Re Progressive Enterprises Ltd Decision
19 September 2001 Media Statement
Court Of Appeal Decision Re Progressive Enterprises Limited
"This morning the Court of Appeal overturned the previous decision of the High Court about the proposed acquisition of Woolworths NZ by Progressive Enterprises Ltd" Hon Paul Swain, Minister of Commerce, said today.
Progressive's application for a clearance by the Commerce Commission to buy Woolworths was made before amendments to section 47 of the Commerce Act came into force earlier this year. The Commission considered this application under the old test where business acquisitions had to pass a market dominance test. However, clearance was granted after the new test had become law. The new test is whether the acquisition will substantially lessen competition.
The High Court found that the Commission was correct in applying the old market dominance test under section 47 of the Commerce Act when it assessed the application for clearance from Progressive to acquire Woolworths. However the Court of Appeal has today overturned that decision.
"This decision has implications for a number of businesses, implications which the government is now carefully considering" Mr Swain said.
Mr Swain said that he understood that the Commission may be seeking further direction from the Court as to the effect of this decision on the clearances that have already been granted.