McClay ToddHon TODD McCLAY (National—Rotorua): Well we all look forward to constructive debate. That's why the Parliament was created. It's less easy to do so when Minister your officials have got it so wrong in some areas.National supports good competition law. In fact if I think back to the nine years we were in Government there were times where there were very sensible changes we wanted to bring forward but the then Labour Opposition didn't support them. I don't know whether that was because ideologically they were opposed or they were just in Opposition mode. But in this instance the Supplementary Order Papers (SOPs) that I've brought forward are not because we oppose everything the Government is doing. In fact there is some good in this legislation. It will help those who are in a less strong position against dominant players in a market. But Minister they are minor tweaks that we are seeking through our SOPs which would bring this as close to perfect the legislation as is probably possible when it comes to competition law.I would say however I am very pleased that the Minister is able to be here for this so we can have—actually it will be a constructive conversation on this. The more we talk about these things the greater the understanding amongst the businesses the lawyers and others who deal with competition issues on a daily basis and the greater the likelihood they get it right if they follow what Parliament's intent is. But if I cast my mind back to last week it might have been when we were in the House and we were considering the Incorporated Societies Bill and unfortunately Minister Little was here and that was anything but constructive—and occasionally less than the intelligence that this place deserves. So I'm pleased the Minister is able to be here because it has been a good process so far on this legislation.When it comes to a dominant position in the way a company acts that is important. They shouldn't be able to use their position to further the economic gains or to strengthen their position even further and harm those who are wanting to compete against them. There were some who submitted—I asked the committee this and in fact I think when the Minister came before us I asked him separately about his view of Air New Zealand and whether they use a dominant position because they are dominant. They are virtually the only airline here that is servicing all of the airports bar a few that New Zealand aeroplanes can fly to.Where there is competition prices somehow seem to be less as you fly around provincial or regional New Zealand. Where there isn't competition some have argued that as soon as the competition disappears the pricing structure changes. The point of this is not to beat up on Air New Zealand; they provide a very important service. It's to make the point that if the Minister won't actually say Yes we think there's a problem with Air New Zealand." he is accepting the position that National has taken that New Zealand is a smaller market than Australia and smaller than most other countries and so a perfect competition framework may not work in the best interests of the consumer.And so the Minister desiring to make sure that actually a dominant player doesn't harm a market if we take that too far actually it will alter the behaviour of that business which could also harm the consumer with or without competition.In effect the first SOP—I have three in Part 1; I will take time to address each of them—is around the consequences of action where there is strong market power. The Minister has changed it to say where a company has the intent the effect or likely effect to be anti-competitive then actually they're not allowed to do that. He has said that the Commerce Commission will look at this very very carefully and create guidelines.But actually for a business when it's taking a position and it's a dominant player if its intent is to act anti-competitive that should be against the law; currently it is. If the likely effect of their decision—the likely effect of their decision—the foreseeable consequence of their decision is that it's anti-competitive that too should be against the law.But if the effect is anti-competitive and it couldn't be foreseen why are we penalising them? Because although the Commerce Commission say "Well you just have to change this." in New Zealand there is always a consequence which is "Well it's not really your fault. I suppose you didn't understand"—Air New Zealand or any other large player—"and just nobody has noticed." Those who feel that they are badly treated will want compensation or they will want some sort of punitive restriction or a fine. So therefore if you cannot foresee an effect a likely effect then actually how is it we're holding them to account? So I'm not arguing that if an effect is that something is not competitive it shouldn't be considered but actually the legislation holds them to a higher standard than I think is reasonable.So my SOP says that actually where there is likely effect or intent yes it should fit within the scope of this legislation but when there is an actual effect but it couldn't be foreseen and there wasn't the consideration wasn't a likely effect it shouldn't be within the scope of the legislation. This isn't to create a carve-out because the Commerce Commission will take their responsibilities purposefully and seriously and I would hope they would be reasonable in this. But pressure is always there to bear particularly on larger companies.I have other interventions on this; I won't just use up the full four minutes remaining of my second intervention on this because I'd like to hear from the Minister but I'd like to explore why he believes where a business cannot foresee that their actions will have an impact upon competition that they should be held to account and they should be penalised because they are likely to be firstly. Secondly he has an opportunity to share a view of Air New Zealand because they are a dominant player and there are situations where complaints are made. And actually if there is competition and Air New Zealand decide to put on extra flights by pulling them from somewhere else into a market to compete fairly that could be seen as anti-competitive. But in the case that they can't foresee that—sorry—and therefore it is just the effect will Air New Zealand be held to account? Because actually we're all for better service in New Zealand and much much cheaper airfares to regional New Zealand but actually we also want aeroplanes flying in there and so I'm sure Air New Zealand is as interested in the answer to the Minister's questions on this as the committee is."