Coles Express Agrees To End Petrol Price Sharing
Tuesday 5 January 2016 @ 10.34 a.m. | Trade & Commerce
The Australian Competition and Consumer Commission (ACCC) has resolved Federal Court proceedings against Eureka Australia Petroleum Pty Ltd (trading as Coles Express) in relation to its subscription to a petrol price information sharing service operated by Informed Sources (Australia) Pty Ltd (Informed Sources).
Background
During August 2014, the ACCC instituted proceedings in the Federal Court of Australia against Informed Sources and several petrol retailers alleging that they contravened s 45 of the Competition and Consumer Act 2010 (Cth) (the Act).
Section 45 of the Act prohibits contracts, arrangements or understandings that have the purpose, effect or likely effect of substantially lessening competition.
Subscribers to the Informed Sources service provide pricing data to Informed Sources at frequent, regular intervals and in return receive from it collated data from the other subscribers, and various reports containing pricing information across particular regions.
The proceedings followed an extensive investigation by the ACCC into price information sharing arrangements in the retail petrol industry.
The Allegations
The ACCC alleges that the information sharing arrangement operated between Informed Sources and several petrol retailers, including Coles Express, allows those retailers to communicate with each other about their prices, and that those arrangements have the effect or likely effect of substantially lessening competition in markets for the sale of petrol in Melbourne.
Eureka Australia Petroleum Pty Ltd said it will terminate its subscription to Informed Sources once its current contract expires in April 2016, and has consented to orders made by the Federal Court enforcing that action:
- not to enter into any price information sharing service agreement that is similar to the one operated by Informed Sources; and
- not to give effect to any such arrangement at the expiration of the current term of its agreement with Informed Sources in April 2016.
The Federal Court also ordered, by consent, that the proceedings against Coles Express be discontinued.
Comment from the ACCC Chairman
The Chairman of the ACCC, Rod Sims said in a recent ACCC Media Release:
“I welcome and appreciate the decision of Coles Express to cease using the Informed Sources information sharing service at the earliest available opportunity, and without the need to go to a court hearing. The ACCC considers this to be an extremely positive step towards increasing competition in the petrol market, and is pleased to see this independent initiative by Coles Express.”
Further ACCC Proceedings
The remaining petrol retailers involved in the ACCC’s proceedings are:
- BP Australia Pty Ltd;
- Caltex Australia Petroleum Pty Ltd;
- Woolworths Ltd; and
- 7-Eleven Stores Pty Ltd.
On 19 August 2014 the ACCC accepted a court enforceable undertaking from Mobil Oil Australia Pty Ltd (Mobil), in which Mobil agreed that it would not subscribe to the Informed Source information sharing service for a period of 5 years. The ACCC is seeking declarations, injunctions, pecuniary penalties and costs against the remaining parties.
An ACCC report from December 2015 showed that retail petrol price margins were at the highest level since the regulator began monitoring them in 2002. The report examined petrol prices up to September 2015.
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Sources:
Coles Express agrees to end petrol price sharing – abc.net.au
ACCC and Coles Express resolve petrol price information sharing proceedings – ACCC Release MR 259/15
