The Politically Incorrect Show - 21/09/2001
[Music - Die Fledermaus]
Good afternoon, Kaya Oraaaa & welcome to the Politically Incorrect Show for Friday September 21, proudly sponsored by Neanderton Nicotine Ltd, the show that says bugger the politicians & bureaucrats & all the other bossyboot busybodies who try to run our lives with our money; that stands tall for free enterprise, achievement, profit & excellence against the state-worshippers in our midst; that stands above all for the most sacred thing in the universe, the liberty of the human individual.
[Music up, music down!]
An object lesson in the folly & immorality of government restrictions on economic freedom reached culmination point in the New Zealand parliament today.
Earlier this year, the government toughened criteria under which the (anti-) Commerce Commission would approve business mergers & takeovers. Previously, applications would be denied if approval was deemed likely to give the applicants "market dominance"; the new rules meant that applications would be denied if approval was deemed likely to "reduce competition." Problem: What would be the status of applications lodged under the OLD rules but considered AFTER the NEW rules had taken effect? Which rules should be used in such cases? The government's intention had been that such applications would be considered under the OLD rules. The Commerce Commission proceeded accordingly. A case in point was Progressive Enterprises' acquisition of Woolworths, sought under the old rules, adjudicated upon & approved by the Commerce Commission under those rules even though the new ones were already in effect.
Yesterday, to cut a long story short, the Court of Appeal decreed that, as a matter of law, all such applications should be considered under the NEW rules, thus casting doubt over the legal legitimacy of the Progressive/Woolworths deal & any others like it - & incidentally, placing the Commerce Commission in the farcical position of possibly having to prosecute companies for having proceeded with mergers to which it had given its blessing!
The government scrambled to rectify the problem this afternoon, taking urgency to introduce a new Bill that will in effect overturn the Appeal Court decision. Presumably, Progressive Enterprises can breathe easy again (while opponents of arbitrary, unilateral, judiciary-over-ruling executive powers may continue to experience breathing difficulties!).
The real issue, of course, is that none of these rules, new or old, should exist at all. Businesses should be free to compete or collude, to acquire, merge, divest, etc., as they see fit, provided no force or fraud is involved. If someone attains "market dominance" or takes out his competitors in the process, so be it. What sort of competition is it where winning - or even gaining an advantage - is prohibited? (Apart from anything else, In a true free market, no "winner" can rest on his laurels for long.) There should be no Commerce Act & no Commerce Commission. Business is business, government is government ... & ne'er the twain should meet.
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