CUTS International &
Vietnam Competition Administration
Department (VCAD), Ministry of Trade,
Vietnam Present: TRAINING WORKSHOP On
M&AS EVALUATION SKILLS FOR
COMPETITION AUTHORITY
OFFICIALS
Sitesh Bhojani, Barrister & Consultant
(former ACCC Commissioner)
CatBa Island, Vietnam – 13 & 14 August 2005
Sitesh Bhojani, Barrister & Consultant
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Presentation Summary

The context – elements of Australian merger
contravention

what type of evidence will be needed in investigating a
merger case that is likely to cause competitive concerns;

the sources/where to get the necessary evidence;

the skills required/tips to acquire such evidence;

the tips to test the accuracy of the evidence;
how to organise the evidence in a suitable manner for use
in litigation if required, etc.
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Sitesh Bhojani, Barrister & Consultant

The Context – Elements of an
Australian Merger Contravention
A Corporation;
 shall not directly or indirectly
acquire shares;
 In the capital of a body
corporate;
If –
 the acquisition would have the
effect;
 or be likely to have the effect;
 of substantially lessening
competition in a market

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Types of Evidence
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Types of Evidence continued…
4.
MARKET PLACE EVIDENCE
Real Evidence
Documentary Evidence
Witnesses – market participants as to
actual behaviour or perception
Survey Evidence

EXPERT ECONOMIC EVIDENCE

1.
2.
3.
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Case Examples…

Trade Practices Commission v Arnotts Ltd
& Others (1989) ATPR 40-979 and (1990) ATPR 41010; (1990) ATPR 41-161 – For market definition
purposes: Real evidence – Biscuits, snack foods.
“Survey evidence” – to establish consumer habits.
“Perception Evidence”.

Australian Gas Light Co. v ACCC
(2003) ATPR 41-956 and (2003) ATPR 41-966 –
Documentary Evidence “strategic business
documents”. Reliance principally on Expert Evidence
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Case Examples continued…

Trade Practices Commission v Australia Meat
Holdings Pty Ltd & Others
(1988) ATPR 40-876 – Market Participants’ Evidence and
Expert Economic Evidence.

Trade Practices Commission v Rank
Commercial Ltd & Others (1994) ATPR 41-324 and
(1994) ATPR 41-331 – Market participants’ (independent
grocery retailers’) evidence
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Sources of Evidence
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Potential Sources of Evidence…
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Target of takeover – “feasibility studies” or
“Board Papers” or other documents;
Industry Participants (especially those likely to
be adversely affected by merger) including
suppliers, customers, competitors, industry
associations;
Government agency reports / industry studies
Experts especially Economists local or
international ;
Overseas Competition Regulators or industry
participants or local customs officials – evidence
as to imports as a constraint
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Skills to Acquire Evidence
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7 Key Evidence Gathering Skills…
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Analytical Ability
Penetrating Questioning Ability
High Level Communication skills – both oral
and written
Organizational Ability
Ability to distill (extract) key issues from large
volume of complex material
Solid understanding of Competition law and/or
Economics.
People Skills – Building Rapport with Witnesses
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Testing Accuracy of Evidence
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Case Examples Testing Evidence…

Evidence Provided Voluntarily by Companies
involved compared with evidence provided by
them under compulsion of law.

Theoretical Economic Evidence compared to
market place investigation and evidence.

Important to remember markets are Dynamic
not Static – so a “with or without the merger
test” analysis requires consideration of real or
likely (not hypothetical /fanciful) developments
eg Import competition; merger between others
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Organising Evidence for Litigation
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Evidence for Litigation…

In Australia, evidence for
litigation in the Courts is at the
highest level of integrity –
because it must pass the laws of
evidence applied by the courts
and also withstand vigorous
cross-examination and scrutiny
by the defence lawyers!
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Evidence in Litigation…

Regardless of the use of the evidence
obtained in an investigation (eg To
write a Report; To make public
statements; To settle a matter
administratively; or to engage in
litigation) – the evidence must be right
(that is, accurate, complete and reliable)
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Evidence in Litigation…

So, the investigator who learns and
applies the skills of an investigator who
intends his/her evidence to be used
before an authority that will rigorously
test the evidence (for example, a Court)
– is unlikely to find himself/herself in
the embarrassing position of getting it
all wrong!
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Evidence in Litigation…
Organising evidence for use in litigation is a
combination of:
 Understanding the elements of the offence or
contravention and organising the evidence
accordingly (for example, evidence on market
definition; evidence about the competition
assessment / effect).
AND
 Managing the different types of evidence to
be introduced (Real evidence, Documentary
evidence, Testimony from people (non experts and expert Economists – who usually
go at the end)
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In Conclusion … Key “Do’s &
Don’ts”
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Don’t…

Rely just on voluntary co-operation from parties
involved in the merger when seeking evidence;

Substitute assurances or theoretical logic (expert or
otherwise) for market place inquires when conducting
investigations;

Allow merger parties to divide and conquer a
Competition authority (Divide a Competition
Authority’s – Commissioners / Executive decision
makers from [investigation] staff)!
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Don’t…

Delay in approaching market place witnesses –
they can be frightened by big market players and
pressured into not giving evidence to competition
authorities;

Try to win cases just on theoretical expert
(economic) evidence – it may sound good but is
unlikely to withstand rigorous practical scrutiny.
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Do…

Engage a team of lawyers and economists to
provide guidance and assistance;

Conduct market place inquires;

Use Statutory powers to get evidence;

Remember markets are dynamic – so consider
other likely developments without the
merger;…
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Do…

Have the infrastructure and staff with the
skills and confidence to move quickly;

Contact your international colleagues;

Prevent a merger of concern from happening
(eg get an injunction, or use cease and desist
powers) rather than relying on divestiture
after the event. It’s impossible to turn an
omlette back into 2 eggs again!!!
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Thank You for your Attention! The End.
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