Regulatory Power and Free Trade: The Rules of Engagement in the Era of De-Regulation

Abstract

In this paper, the writer sets out his beliefs as to what freedom of trade is about. In a commercial context, freedom of trade is the opposite of being "regulated" i.e. having to make submissions to government for orders, licences or permission to do various things. The writer makes the point that regulation can be carried out either by government or by private regulators. Strong competition law, therefore, is important in preserving the right of an individual to trade free of constraints imposed by private regulatory interests. The need for regulation is discussed and a series of questions posed for consideration prior to the imposition of a regulatory solution to a problem. The writer believes that freedom of trade under regulatory law is best preserved by regulatory systems that both address the regulatory need and ensure regulatory fairness of decision making. He discusses the Access Regime under PART IIIA of the Trade Practices Act and specific telecommunications regulation, possibly the two most prominent examples of recent regulatory regimes, in this context and concludes that each has been shown to be severely lacking. The writer believes that freedom of decision making is an economic and social value to be preserved. Regulation should thus be restricted to the curing of specific ills in the economy. It is a tragedy if we are overregulated. But, he says, there are many losers in the competition world and governments cannot simply "leave it to the market to decide". Competition, he says, also leaves in its tracks a variety of hardships which must be picked up if we are to have a society which is not only efficient but is also caring and kind.