Case: Dowling v Dalgety Australia Ltd (1992) 34 FCR 109
Outcome: cited
The notion of "market power" in the sense of capacity to act in a manner unconstrained by the conduct of competitors has been the subject of frequent judicial consideration. The leading case in this context is Queensland Wire [1989] HCA 6 ; 167 CLR 177. Usefully, Lockhart J in Dowling v Dalgety Australia Ltd (1992) 34 FCR 109 at 138 summarised from the judgment of Mason CJ and Wilson J in Queensland Wire 167 CLR at 188-190 the following factors as relevant in defining and identifying market power: "(a) "the ability of a firm to raise prices above the supply cost without rivals taking away customers in due time, supply cost being the minimum cost an efficient firm would incur in producing the product"; (b) "the extent to which the conduct of [any of the respondents] in that market is constrained by the conduct of...competitors or potential competitors..." (s 46(3)); (c) market share of each respondent must be examined but this alone is generally not determinative of market power as "the relative effect of percentage command of a market varies with the setting in which that factor is placed" (Mason CJ and Wilson J adopted the language of Reed J in United States v Columbia Steel Co (1948) 334 US 495 at 528); (d) the presence of vertical integration is another factor, but its presence does not necessarily mean that a substantial degree of power exists; and (e) to what extent is it rational or possible for new entrants to enter the relevant market? That is to say, what are the barriers to entry? It is this factor which must be taken as the primary consideration in determining market power. See also the judgment of the Full Court of this court in Arnotts Ltd v Trade Practices Commission at FCR 336 9." 126 The respondent relied on comments of Lockhart J in Dowling v Dalgety 34 FCR at 143 where his Honour said that "purpose" in s 46 "is not concerned directly with the effect of conduct, but with the purpose in the sense of motivation and reason, though, as mentioned earlier, purpose may be inferred from conduct". 127 The applicant in para 10 of the amended statement of claim alleges that the respondent has so acted for the following purposes: "(a) for the purpose of eliminating or substantially damaging RP Data in the Market or the Retail Market (b) for the purpose of deterring or preventing RP Data from engaging in competitive conduct in the Market or the Retail Market Particulars (i) The fact that the Department has this purpose is to be inferred from: (A) the effect of the proposal as set out in paragraphs 8 and 9 hereof (B) the Department, through Colin Witt, has evinced an intention to harm and prevent RP Data competing in the market place by: (I) offering Infopac favourable terms in order to compete with RP Data (II) informing John Edwards of Residex that the Department had an intention to reduce the cost of the Collected Data so as to break RP Data's monopoly (C) Wayne Fry and Geoff Oakley on 4 February 2005 stating to Jane Woodward of RP Data that if RP Data did not agree to the new licence conditions that they would not receive any Collected Data in the future. (ii) The purpose is that of the persons set out in paragraph 8 above (iii) The competitive conduct of RP Data which it is the Department's purpose to deter or prevent RP Data from engaging in is the provision electronically of the Collected Data including the Excluded Data: (A) in competition with the Department (B) in competition with other licensees (ba) for the purpose of deterring or preventing real estate agents from direct marketing to owners of real property using the Excluded Data (bb) for the purpose of deterring or preventing real estate agents thereby from engaging in competitive conduct in the Real Estate Agents' Services Markets." 128 The respondent in its amended defence denied that it has acted in the manner alleged by the applicant, and states in para 42 that its purpose in proposing to exclude the Excluded Data from the Collected Data available under future licences is to ensure that such information in bulk data form is not available for direct marketing purposes.