EXPLANATORY STATEMENT
Statutory Rules of 1988 No. 203
Issued by the Authority of the Attorney-General
Trade Practices (Telecommunications Exemptions) Regulations (Amendment)
Subsection 172(1) of the Trade Practices Act 1974 (the Act) provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing all matters that are required or permitted by the Act to be prescribed, or are necessary or convenient to be prescribed.
Paragraph 172(2)(c) of the Act provides that the regulations may exempt from provisions of the Act conduct engaged in in the course of a business carried on by the Commonwealth or a Commonwealth authority.
Section 46 prohibits the misuse of market power for a predatory purpose specified in subsection 46(1). Section 47 prohibits the practice of “exclusive dealing”, which includes supplying goods on condition that the acquirer obtains goods from another person.
The Trade Practices (Telecommunications Exemptions) Regulations (the Principal Regulations) exempt a range of activities engaged in by the Government’s telecommunications authorities - Australian Telecommunications Commission (Telecom), Overseas Telecommunications Commission and Aussat Pty Ltd - from the operation of sections 46 and 47 of the Act.
Regulation 5 of the Principal Regulations exempts from sections 46 and 47 of the Act, until 30 June 1989, Telecom’s requirement that any subscriber acquiring a telephone service shall have connected to that service a “standard” telephone supplied by Telecom. The effect of the exemption is to enable Telecom to impose this requirement without contravening the Act. Regulation 2 amends the expiry date for that exemption to 30 June 1991. The earlier date was a drafting error.
Subsection 45(2) prohibits the making of, or giving effect to, agreements establishing primary boycotts involving competition (for example, collective refusals by competitors to deal with another party) or substantially lessening competition. The effect of subsection 45(6) is that conduct that would, but for that subsection, constitute a contravention of sections 45 and section 47 shall not constitute a contravention of subsection 45(2).
The Principal Regulations do not expressly provide that the relevant conduct exempted from the operation of section 47 should also be exempt from subsection 45(2).
On one view of the effect of the Principal Regulations, the exemption of the relevant conduct from the operation of section 47 may have had the unintended effect of removing the protection from subsection 45(2) for which provision is made in subsection 45(6). In order to clarify the matter, regulations 3 and 4 expressly provide that relevant conduct exempted from the operation of section 47 by the Principal Regulations does not contravene subsection 45(2) of the Act.