Blurring the bright line? Third line forcing revisited

Unlike other forms of exclusive dealing, third line forcing is prohibited per se, that is, prohibited irrespective of the effect the conduct has on competition. While this prohibition has been the subject of criticism from courts, parliamentary committees and academics, the way in which the provisions are interpreted has not been the subject of extensive commentary. This article identifies two major problems in the interpretation of third line forcing provisions. First, since the decision in ACCC v IMB Group, there has been a significant shift in the way in which courts characterise whether there are two parties or three to a transaction. As a consequence, it is now more difficult to assess whether courts will treat conduct as third line or full line forcing, which has resulted in a greater degree of uncertainty in commercial transactions. Secondly, there is no structured approach for assessing whether there is a forcing of one product or two. Neither problem has, by and large, been discussed by commentators. This article seeks to address these problems by providing an alternative approach to the way in which courts characterise conduct in the context of third line forcing.