Refusals to Supply Under Section 46 of the Trade Practices Act: Misuse of Market Power or Legitimate Business Conduct?

Abstract

extract] As this article demonstrates, a refusal to supply will be excused by the courts provided there is some legitimate business explanation for it. Of necessity, this approach requires a case-by-case examination of the relevant factual matrix, but within the parameters established by judicial pronouncement. This article contends, therefore, that critics who assert the lack of 'any coherent framework' for the application of s 46 in refusal to supply cases have overlooked the significance of legitimate business reasons offered (or omitted) by the defendant corporation in justification of its conduct. To provide context for this discussion, the article first reflects on the internationally-recognised importance of proscribing misuses of market power. It then re-examines the elements of s 46 of the Trade Practices Act in terms of the seminal principles articulated by the High Court in Queensland Wire (where, it should be emphasised, BHP failed to provide a legitimate business reason for its behaviour) and applied by the Federal Court in subsequent decisions.