Copping a servo: stop Caltex buying Mobil’s stations

Why the urgency? Well, that’s because the ACCC yesterday released its so-called “Statement of Issues” concerning Caltex’s proposed acquisition of 302 Mobil service stations.

That ACCC Statement of Issues confirms for all to see that the competition concerns surrounding the proposed Caltex acquisition are so large and so wide-ranging that the ACCC would have the ability under our competition law - the Trade Practices Act - to stop the acquisition.

The ACCC presents a very compelling case that the Caltex acquisition is likely to substantially lessen competition in a number of key petrol, diesel and LPG markets.

A finding that an acquisition is likely to substantially lessen competition has very serious legal ramifications as such a finding would represent a breach of s 50 of the Trade Practices Act and would empower the ACCC to block the acquisition.

Statements from the ACCC that it has formed the preliminary view that the Caltex acquisition is likely to have the effect of substantially lessening of competition in markets for the wholesale supply and distribution of petrol and diesel in NSW and Queensland is of deep concern to motorists.

Of similar concern to motorists is the ACCC’s indication that the Caltex acquisition may also raise competition concerns in wholesale petrol and diesel markets in Victoria and South Australia.

The ACCC goes further and expresses concerns that the Caltex acquisition is likely to significantly increase Caltex’s ability to raise wholesale petrol and diesel prices, which in turn would allow Caltex to push up retail petrol and diesel prices.

Finally, the ACCC’s concerns at the wholesale level are backed up by additional strong concerns regarding the acquisition’s potentially adverse impact on specific local retail markets.

Of particular concern to motorists is the fact that the ACCC went so far as to identify dozens of particular locations where the Caltex acquisition of Mobil service stations could substantially lessen competition in local petrol, diesel and LPG markets.

When taken together, the ACCC’s preliminary findings are sufficiently compelling for the ACCC to seek a court injunction to stop Caltex’s acquisition of the Mobil service stations.

Clearly, the Caltex acquisition of Mobil service stations represents a very real and substantial threat to oil industry competition in major Australian wholesale and retail markets and must be stopped by the ACCC in the interests of motorists.