Competition Policy Reform Act 1995

The Act has broad reach. Corporations carrying on business in Australia remain the primary subjects of Part IV prohibitions (ss 45–50 as amended). However, new ss 2B and 2C extend Part IV to the Crown in right of each State, Territory and the Commonwealth “so far as the Crown carries on a business”. Local government bodies are exempted only for licensing and intra-body transactions (new s 2D).

Infrastructure owners and operators are directly affected by Part IIIA. Providers of services supplied by means of a facility of national significance (roads, railways, pipelines, ports, telecommunications, electricity transmission) may face declaration, arbitration and compulsory access determinations (ss 44B, 44H, 44V). Third parties seeking access gain statutory rights to negotiate and arbitrate (s 44S).

State and Territory governments are affected both as potential providers of declared services and as participants in the Competition Principles Agreement and Conduct Code Agreement. The “effective access regime” test (ss 44G(3), 44N) requires regimes to conform to the Agreement’s principles; failure can lead to federal declaration overriding state arrangements. The Minister may gazette a jurisdiction that has modified the Competition Code excessively, removing its participating status (s 150K).

Commonwealth authorities exercising regulatory or purchasing functions are subject to the Act except when acting in a non-commercial capacity (new s 2C). The ACCC and National Competition Council themselves are given expanded roles, with the former assuming Prices Surveillance Authority functions (Schedule 3 amendments) and the latter performing gatekeeper and advisory roles.

Consumers benefit indirectly through the new statutory object in s 2 of the Principal Act: “to enhance the welfare of Australians through the promotion of competition and fair trading and provision for consumer protection”. Authorisation and notification processes (amended ss 88, 93) continue to allow public benefit weighing.

Legal practitioners, consultants and expert witnesses before the Tribunal or in arbitrations are given explicit protections and roles (new ss 43A, 43B, 44ZE, 44ZH).

Duties

• Providers of declared services must not hinder access (s 44ZZ).
• Parties to access arbitrations must pay their share of costs (s 44ZN) and comply with Commission directions on procedure, evidence and confidentiality (ss 44ZF–44ZL).
• The Commission must afford conferences before issuing s 93 notices (amended s 93A) and publish registers of determinations, undertakings and decisions (ss 44Q, 44ZZC, 44ZZL).
• The Council must apply Competition Principles Agreement criteria when assessing effective access regimes and must not consider extraneous matters (s 44G(3)).
• Ministers must publish reasons for declaration and revocation decisions (s 44H(7), s 44J(5)).
• Bodies corporate must ensure directors, servants and agents do not contravene the Act; attribution rules in new s 44ZZO mirror s 84 of the Principal Act.

Rights

• Third parties have a statutory right to notify access disputes and obtain arbitrated terms (s 44S, s 44V).
• Providers may seek Tribunal review of declarations (s 44K) and variations of determinations (s 44ZU).
• Parties retain the right to negotiate commercial access contracts and have them registered, giving them the same enforceability as determinations (s 44ZY).
• Applicants for authorisation or notification gain immunity while processes are on foot or in force (amended ss 88(8A), 93(7A)–(7C)).
• Jurisdictions party to the Agreements obtain procedural protections before Council recommendations or Ministerial overrides (ss 44M–44P).
• The Tribunal may set aside Commission notices under s 93(3A) if public benefit outweighs detriment (new s 102(5A)).

The new object clause (s 2) provides an overarching interpretative right that courts must now consider when construing any provision.

The 1995 Act does not itself create new penalty levels but integrates with the existing enforcement regime of the Principal Act. Contraventions of Part IV (including the extended application to government business) remain subject to pecuniary penalties recoverable by the Commission or any other person (amended s 77). Injunctions are available on application by the Commission, the Minister (with limitations in Part IV matters) or affected parties (amended s 80). Divestiture remains available for s 50 breaches (amended s 81).

Part IIIA contraventions attract specific remedies. Determinations are enforceable by Federal Court order, including compensation and injunctions (s 44ZZD). Hindering access under s 44ZZ is enforceable by any person, with the Court able to grant restraining or mandatory injunctions, compensation, and other orders (s 44ZZE). Factors relevant to discretion are codified (ss 44ZZH, 44ZZI). Access undertakings are enforceable by the Commission (s 44ZZJ).

Contempt-type offences during arbitrations carry up to six months’ imprisonment (ss 44ZG(2), 44ZI, 44ZJ). Intimidation of witnesses carries 12 months (s 44ZK). Protection of Part IV information obtained under s 155 is reinforced by new s 155AA, creating a statutory non-disclosure obligation for Commission officials.

Transitional provisions delay pecuniary penalty exposure for state and territory authorities for 12 months after the fourth commencement time (s 88).

The Act is expressly designed for concurrent operation. New s 51AAA states Parliament’s intention that State or Territory laws can operate concurrently with Part IV unless directly inconsistent. Part XIA facilitates application of the Competition Code by participating jurisdictions without displacing the federal Act (s 150G). No “doubling-up” of penalties or liabilities is permitted (s 150H).

The access regime interacts with existing industry-specific regimes. An “effective access regime” approved by the Commonwealth Minister displaces the federal declaration power (ss 44G(5), 44N). Conversely, the Council and Minister must apply Competition Principles Agreement criteria and cannot consider other matters. Part IIIA does not apply to the supply of goods, intellectual property or production processes except as an integral subsidiary part (s 44B definition of “service”).

Constitutional limits are explicit. Division 3 of Part IIIA operates only where the provider or third party is a corporation or the access is in constitutional trade or commerce (s 44R). Similar limits apply to registered contracts (s 44ZV).

The Act amends the Prices Surveillance Act 1983, transferring its functions to the ACCC (Schedule 3) and inserting gender-neutral language. Consequential amendments appear in the Australian Postal Corporation Act 1989, Broadcasting Services Act 1992, Telecommunications Act 1991, Moomba-Sydney Pipeline System Sale Act 1994 and numerous other statutes (Schedules 2 and 3).

Cross-vesting and Federal Court jurisdiction are preserved (s 150E). The Act binds the Crown but does not render the Crown liable to pecuniary penalty or prosecution, though authorities lose that immunity (new ss 2A(3), 2B(2), 44E).

Although the query concerns the 1995 Act itself, its provisions have been amended many times, most notably by the Trade Practices Amendment (Australian Energy Market) Act 2004, the Competition and Consumer Act 2010 (which renamed the Principal Act), and the Competition and Consumer Amendment (Competition Policy Review) Act 2017. The 2017 amendments strengthened the s 46 misuse of market power prohibition by removing the “take advantage” limb and introducing an effects test, inserted a new s 46(1AA) prohibition on concerted practices, and amended the access regime to require the Commission to consider “any other matters” beyond the mandatory list in s 44X.

These changes reflect ongoing policy concern that the original 1995 balance between certainty for infrastructure owners and promotion of competition in dependent markets had tilted too far toward owners. The 1995 Act’s emphasis on “uneconomical to develop another facility” (ss 44G(2)(b), 44H(4)(b)) and national significance has been retained but is now read against a broader public interest lens. The National Competition Council’s role in certifying state access regimes has been refined to reduce regulatory overlap.

The original staged commencement and transitional provisions were necessary because the 1995 Act represented a seismic shift; jurisdictions needed time to enact application laws and align their own access regimes.

The leading case on the access regime remains Re Sydney International Airport [2000] ACompT 1, in which the Tribunal emphasised that “promote competition” in s 44H(4)(a) requires a material increase in competition in a dependent market, not merely a theoretical possibility. The “uneconomical to develop” test has generated litigation focusing on whether duplication is economically feasible for a hypothetical efficient new entrant rather than the actual provider (Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2012) 246 CLR 379).

Constitutional challenges to the extension of Part IV to government business were largely settled by NT Power Generation Pty Ltd v Power and Water Authority (2004) 219 CLR 90, which confirmed that trading activities of government authorities attract the Act. The High Court upheld the validity of the access regime in NSW v Commonwealth (2006) 229 CLR 1 (the WorkChoices case) by reference to the corporations power, though the 1995 Act itself relied on a combination of powers.

Controversies have centred on the tension between investment incentives and access. Infrastructure owners argue that arbitrated terms can amount to regulatory taking (compensation is addressed in s 44ZZN). Access seekers complain of delay and cost; the multi-layered review (Council → Minister → Tribunal → Federal Court on law) has been criticised as cumbersome. The Productivity Commission’s 2013 review and the Harper Review (2015) both recommended streamlining, leading to the 2017 amendments.

The Competition Code’s uniformity has been imperfect; Western Australia initially stood outside aspects of the scheme, triggering s 150K gazettal debates. The cumulative list of authorised laws required in the Commission’s annual report (amended s 171(2)) has become a significant transparency tool but also a source of ongoing federal-state negotiation.

Most practitioners miss that the “effective access regime” test is not a merits review but a strict application of Competition Principles Agreement criteria; the Council and Minister are statutorily prohibited from considering other matters (ss 44G(3), 44N(2)). A state regime certified years ago can lose its shield if the Agreement principles are later amended or if substantial modifications occur.

The transitional contract protection in ss 34 and 89 looks simple but contains a trap: variation after 19 August 1994 exposes the varied contract to the new law even if the original did not. Courts have read “variation” broadly.

Section 44W(1)(a) prevents determinations that would prevent an existing user obtaining its “reasonably anticipated requirements measured at the time the dispute was notified”. The temporal lock-in is often overlooked; later growth in the user’s demand does not automatically expand its protected volume.

The new s 155AA creates a separate confidentiality regime for Part IV information obtained under s 155. It is not subject to FOI in the same way and overrides general Commission disclosure powers. Commission officials have been disciplined for inadvertent breach.

Finally, the statutory object in s 2 is not mere preamble. In Australian Competition and Consumer Commission v Cement Australia Pty Ltd (2017) 258 FCR 1 the Full Court treated it as a mandatory relevant consideration when weighing public benefit in authorisation contexts. Any advice that ignores the object is incomplete.

Infrastructure owners should maintain a watching brief on declaration applications and, where appropriate, demonstrate to the Council that an existing contractual or regulatory access regime satisfies the six statutory criteria. Robust records of efficient costs, capacity forecasts and investment plans are essential for arbitration under s 44X.

Businesses seeking access should first attempt commercial negotiation; notification under s 44S should be supported by evidence of genuine attempts to agree and a clear articulation of how access will promote competition in a dependent market. Confidentiality claims under s 44ZL must be particularised early.

Government businesses must segregate commercial and non-commercial activities (s 2C) and ensure that licensing and procurement decisions do not inadvertently breach Part IV. State and Territory governments should align their access regimes with the Competition Principles Agreement before the Council is asked to certify them; retrospective certification is difficult.

All parties should keep the cumulative list of s 51 authorisations published in the Commission’s annual report. Any proposed regulatory immunity must expressly refer to the Act or Code and be limited to two years for regulations.

Compliance programs should expressly address the extended attribution rules in s 44ZZO and the prohibition on hindering access. Training for directors and senior managers on the purpose element in s 44ZZ(2) (which can be proved by inference) is critical.

Finally, because the access regime interacts with industry-specific legislation, compliance requires integrated advice across competition, sector regulation and constitutional law. Annual audits of infrastructure contracts against the registered-contract and undertaking provisions (Divisions 4 and 6 of Part IIIA) are prudent.