Case: Australian Gas Light Company (ACN 052 167 405) v Australian Competition &amp; Consumer Commission (No 3) [2003] FCA 1525
Outcome: cited
However, with respect there is little material presented before me upon which I can find that the respondent does have a substantial degree of market power in the Retail Market. In particular, I note the following: &#8226; In the Joint Expert Statement of Areas of Agreement and Disagreement, the expert witnesses for both parties agreed that, because of the respondent's substantial degree of market power in the Wholesale Market, "it is able to substantially influence patterns of competition in the Retail Market". The respondent points out however, that the experts do not say that the respondent has a "substantial degree of market power" in the Retail Market. This is in contrast with their agreement as the respondent's substantial degree of power in the Wholesale Market. Indeed Mr Williams gave evidence at the hearing that he was not an expert in the Retail Market (TS p 88 ll 40-42) and that he had not put his mind to whether the applicant had a substantial degree of power in the Retail Market (TS p 78 ll 3-4). &#8226; Conduct in a wholesale market which in turn affects levels of competition in a "downstream" retail market is a relatively common phenomenon, and issues relevant to this phenomenon have been considered in this court, for example, in the context of claims of alleged anti-competitive conduct in Pt XIB TPA ( Telstra Corporation Limited v Australian Competition and Consumer Commission (No 2) [2007] FCA 493) , in relation to claims for access to services under Pt IIIA TPA ( Sydney Airport Corporation Limited v Australian Competition Tribunal [2006] FCAFC 146) , and in the context of acquisitions claimed to result in a substantial lessening of competition ( Australian Gas Light Company (ACN 052 167 405) v Australian Competition &amp; Consumer Commission (No 3) [2003] FCA 1525). However, the ability of an entity to "substantially influence patterns of competition" in a retail market because of its market power in a wholesale market, as agreed by the experts, is not, in my view, necessarily tantamount to "a substantial degree of market power" in the Retail Market or even, as submitted by the respondent, "market power" within the meaning of the s 46 TPA. &#8226; As I have already noted, the activities of the applicant and the respondent in the Retail Market are quite different, supplying different services to different customers. It is not in contention before me that there is "a" Retail Market in which both the applicant and the respondent are supplying information. However, whereas it is clear that the respondent supplies base data to members of the general public who pay the prescribed statutory fee and makes available its SmartMap product, it is also clear that the applicant offers a much greater range of sophisticated products to a different customer base, namely parties who are prepared to subscribe to the applicant's services, as distinct from any members of the public who seek information over the counter. It is also apparent from the evidence before me that the applicant does not view the respondent as a significant competitor in its area of the Retail Market (RP Data Information Memorandum Document 1 pp 14, 15; evidence of Mr Catelan TS p 57 ll 37-42). In this respect, the "market power" of the respondent in the Retail Market, viewed in light of its activities in this broad Retail Market, is not obvious. Even if the respondent had market power in its area of the Retail Market in respect of its supply of raw data to end-users, it has not been demonstrated that such market power extends throughout the entire Retail Market as was the subject of consideration by the Full Court in Singapore Airlines Limited v Tabropane Tours WA Pty Ltd (1991) 33 FCR 158. &#8226; I note the submission of Mr Hinson SC for the respondent that the evidence fell short of establishing that the respondent had any market power let along any substantial degree of market power in the Retail Market. Further, I note that, notwithstanding para 7 of the amended statement of claim, Mr Hinson SC also submitted and this was not contested by Mr Jackson QC at the hearing that the respondent did not understand the applicant's case to assert that the respondent had a substantial degree of power in the Retail Market (note TS p 370 ll 12-17). &#8226; I also note that: o despite a number of oral submissions in his opening statement (TS p 2 ll 1-14, p 7 ll 19-23), Mr Jackson QC for the applicant did not subsequently press the claim that the respondent had a substantial degree of power in the Retail Market o Mr Jackson QC, in his written submissions concerning the issue of power in the Retail Market, confines the position of the applicant to the agreed position of the experts, and does not specifically submit that the respondent has a substantial degree of power in the Retail Market. &#8226; I have carefully reviewed the transcript and after submissions in the opening statement, I can identify no subsequent submissions made on behalf of the applicant that the respondent had a substantial degree of power in the Retail Market. &#8226; As pointed out in Queensland Wire , the existence of market power is identifiable by reference to factors including pricing, barriers to entry, market share. However in this case I note, for example, that: a. no evidence is lead as to the impact on prices in the Retail Market of conduct of the respondent b. although the entry of retailers into the market appears dependent upon their ability to obtain a licence from the respondent, there is no evidence before me as the extent to which this is a barrier to market entry by retailers c. no evidence is lead as to market share (if any) in the Retail Market held by the respondent.