The Australian Competition and Consumer Commission has resolved Federal Court proceedings against Informed Sources (Australia) Pty Ltd (Informed Sources) and four petrol retailers in relation to the petrol price information exchange service operated by Informed Sources. The ACCC took proceedings against Informed Sources and several petrol retailers that subscribe to the service, including:
- BP Australia Pty Ltd (BP)
- Caltex Australia Petroleum Pty Ltd (Caltex)
- Woolworths Ltd (Woolworths)
- 7-Eleven Stores Pty Ltd (7-Eleven).
“I welcome and appreciate the decision of Informed Sources and the petrol retailers to make the pricing information available to consumers at the same time the retailers receive it. This will help consumers make better and more informed decisions about where and when to buy petrol by helping them identify the best time to buy and the sites with the lowest price,” ACCC Chairman Rod Sims said.
The ACCC alleged that the price information exchange service in its current form allows those retailers to communicate with each other about their prices, and has the effect or likely effect of substantially lessening competition for the sale of petrol in Melbourne.
“The ACCC believes that greater transparency of petrol prices and the behaviour of petrol retailers across Australia will reduce the potential for any adverse effect of the Informed Sources service on competition,” Mr Sims said.
Under the Informed Sources service, these petrol retailers currently exchange site by site petrol prices covering most of Australia every 15 or 30 minutes.
“The resolution of this matter will enable consumers to access petrol prices in their local area or in areas along their journey. These prices will be updated every 15 or 30 minutes,” Mr Sims said.
“Another key outcome is the availability of the retail price information to third party service providers. This will promote innovation in the provision of petrol price information, to the benefit of consumers.”
The retail petrol pricing data will also be available to consumer, motoring, and research organisations.
“The ACCC believes that this will facilitate improved competition amongst petrol retailers,” Mr Sims said.
“Making this pricing information available to consumers will allow consumers to make better informed purchasing decisions and therefore create greater competition in petrol pricing. ”
BP, Caltex, Woolworths, and 7-Eleven have agreed that they will not enter into or give effect to any price information exchange service unless the information each receives is made available to consumers and third party organisations at the same time.
Informed Sources has agreed that it will not supply the information exchange service unless the pricing information it provides to petrol retailers is made available to consumers for free and to third parties on reasonable commercial terms at the same time.
While they subscribe to a price information exchange service, the parties have agreed to allow the petrol pricing information to be made available to consumers and third party organisations for a period of 5 years commencing by mid-2016. As a result of the undertakings, the ACCC has consented to orders by the Federal Court that the proceedings be discontinued with no order as to costs.
Background
In August 2014, the ACCC instituted proceedings in the Federal Court of Australia against Informed Sources and the following petrol retailers alleging that they contravened section 45 of the Competition and Consumer Act 2010 (the Act):
- BP Australia Pty Ltd
- Caltex Australia Petroleum Pty Ltd
- Eureka Operations Pty Ltd (trading as Coles Express)
- Woolworths Ltd
- 7-Eleven Stores Pty Ltd.
Section 45 of the Act prohibits contracts, arrangements or understandings that have the purpose, effect or likely effect of substantially lessening competition.
The proceedings followed an extensive investigation by the ACCC into the exchange of price information among these retailers through the Informed Sources service.
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.
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 Sources information exchange service or similar services for a period of 5 years.
On 16 December 2015 the ACCC accepted a court enforceable undertaking from Coles Express, in which Coles Express agreed that it would terminate its agreement with Informed Sources at the expiration of its current contract and would not for a period of 5 years make or enter into a similar price information exchange service. As a result, the ACCC and Coles Express consented to orders made by the Federal Court that the proceedings be discontinued against Coles Express.