QIW Ltd (applicant) & re application for review of a determination of the Trade Practices Commission dated 29 May 1995 to grant an authorization to Davids Ltd in relation to the proposed acquisition of Composite Buyers Ltd. [1995] ATPT 2

QIW Ltd (applicant) & re application for review of a determination of the Trade Practices Commission dated 29 May 1995 to grant an authorization to Davids Ltd in relation to the proposed acquisition of Composite Buyers Ltd. [1995] ATPT 2

The Tribunal held that while the acquisition would reduce the number of independent wholesalers in relevant State sub-markets, the detriment to competition was outweighed by clear and significant public benefits—particularly the ability to improve the competitiveness, efficiency and viability of the independent sector as a 'fourth force' against the national chains. The Tribunal determined that the net public benefits were real and sufficient, and conditions and undertakings accepted by Davids further safeguarded the public interest. Accordingly, authorisation under section 88(9) should be granted, subject to specified conditions.

Parties
Applicant: QIW Limited; Authorisation Applicant / Respondent: Davids Limited; Decision Maker / Respondent: Trade Practices Commission
Jurisdiction
Australia
Judgment Date
17 October 1995
Procedural Posture
Review of Administrative Decision (authorisation) / Final Decision / Reasons for Decision
Outcome
Authorisation granted, subject to conditions and undertakings as specified.
Legal Topics
Authorisation of Merger/acquisition, Substantial Lessening of Competition, Public Benefit Vs Detriment, Market Definition, Grocery Distribution Industry, Section 88(9) and 90(9) Trade Practices Act, Barriers to Entry, Banner Group Discipline
Competition Law Administrative Law Authorisation of Merger/acquisition Substantial Lessening of Competition Public Benefit Vs Detriment Market Definition Grocery Distribution Industry Section 88(9) and 90(9) Trade Practices Act +2 more

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Parties

QIW Limited

Applicant

Davids Limited

Authorisation Applicant / Respondent

Trade Practices Commission

Decision Maker / Respondent

Procedural Posture

Review of Administrative Decision (authorisation) / Final Decision / Reasons for Decision

Legal Issues

  1. 1 Whether authorisation should be granted to Davids Limited to acquire all issued shares and securities in Composite Buyers Limited (CBL) pursuant to section 88(9) Trade Practices Act 1974
  2. 2 Whether the acquisition would have or be likely to have the effect of substantially lessening competition in a relevant market contrary to section 50
  3. 3 Whether the proposed acquisition would result, or be likely to result, in such a benefit to the public that it should be allowed despite any detriment, including anti-competitive effects

Ratio Decidendi

The Tribunal held that while the acquisition would reduce the number of independent wholesalers in relevant State sub-markets, the detriment to competition was outweighed by clear and significant public benefits—particularly the ability to improve the competitiveness, efficiency and viability of the independent sector as a 'fourth force' against the national chains. The Tribunal determined that the net public benefits were real and sufficient, and conditions and undertakings accepted by Davids further safeguarded the public interest. Accordingly, authorisation under section 88(9) should be granted, subject to specified conditions.

Court Disposition

Authorisation granted, subject to conditions and undertakings as specified.

Orders

  • Davids authorised to acquire all issued shares and other securities in CBL other than those to which it has present entitlement, but not fewer than the number required enabling it to cast more than 50% of votes at CBL general meetings, subject to conditions.
  • Davids to comply with undertakings provided to the Commission under s. 87B Trade Practices Act.