O'Connor SimonSIMON O'CONNOR (National—Tāmaki): I am sure there is no collusion going on with these short calls—some sort of agreement seems to have broken out. So in the interest of that I will attempt to do something different to show our independence. I do not want to run foul of this bill in its third reading.I am very pleased to speak to this Commerce (Cartels and Other Matters) Amendment Bill in its third reading. I have been very fortunate to sit on the Health Committee—which I seem to be relatively well-known for for a variety of reasons—but I have also had the pleasure of sitting on the Commerce Committee which provided a welcome contrast. I want to pick up on something the last member Ria Bond just noted: that actually the select committee has been incredibly cooperative in working through this bill.Part of it too has been working with different Ministers. As you would probably appreciate Mr Assistant Speaker—apologies Mr Assistant Speaker; I am not meant to bring you into the debate—there are differences in each Minister and that has actually I think contributed to a robustness in this piece of legislation. I want to acknowledge Minister Dean for the work that she has done to pick up the portfolio more recently than not and for bringing this bill which has been around for a while to a conclusion. So to Minister Jacqui Dean: thank you for your work and leadership in this regard. Before Minister Dean was Minister Goldsmith and before him was Minister Foss. As I said at the start each Minister brings a slightly different perspective. I think in a paradoxical way this has actually strengthened the whole process to enable us to get to where we are today. I am actually quite pleased that—you know we have been ribbed for want of a better word and in some ways continue to be across the House at the moment. This has been a long process but I think it is one that has been quite correctly followed. I think it is really good that today with a spot of luck and without pre-empting the vote we are going to bring it to a conclusion. It is no surprise that this bill sits in sort of a wider framework for the Government around matters of commerce and around consumer affairs. The select committee most recently has also gone through the patent attorneys bill—now an Act. There are slightly different elements but they are related—again it is about how we continue to have fair and proper competition. You hear from me and other members particularly of the Government about wanting to see a continually strengthening economy—that we are trade-focused and we are going to reduce the red tape. Well actually it is legislation like this that makes a difference. We had also had recently legislation around those—I think it was the piece of legislation around countervailing duties and dumping. Again these are all small—I was going to say small cogs but I do not think that is appropriate; they are actually significant cogs in a much wider machine. We have also had a bill introduced around financial services.Here we are talking about people potentially working in a cartel space. We are also looking at how we construct our commerce systems if you will to be—as I was talking about with the Minister earlier—centred around the borrower. In terms of this particular Act we are dealing well with cartels. Dr David Clark: Sort out section 36. SIMON O'CONNOR: I actually thought section 30 is probably the most interesting initially because it indicates what cartels are. I think that one of the things that is easy in debates is to get a bit lost in what the specifics are with the wider viewpoint. When we are talking about cartels—particularly for those who I am sure are riveted at home; perhaps including my father which is a worry—the cartel provisions are around primarily three areas. They are articulated in section 30A which for the member who just interjected—Dr David Clark: What are they?SIMON O'CONNOR: —is before section 36. They are price-fixing restricting output and market allocation. I think most of us when we think of cartels and why there is a piece of legislation being put forward will think of cartel behaviour primarily around the price-fixing. Having worked in the insurance area for a number of years it was always quite critical that we were not price-fixing and were never to be seen to be doing so as well. Without—I hope—crossing any boundaries you always made sure that you were effectively never in the same room with a competitor lest you be accused of somehow colluding and bringing things together. So in the first instance it is cartel activities around price fixing. The second is around restricting output. I think it is probably quite intuitive to most of us that you can affect the price by affecting supply. So if you have decided to buy whole container of widgets the public desires two containers of widgets and you decide to give out only half then you have involved yourself in restricting output there.Then there is the whole element around market allocation. So that is what we are talking about here. As has been noted this bill has been debated since about 2011. But as I think you can probably understand Mr Assistant Speaker and others there is a complexity in all of those three areas that needs to be well looked at. One of the things we do not want to do in trying to seek the good of stopping cartel behaviour is stop proper legitimate behaviours.In fact there are plenty of instances where businesses rightly work together where they actually rightly share information in order to work more cooperatively. One of them—and this bill looks at it—comes up around the maritime industry. I think for the first time we are beginning to regulate quite strongly on any cartel behaviour around maritime trade. But one of the things we want to be really careful of is not affecting—I would suggest probably the most critical one actually is trade into the Pacific. Having lived in the Islands for a few years you certainly appreciate there is almost a singular ship but multiple providers sending supplies to Fiji or New Caledonia or Samoa or the like. What this bill does is say: Look those shipping groups and agencies shouldn't be in cartel behaviour but we recognise that they also have to cooperate." Again it is just a small illustration of why legislation like this takes a little bit of time—a bit like this speech.Why these things take a little bit of time is that you absolutely have to get it right. So we definitely do not want cartel behaviour occurring in between our trade and in the maritime sector going into for example the Islands. But at the same time we want to make sure that legitimate business practices occur. Again to illustrate that—at the moment it is very normal with one ship going to the Islands that multiple ship users which is probably a very ineloquent way to put it but those who are sending their products north can actually talk and discuss work out their timetabling together and so forth. So that makes a lot of sense.The other area that has got a lot of traction here today has been around the whole reason why we have chosen not to criminalise cartel behaviour. I think there has been a lot of robust discussion around that and that has been very welcome. You would expect it in this House and you would expect of the Opposition in particular. As one who sat on the committee and listened to and talked to the various Ministers I say that when you have a system in the civil area that is working you keep it. I know it is a rather simplistic way to look at it but basically the civil regime is working at the moment for managing cartel systems.Hon Jacqui Dean: Big fines.SIMON O'CONNOR: Yes substantial fines actually.Hon Jacqui Dean: $6 million.SIMON O'CONNOR: The Minister says it is $6 million. So I think actually it puts a bit of context in there that OK if it is not in the criminal regime we are not talking about this simply being a light-handed slap on the wrist in the civil system. In fact when you are up into fines of $6 million you are talking something quite substantial.I think also—and look I am no lawyer—adding more things into the criminal code almost for the sake of it is not necessary nor appropriate. I think we do that carefully and cautiously. So I think fundamentally in this space we have achieved the right balance. As I said at the start it is working within the civil structure and so we need to keep it there at this point in time. I mean any Government present or future can always reserve the right to relook at that. In fact one thing I would be interested in post the enactment of the bill because it does not substantially affect it is whether or not there are regulatory powers to make those changes. I suspect anything like that would take some work through the usual legislative process.We have made a number of amendments within the bill. This is particularly to create the understandable exceptions that are required. I mentioned a little bit earlier about collaborative activities and tried to illustrate them somewhat in the maritime area. You have also got the whole vertical supply agreement side of things and that is effectively a manufacturer who sells directly online but is also selling to a retailer. A little bit you could imagine is someone who—Hon Jacqui Dean: Pro-competitive.SIMON O'CONNOR: Well it is pro-competitive but it is also trying to appreciate that we want to stop—as I probably keep repeating—cartel behaviour.Hon Jacqui Dean: That's right.SIMON O'CONNOR: Absolutely. But we need to recognise that there is a rightful complexity to how people conduct business these days. So if someone is again making again widgets we absolutely want them to be able to sell them to various retailers out in the market.Dr David Clark: What about section 36?SIMON O'CONNOR: But we also want to be able to have them sell them on say TradeMe and the like.I am conscious that I have only really got to section 30. I know my colleague across the House wants me to get to section 36. I do not think that in the 5 seconds left I can get through all the clauses but I commend this bill to the House."