Competition watchdog says biggest brands use a web service to exchange information and that consumers are losing out

This article is more than 6 years old

This article is more than 6 years old

Australia’s consumer watchdog has launched court action against petrol retailers and a leading petrol pricing website for their alleged involvement in price collusion.



The Australian Competition and Consumer Commission [ACCC] said fuel and retail giants BP, Caltex, Coles, Woolworths and 7-Eleven use a service provided by Informed Sources to communicate with each other about their prices in near real-time.

Doing so may have substantially decreased competition for petrol sales in Melbourne, the ACCC chairman, Rod Sims, alleged.



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



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



“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.”



The Informed Sources service covers most capital cities and many regional centres across Australia.



On its website, Informed Sources lists a number of claims about the company which it says are myths, including that it is “a secret information exchange for fuel retailers”.



Its managing director, Alan Cadd, said the company was a small business and the claims from the ACCC were wrong.



“The ACCC investigation into Informed Sources oil price watch service has taken 2 years and 3 months – an extraordinarily long time for any company to wait not knowing its fate,” he said.



“During this time Informed Sources has been the subject of an ACCC press release, commentary from senate estimates and under continuous inquiry from journalists and commentators – all of which damages brand reputation.”



A net petrol price increase of one cent per litre over a year represented a loss to Australian consumers of around $190m, the ACCC said.



Caltex rejected the allegations and says it will defend the ACCC action.



“The data consists of pricing information that is otherwise publicly available to everyone on petrol price boards,” it said in a statement. “The OPW service simply makes it cheaper for subscribers to collect this data.”

Informed Sources had no firm understanding of the claims filed against us them in federal court or the ACCC’s key concerns, Cadd said.



“Informed Sources is a small business and I think it is wrong for Informed Sources to be caught up in what appears to be a test case about the ACCC’s theories on price board information.”



Informed Sources only used historical and publicly available price board/pump data, he said.

The ACCC has successfully taken on petrol retailers before.



In a separate case brought before the court by the ACCC in April, it was found Woolworths had breached an undertaking it made to the watchdog to limit petrol discounts offered on grocery purchases to four cents per litre.