You have to admire the ACCC chutzpah

The ACCC has resumed hostilities against Informed Sources.

The Australian Competition and Consumer Commission (ACCC) has also alleged that petrol pricing website, Informed Sources, which collects pump prices from each of the petrol retailers, allowed the retailers to “communicate with each other about their prices, and that these arrangements had the effect, or likely effect, of substantially lessening competition in markets for the sale of petrol in Melbourne”.

ACCC chairman Rod Sims said the arrangements were “likely to increase retail petrol price coordination and cooperation, and were likely to decrease competitive rivalry”.

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

Got that? “[T]he ACCC is concerned that consumers may be paying more for petrol as a result”. Wow. Would that be the same ACCC that reduced competition in the petrol market by limiting petrol discount dockets to 4c?

Australian National Retailers Association chief executive Margy Osmond said the ACCC should focus on “getting the best outcome for consumers”.

“Cutting shopper docket discounts doesn’t seem to have reduced petrol prices,’’ she said. “How in touch is the ACCC with consumers?”

Mr Sims said the ACCC’s investigation clearly showed that when shopper docket discounts were above 4c-a-litre, independent operators did not compete by lowering prices because they could not afford it.

Yep – competition policy makes the world safer for inefficient competitors.

I just wonder what has changed since the ACCC last persecuted Informed Sources?

It had long been under ACCC scrutiny, with the regulator’s head, Graeme Samuel, saying in 2008 that it was ‘‘as close to being illegally collusive as we can find, but it is not illegal’’.

A lot of the nastiness that surrounded the FuelWatch scheme involved the ACCC’s vendetta against Informed Sources.

(HT: HG)

This entry was posted in Economics and economy, Hypocrisy of progressives. Bookmark the permalink.

47 Responses to You have to admire the ACCC chutzpah

  1. pete m

    The ACCC are morons.

    They forced Informed Sources to hand over GB of data to try to prove price collusion, but couldn’t understand the data.

    So now they feel a Court might help them out.

    COMPLETE TOTAL MORONS.

    How can a govt agency be so stupid? wait….

    Anyway, I await a Court finally getting thru to the ACCC that information gathered in 1 place is not illegal, that it does the reverse of their allegation and actually makes competition quicker (remember old days of binoculars and drive bys?) and in the end helps consumers.

    Then the Minister needs to conduct a thorough clean out.

  2. Aynsley Kellow

    Forgive me – I’m only a poor political scientist – but how does information about the price goods are being offered by others drive the price up? I thought it allowed all sellers to know if the prices at which they are offering their goods is out of line with the market – up or down. Will the ACCC prevent the ASX from publishing prices at which stocks are being exchanged?

  3. Infidel Tiger

    So when the ACCC lose again, can we recover costs from them individually?

    The trouble is that this vexatious idiocy from the ACCC plays well with the general public who are convinced petrol would be 50c a litre without Big Oil and Big Supermarket.

  4. Infidel Tiger

    Are they going to ban those signs out the front of servos?

  5. .

    Aynsley Kellow
    #1424703, posted on August 21, 2014 at 10:18 am
    Forgive me – I’m only a poor political scientist – but how does information about the price goods are being offered by others drive the price up?

    Correct, Aynsley. This doesn’t drive the price up at all.

    Otherwise de Beers would not sell *you* unopened boxes of uncut diamonds.

  6. Mike of Marion

    IT, I reckon the ACCC would like to. We’d have to drive up to an actual pump to see the listed price.

    ACCC are doing untold damage to Australian commerce.

  7. Grey ghost who walks

    What is with Rod Sims and his cohorts at that superfluous ACCC?
    It is an absolute waste of time and resources this dill produces on a daily basis. I thought the previous blokes were bad enough for wasting money with their hopeless legal prosecutions and carry on, but this one really does, take the cake!

  8. Joe

    So the ACCC going after the ASX next for gathering the price of stocks in one place and driving the prices up.
    Idiots wouldn’t know a market if the fish struck them in the face.

  9. rebel with cause

    I frequently see Coles employees in Woolies scribbling down ticket prices and vice versa. Look forward to seeing the fruit and veg kid being gang tackled by ACCC staff for price collusion.

  10. rebel with cause

    No wonder jousting sticks are so expensive. Sellers have been using the Trading Post to collude on price.

  11. Roger

    But the ACCC is still blind to CFMEU thuggery…

  12. johanna

    Now we know why Grocerywatch never got up. Kevni received advice that the ACCC would come after it.

    lol re jousting sticks! rebel wins the internet this morning. :)

  13. DaveA

    So what is a ‘correct’ price for petrol? Is it a certain margin, with fees and taxes accounted? What margin is that? ACCC should come out and say – can’t just say it’s too much but say what it should be.

    Or they could let competition reign and piss off.

  14. squawkbox

    All together now, the Rabz Chorus with full brass band accompaniment:

    SHUT IT DOWN
    FIRE THEM ALL

  15. .

    http://www.aip.com.au/pricing/facts/Facts_About_the_Australian_Retail_Fuels_Market_and_Prices.htm

    Government taxes comprise a fixed excise rate of 38.143 cents per litre on petrol and diesel plus GST of 10 per cent on the final retail price.

    In 2012–13, the tax component (GST and fuel excise) of the retail price of petrol averaged about 36 per cent or 51 cents per litre. Payments to the Australian government in 2012 (from fuel excise, GST on fuels and income tax) was over $20 billion.

  16. Ant

    Does the ‘A’ in ACCC stand for “Arseclown”?

  17. Bruce J

    What number is this enquiry into petrol pricing? It must be at least the 20th since the ACCC came into existence. Imagine how much lower the price of fuel would be if the retailers, the oil companies and the ACCC had not needed to employ high price lawyers to stand up and abuse each other in front an enquiry panel who have no knowledge of how business works! But then again, if there are no enquiries, there is no need for an ACCC and how would all those bureaucrats find a job in the real world?

  18. Dr Faustus

    Mr Sims said the Informed Sources service meant retailers were able to view petrol prices in real time, allowing them to “propose” a price increase to competitors by putting up their own prices and then monitoring whether the rest of the market followed suit.

    Presumably Mr Sims would prefer petrol retailers to be less efficient in discovering the market price for their product. Not sure how that actually benefits purchasers – presumably the ACCC is trying to support an imperfect market in which retailers misprice from time to time and deliver an occasional windfall gain to motorists.

    That all sounds consistent with Welfare Australia. Carry on then – enforceable undertakings all round.

  19. .

    The extent of “price fixing” is outweighed many times over by the usurious double taxation of fuel!

  20. Peter from SA

    Meanwhile … Boral can’t pour concrete in the Melbourne CBD … does Mr Sims and his cronies even give a toss?

  21. johanna

    Good point, Peter from SA. The ACCC doesn’t give a damn about CFMEU standover tactics. They are too busy pursuing supermarket chains about petrol vouchers.

  22. Georgio

    Stupid governments establish jobs for the mates things like accc,asada,race discrimination,civil rights workcover OHS .then the mates cause trouble for innocent people ,it makes it look like they are working ,bludging mongrels,Rabz the lot of them,pay the debts off much quicker without these wankers.

  23. Casey

    I have a “great” idea for the ACCC.
    There is absolutely nothing worse than a well informed market! Published prices falicitate collusion among sellers.
    Let’s stop the online posting of any product prices. A blanket ban. No more hunting online for the best price of your Westinghouse refrigerator, or your Sony 60 inch flat screen, or Bonds t-shirts.
    Perhaps even ban all product price advertisements from newspapers.
    Maybe even ban posting the prices at which shares trade on the ASX – just randomly match overlapping bids and offers.

  24. Boambee John

    “how would all those bureaucrats find a job in the real world?”

    I am regretfully coming to the view that the principal purpose of many public service organisation (Commonwealth, state and local government, to say nothing of the plague of pestiferous “independent”agencies is to provide jobs for otherwise unemployable holders of various brands of Arts degrees, including the social “sciences”!

  25. Jack

    Gee, all those online price comparison sites must be illegal as well…

  26. Diogenes

    And the “independent” ACCC is a good reason not to have an “independent ” Tax Commission

  27. Jeff

    Increasing shopper docket discounts will reduce independent competition

  28. Nato

    I remember a guest post from once upon a time. JC made a similar point with his usual polemic, but I’ll quote Alan Grey http://catallaxyfiles.com/2014/03/19/guest-post-nato-riding-in-defence-of-unions/comment-page-1/#comment-1232597

    When companies get together to fix prices we call it price collusion and prosecute.
    When employees get together to fix prices we call it a union.

    It seems companies don’t even need to get together any more for us to call it price collusion and prosecute.

  29. Andrew

    So if the ACCC think that the price information causes unfair competition and higher prices across the various companies, surely if one of the petrol companies lowered their prices then they would gain market share from the other petrol companies? If anything, the price information facilitates greater competition instead of impeding it.

  30. Rabz

    Depressing and infuriating – what a bunch of useless, tax hoovering morons.

  31. AP

    the average petrol price chart for Perth on the Informed Sources website certainly suggests a good deal of collusion.

  32. AP

    Or perhaps some other price signalling behaviour. There is certainly a lot more regularity to it than one would expect under a highly competitive environment.

    https://www.informedsources.com/petrol-pricing.aspx#PerthPriceGraph

  33. .

    “AP
    #1425390, posted on August 21, 2014 at 7:15 pm
    the average petrol price chart for Perth on the Informed Sources website certainly suggests a good deal of collusion.”

    No.

    No it doesn’t.

    The market is clearing and is efficient, albeit with excess capacity to ensure short term shortages rarely if not never happen.

  34. A happy little debunker

    As a bit player within one of the companies being investigated. I can honestly inform readers that the paranoia within this industry over issues of price fixing extends down to the lowly local console operator.
    That operator is required to attend competeancy based training to demonstrate their understanding of price collusion and fixing and the requirement to not engage in that activity, on pain of instant dismissal.

    Operators are not even allowed to quote pump prices over the phone, just in case it is someone else trying fix their price.

    I am suprised that the ACCC thinks that these companies are colluding.

  35. 2dogs

    Is there any research on the impact on consumers of collusion versus barriers to entry (regulatory in particular)?

    Maybe this is something the IPA would consider doing a paper on?

  36. nerblnob

    There is certainly a lot more regularity to it than one would expect under a highly competitive environment.

    Isn’t that what you’d expect of a highly-competitive environment?

  37. Tel

    God knows what might happen if people go together to make bids and offers for company shares. They might end up being able to see the price that other people are trading.

  38. Tel

    Let’s stop the online posting of any product prices. A blanket ban. No more hunting online for the best price of your Westinghouse refrigerator, or your Sony 60 inch flat screen, or Bonds t-shirts.

    No no no, not nearly good enough. The only way to fully stop this disgraceful collusion is to do the job properly — whatever it takes!

    We must stop the buyer knowing the price of goods. Anyone willing to make a purchase simply signs a blank cheque, and random funds are deducted one week later. We cannot allow ourselves to get soft on market failures… I’m bloody well concerned that someone somewhere may be paying more or less or the same as some other price. It’s concerning, we should all be concerned.

    Do it for Team Australia!!

  39. whyisitso

    We’d have to drive up to an actual pump to see the listed price.

    Even better still – wait until after we’ve entered our PIN while paying for it inside the servo. Prices must be kept very confidential.

  40. Dan

    I got a discount yesterday for cheap booze and $5 off my next shop. Damn those groceries subsidising these discounts

  41. simon Says

    >Yep – competition policy makes the world safer for inefficient competitors.

    More likely it helps smaller business in “competition” in unfair competition with large CORPORATES who can cross-subsidize their pricing from their other non-fuel industry sectors (in which they dominate). Fruit salad kills apples-only every time. The issue for me is that without the policy all CORPORATES would be able to enter any market and destroy its “competitors” (eg mum and dad small business). I don’t want to live in a corporate state: big govt with big unions and big corporates running everything.

  42. Yobbo

    Interesting graphs on informed sources:

    https://www.informedsources.com/petrol-pricing.aspx#PerthPriceGraph

    Why does petrol in Perth get cheaper on every successive day in the week, bottoming out on Wednesdays and then spiking on Thursdays? It doesn’t happen in any other city.

    Any theories?

  43. wreckage

    Or perhaps some other price signalling behaviour. There is certainly a lot more regularity to it than one would expect under a highly competitive environment.

    The more perfectly competitive, the less variation between sellers there will be.

  44. wreckage

    More likely it helps smaller business in “competition” in unfair competition with large CORPORATES who can cross-subsidize their pricing from their other non-fuel industry sectors

    No. Policy barriers advantage large incumbents and disadvantage the small and new business. Also, cross-subsidizing goods is also known as “business”. If you can’t compete with that, find grounds on which you CAN compete.

    There’s a reason why governments of all stripes always increase regulations: it benefits them by appearing pro-active, and it benefits their portfolios by killing off competition.

    The mathematics are simple: to remain in compliance with any sheaf of regulations you need to hire one or more compliance experts. If you have 5000 employees, this additional cost is negligible. If it’s just you and the spouse, you’re done. It’s over. Back on the dole queue you go.

    Rigid economies favour big business and people who already have jobs, or have excellent connections. It’s just a fact. Accept it and move on.

  45. stackja

    Liberty Quotes
    “Free competition enforced by law” is a grotesque contradiction in terms.
    — Ayn Rand

  46. .

    simon Says
    #1426800, posted on August 23, 2014 at 10:02 am
    >Yep – competition policy makes the world safer for inefficient competitors.

    More likely it helps smaller business in “competition” in unfair competition with large CORPORATES who can cross-subsidize their pricing from their other non-fuel industry sectors (in which they dominate). Fruit salad kills apples-only every time.

    What a load of nonsense. Plenty of small businesses only offer one service or product.

    As do some large corporations.

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