Issues F to K: Restrictive Trade Practices
Background
75. Part 2 aims to prohibit the full range of anticompetitive conduct. The prohibitions are described in two ways: principles and rules. The principles (or "rule of reason prohibitions") require an assessment of the impact on competition case-by-case. The per se rules prohibit the conduct outright.
76. The rule of reason provisions prohibit:
- Agreements that have the purpose or effect of substantially lessening competition (sections 27 and 28);
- Certain types of exclusionary provisions that substantially lessen competition (section 29); and
- Individual firms from using a substantial degree of market power for anticompetitive purposes (sections 36 and 36A).
77. The per se rules prohibit price fixing (section 30) and resale price maintenance or RPM (sections 37 and 38).25
78. Section 58 empowers the Commission to authorise conduct that may fall afoul of these prohibitions, other than sections 36 and 36A.26 The Commission may grant an authorisation on public benefit grounds.27 An authorisation allows the firm or firms to enter into and/or give effect to the conduct without the risk of legal challenge by the Commission or a private party.
79. The purpose of the restrictive trade practice authorisation process is the same as for merger authorisations: to permit conduct that is good for New Zealand society even though it may contravene the substantive prohibitions.
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