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Back to NCP Review of the Uniform Trade
Measurement Legislation Index
Review Committee Report on
the
National Competition Policy Review of the
Uniform Trade Measurement Legislation
Stage 2
Public Benefit Test Report
April 2002 Draft Version 002
The views expressed in this Report are the views
of the Review Committee only and do not represent the views of State
and Territory Governments.
TABLE OF CONTENTS
1. EXECUTIVE SUMMARY 3
2. INTRODUCTION 5
2. METHODOLOGY 7
3. OBJECTIVES OF THE LEGISLATION
10
4. NATURE OF THE RESTRICTION ON COMPETITION
12
4.1 Description of the Restriction:
12
4.2 Classification of the Restriction:
15
4.3 Objective of the Restriction:
16
5. EFFECT OF THE RESTRICTION ON COMPETITION
19
6. ALTERNATIVE APPROACHES.
39
6.1 Deregulation:
39
6.1.1 Impact on Meat sellers:
39
6.1.2 Impact on Consumers:
42
6.1.3 Impact on Government:
43
6.1.4 Overall Impact of Moving to a Deregulated State:
43
6.2 Modification to the Current Restriction
44
6.2.1 Impact on Meat sellers:
45
6.2.2 Impact on Consumers:
46
6.2.3 Impact on Government:
46
6.2.4 Overall Impact of Moving to the Alternative State:
47
7. CONSULTATION:
49
7.1 Industry: 49
7.2 Consumers: 53
8. RECOMMENDATION/S:
58
1. Executive Summary
The restriction on the sale of non-prepacked meat is uniform in
all Australian jurisdictions (except Western Australia) and requires
that non-prepacked meat be sold at a price determined by reference
to the mass of the meat (ie price per kilogram). This restriction
simplifies the selling process by requiring a standard basis for
comparison. It is a minor restriction that can be classified as
a control on the method of sale and a control on the form of pricing.
The restriction meets the objectives of the legislation by promoting
commercial certainty through the minimisation of transaction costs
and providing an equal trading platform from which meat sellers
can trade. It also provides consumer protection, which maintains
consumer confidence.
Meat sellers, consumers and governments are the three key stakeholder
groups affected by the restriction. The public benefit test found
that there is justification to continue regulating the sale of non-prepacked
meat as the potential benefits to the wider community outweigh the
identified costs of the restriction. The overall assessment is that
the restriction generates a small net benefit to the community.
Two possible alternatives to the current restriction were identified.
The first was to remove the restriction on the sale of non-prepacked
meat. It was found that moving to a deregulated state would result
in an overall small negative impact to the community. The greatest
impact would be felt by consumers who would face a small to moderate
negative impact of moving to a deregulated state.
A second alternative was to modify the restriction by clarifying
the definition of meat to remove current uncertainties. These uncertainties
surround whether fish and poultry are included in the definition
and when processed meat ceases to be meat for the purposes of the
restriction. Clarifying the definition of meat would mean that the
restriction would more adequately meet the objectives of the legislation
by creating more certainty for meat sellers.
It was found that meat sellers, in all jurisdictions except Queensland,
Victoria and the Northern Territory, would derive a small positive
impact from the clarification of the definition of meat. In Queensland,
Victoria and the Northern Territory, red meat sellers would derive
a small positive impact, while poultry and fish sellers would face
a small negative impact. Consumers would derive a moderate positive
impact, while governments would face a very small negative impact.
Overall, there would be a moderate positive impact to the community
in moving to this alterative state.
Therefore, it is recommended that the definition of meat be reviewed
to determine whether the definition of meat should expressly include
fish and poultry and that the definition of meat be expanded to
clarify when specialised meat products cease to be meat for the
purposes of the restriction.
In reviewing the definition of meat, the Review Committee further
recommends that the Trade Measurement Advisory Committee (TMAC)
be involved in the review and decision-making process.
In clarifying the definition to increase certainty for meat sellers,
care will need to be taken to ensure that any changes do not unnecessarily
inhibit product innovation.
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