ACCC Decision a Blow for Small Service Station Operators

The ACCC’s decision today to allow the arrangement between Caltex and Woolworths to proceed and to allow the ‘shopper docket’ arrangements between Caltex and Woolworths and Shell and Coles Myer to continue is extremely disappointing.

The Motor Trades Association of Australia believes that the Commission’s decision has now cleared the way for Caltex/Woolworths and Shell/Coles to dominate the retail petroleum sector and for the exit of many small operators from the retail petroleum market.

The Commission has not sought any undertakings from either Shell or Caltex that they will continue to make supply available at competitive prices to smaller operators. The Commission’s report acknowledges that structural changes occurring in the industry may lead to the exit of smaller independent operators from the industry.

MTAA believes that while the shopper docket arrangements may offer some short term benefits to motorists, the impact of them and other market changes on the independent sector will likely result in that benefit diminishing over time.

The only way to ensure that Australian motorists have access to the lowest possible priced fuel is for competition at retail to remain strong and that means there needs to be a diversity of ownership and operation of service stations.

In the face of this decision it is important that there are strong provisions in the Trade Practices Act against the misuse of market power and against unconscionable conduct. MTAA will continue to argue for a strengthening of the Act to ensure that small operators who may be unfairly treated are able to secure redress. MTAA also believes that the Government must as a matter of urgency introduce legislation to implement the Dawson report recommendation for a collective negotiation arrangement for small business.

For more information contact Michael Delaney, Executive Director, MTAA on 02 6273 4333