LAW 2501 Lecture Notes - Lecture 6: Betfair, Protectionism, Tasmania

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23 May 2018
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FREEDOM OF INTERSTATE TRADE
Limit on Cth power = s 92: the imposition of uniform
duties of customs, trade, commerce, and intercourse
among States, whether by means of internal carriage or
ocean navigation, shall be absolutely free
*Freedom of intercourse among states not covered
in course
1. Protectionism v free trade
a. protectionism = protect local economy by
imposing taxes on outside goods/ services
b. free trade = trade without limits
2. Protectionism in Au C*
a. s 92 prohibits discriminatory burdens of a
protectionist kind on interstate trade Cole v
Whitfield (1988)
b. Decisions about whether Australia adopts free
trade or protectionist policies in relation to
other counties are left to Cth Parliament
i. allows parliament to determine external
trade policy without interference from
states s 90 Cole v Whitfield
c. s 92 supplements s 90- removes internal
barriers to trade -creates an absence of
protectionism as between the states, a ‘free
trade area’ Cole v Whitfield
PQ Process
1. Clearly determine and state which section of the
legislation applies
a. Who is your client? what does the section do
and how are they affected by it?
2. Identify if Cth or State law
a. If Cth: valid if falls within a s 51 head of
power
b. If state: According to s 5 of the Constitution
Act 1943 (SA), ‘states have plenary legislative
power’. The Commonwealth Constitution
ss106-107 ‘saves’ these powers subject to the
Commonwealth C*. Given this, the State has
the power to make laws for any area
including…
3. However, law will not be valid if it breaches limits
in s 92:
4. s92 prohibits discriminatory burdens of a
protectionist kind on interstate trade Cole v
Whitfield (1988)
a. A burden is protectionist when it protects the
local economy over the interstate economy by
imposing a discriminatory burden
5. Does the law impose a discriminatory burden
on interstate trade?
a. Satisfy a type of discrimination
By requiring any additional practical or
financial requirements on interstate traders
which state traders don’t have
discrimination appear on the face of the law,
or in the operation of the law Castlemaine
Tooheys
SA law prohibited beer being sold in
non-refillable bottles in SA
All major breweries used refillable
bottles, all interstate breweries used
non-refillable bottles
Practical operation = law less
favourable to interstate traders
Discriminatory if the law puts interstate
trade at a competitive disadvantage
compared to local trade Betfair No1;
Castkemaine Tooheys
interstate goods more expensive/
traders prefer not to stock them
Castlemaine Tooheys
a burden is discriminatory in this sense
of it treats interstate trade differently
to intrastate (local) trade in the same
market (substitutability)
Not discriminatory if it is general in
application (criminal law)
b. look to the common circumstances of
interstate trade
question isn’t whether the individual
interstate trader has been burdened (bcos of
their business model etc) but whether
interstate trade gas been burdened bcos of
common circumstances of trade Betfair No 2
6. If the law imposes a discriminatory burden on
interstate trade- it is protectionist UNLESS it
satisfies the ‘regulatory exemption by being
reasonably necessary for the state to achieve a
legitimate non-protectionist purpose
a. Early statement: a law which has as its real
object the prescription of a standard for a
product or a service or a norm of commercial
conduct will not ordinarily be grounded in
protectionism and will not be prohibited by s
92 Cole v Whitfield at 408
b. Current statement
Test = not whether the law is appropriate
and adapted to prescribing a standard or
commercial conduct, but whether the burden
on interstate trade is reasonably necessary
for the State to achieve a legitimate non-
protectionist purpose Betfair v WA and
Betfair v Racing NSW
Strict test- apply to FACTS using following
process
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Document Summary

Limit on cth power = s 92: the imposition of uniform duties of customs, trade, commerce, and intercourse among states, whether by means of internal carriage or ocean navigation, shall be absolutely free. Act 1943 (sa), states have plenary legislative power". The commonwealth constitution ss106-107 saves" these powers subject to the. Sa law prohibited beer being sold in non-refillable bottles in sa. All major breweries used refillable bottles, all interstate breweries used non-refillable bottles. Practical operation = law less favourable to interstate traders: discriminatory if the law puts interstate trade at a competitive disadvantage compared to local trade betfair no1; Interstate goods more expensive/ traders prefer not to stock them. Betfair v racing nsw: strict test- apply to facts using following process. If the law purports to be for a non- protectionist purpose, but it does not achieve this purpose, cannot be justified by the exemption. Arguments for govt: not less burdensome bcos too expensive for.

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