Friday, May 6, 2011
The Competition and Consumer Amendment Bill (No. 1) 2011 (Exposure Draft): A Problematic Attempt to Prohibit Information Disclosure
Posted by D. Daniel Sokol
Brent Fisse, University of Sydney - Faculty of Law and Caron Y. Beaton Wells, Melbourne Law School have posted The Competition and Consumer Amendment Bill (No. 1) 2011 (Exposure Draft): A Problematic Attempt to Prohibit Information Disclosure.
ABSTRACT: The Competition and Consumer Amendment Bill (No. 1) 2011 (Exposure Draft) seeks to prohibit anti-competitive disclosure of information by one competitor to another. The proposed prohibition under s 44ZZW seeks to ban the private disclosure of price-related information. The proposed prohibition under s 44ZZX seeks to ban the public or private disclosure of price-related and certain other information for the purpose of substantially lessening competition in a market. Neither prohibition has a cogent rationale. As a result, both suffer from dire overreach and are likely to produce unintended consequences. The most fundamental flaw is that the proposed prohibitions focus on information disclosure whereas the relevant economic concern is not information disclosure of itself but the facilitation of coordinated conduct by competitors. Another serious flaw is that the proposed exceptions to the prohibitions are too limited in scope. There is also a potential loophole, namely the conceivable use of continuous disclosure by public-listed companies as an avenue for getting around the prohibition against public disclosure of information under s 44ZZX.