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Mobil signs watchdog’s fuel price-swap undertaking

Flame war: Mobil has signed an undertaking that prevents it from using fuel pricing information that could be swapped with other retailers.

Fuel retailer says it won’t visit price-swapping website as part of ACCC deal

26 Aug 2014

FUEL retailer Mobil has agreed to stay away from using potential price-swapping services for five years ahead of a consumer watchdog crackdown on the practice.

The Australian Competition and Consumer Commission (ACCC) said today that Mobil had signed a court-ordered undertaking saying it would stay away from any form of electronic retail petrol price information exchange service.

In return, the ACCC said it recognised that Mobil had sold all its retail assets in 2010 as part of a deal struck with convenience shopping specialist 7-Eleven, and “after taking into account that Mobil ceased subscribing to the Informed Sources service some time ago”.

The ACCC is taking several fuel retailers to court alleging that the Informed Sources service provided a website that the companies could access to see retail prices of competitors around Australia, resulting in price-sharing agreements that are banned under the Competition and Consumer Act 2010.

“The ACCC has accepted the undertaking from Mobil and has not joined it to the Federal Court proceedings after taking into account that Mobil ceased subscribing to the Informed Sources service some time ago and has undertaken not to subscribe to similar services for five years,” it said in a statement announcing Mobil’s submission to the undertaking.

Other fuel retailers yet to answer the ACCC’s allegations include BP Australia, Caltex Australia, Eureka Operations operating as Coles Express, Woolworths, and the company that Mobil sold its retail assets to, 7-Eleven.

“The ACCC alleges that the arrangements were likely to increase retail petrol price coordination and cooperation, and were likely to decrease competitive rivalry,” ACCC chairman Rod Sims said while announcing the launch of Federal Court action last week.

“Given the importance of price competition in petrol retailing, the ACCC is concerned that consumers may be paying more for petrol as a result.”

According to the ACCC’s filings, subscribers to the Informed Sources service were providing pricing data to Informed Sources at frequent, regular intervals and in return receiving collated data from other subscribers, and various reports containing pricing information across particular regions.

“The ACCC alleges that fuel retailers can use, and have used, the Informed Sources service as a near real time communication device in relation to petrol pricing,” Mr Sims said.

“In particular, it is alleged that retailers can propose a price increase to their competitors and monitor the response to it.

“If, for example, the response is not sufficient, they can quickly withdraw the proposal and may punish competitors that have not accepted the proposed increased price,” he said.

Informed Sources has denied the allegations, calling them “unjustified” and saying it still did not understand the charges being brought against it.

“Without a clear understanding of what issues the ACCC has concerns with, this final step of legal action amounts to bullying,” a media release from Informed Sources managing director Alan Cadd said.

“We maintain our belief that every aspect of our service is pro-competitive and lawful and we are confident that the Australian legal system will uphold our position so we can continue to serve the industry and the motoring public and help consumers save money.”

The first directions hearing in the case will be heard before Justice Murphy sitting in the Melbourne branch of the Federal Court in September 26.

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