Today I am releasing the report of the Productivity Commission inquiry "Review of Section 2D of the Trade Practices Act 1974: Local Government Exemptions".
Section 2D of the Act exempts local government licensing decisions and internal transactions from Part IV (the competition provisions) of the Act. The exemption was reviewed in line with the Commonwealth's commitment under the Competition Principles Agreement to review all legislation that restricts competition to ensure that the legislation is of net benefit to community as a whole.
The Commission found that, on balance, Section 2D provides a net benefit to the community. However, the Commission also found that greater benefits would be obtained by directly limiting the application of Part IV to the business activities of local government, consistent with the original intention of the National Competition Policy reforms. The Commission has recommended that Section 2D be repealed and replaced with a section stating explicitly that Part IV of the TPA only applies to the business activities of local government.
The Government is releasing the report to facilitate consultation with the States and Territories on the report's recommendation. The Government will respond to the recommendation in due course.
Copies of the report are available from Government Info Shops, or may be downloaded
from the Productivity Commission's website at http://www.pc.gov.au