Interpretation and application of the purpose test in s 46 of the Competition and Consumer Act 2010

Shirley Quo
Part 1 - (2011) 19 Competition and Consumer Law Journal 90
Part 2 - (2012) 19 Competition and Consumer Law Journal 215

Abstract

Characterising a firm’s behaviour as pro or anticompetitive is one of the most difficult tasks a court can face in Section 46 cases. Given the inherent ambiguity of much such behaviour it would seem foolish for judges to deny themselves the assistance to be drawn from objective manifestations of a party’s underlying intent. To demonstrate why this is so, the author explores the conflicting judicial viewpoints on the role of 'purpose' under section 46 and argues that objective evidence of purpose should be given priority over subjective evidence of intent in assessing the true nature of the conduct under scrutiny. Where both exist however, both can be fairly placed in the balance. Looked at in this way evidence of intent or purpose is a sensible first step in characterising the conduct alleged to be unlawful. The author sets her analysis firmly in the context of the ongoing predatory pricing/ recoupment debate and offers it as an alternative to the counterfactual approach when judges are faced with conflicting economic theories on this highly contentious subject.

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