAN ASSOCATION OF CONVENIENCE STORES INC.

MEMBERS: VON DOUSSA J (ACTING PRESIDENT), DR B I ALRDRICH, PROFESSOR D K ROUND
DATE OF DETERMINATION: 18 NOVEMBER 1998
WHERE MADE: SYDNEY

INDEX

Introduction
           1.1      Newsagency Council of Victoria
           1.2      Newsagency Council of NSW and ACT
           1.3      Newsagency Council of Queensland
           1.4      Authorised newsagents and sub-agents
           1.5      The applications
History of Authorisations under the Act
The Relevant Law
The Authorised Systems and their Operation
           4.1      The substance of the authorised conduct
           4.2      Differences between the States
           4.3      Impacts on the conduct of other retailers
Material Change of Circumstances
           5.1      Changes of circumstances identified by the Commission
           5.2      Changes in regard to the distribution of magazines
           5.3      Conclusions
Should the 1980-1985 Authorisations be Revoked?
6.1The evaluation of net public benefit in 1994
6.2      Strategic responses of publishers and newsagents after 1994
  6.2.1    Responses by the authorised newsagents
  6.2.2    The viability of the authorised newsagency
  6.2.3    Responses of the newspaper publishers
  6.2.4    Responses of magazine publishers and distributors
           6.3      Re-evaluation of net public benefit in 1998
  6.3.1    The relevant markets…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [1998] ACompT 3
Decision Date: 18 Nov 1998

CaseChat Overview and Summary

The Australian Competition Tribunal has reviewed the decisions of the Australian Competition and Consumer Commission to revoke authorisations for the distribution of newspapers and magazines in Victoria, New South Wales, the Australian Capital Territory and Queensland, and to grant substitute authorisations for the distribution systems until 1 February 2001. The authorisations were granted in 1980-85, under section 88 of the Trade Practices Act 1974, and regulated the distribution of newspapers and magazines through authorised newsagents, which were granted exclusive rights to distribute publications within defined territories. The authorisations were challenged by 7-Eleven Stores, the Independent Newsagents Association and the Australasian Association of Convenience Stores, who argued that the authorisations should be revoked and that the duration of the substitute authorisations should be shortened. The Tribunal concluded that the authorisations should be revoked, but that substitute authorisations should be granted until 1 July 1999, except for the distribution of magazines and the prohibition on publishers from supplying publications to outlets other than authorised newsagents, which should be revoked earlier, and for the home delivery of newspapers, which should be authorised until 1 February 2001. The Tribunal found that there had been material changes in circumstances since the authorisations were granted, including changes in the market, the strategies of publishers and newsagents, and the viability of authorised newsagents. The Tribunal also found that the substitute authorisations should provide for a period of transition to allow for adjustments to the system.

Orders