The Chairman of the Australian Competition and Consumer Commission, Professor Allan Fels, today issued this statement to correct misconceptions about petrol/grocery sales:
"In recent days there has been some publicity concerning the practice of linking the sale of petrol to grocery purchases.
"The Woolworths petrol group, for example, sells petrol at a discount to customers who buy groceries from Woolworths supermarkets. This probably constitutes 'third line forcing'. Third line forcing, that is tying the sale of one product to the sale of another, can breach s47(6) and (7) of the Trade Practices Act.
"However the practice can be notified to the ACCC under s93 (1). The notification gives the practice immunity from court proceedings unless the ACCC decides the notification cannot stand as the conduct is against the public interest.
"Woolworths has notified its practice in respect of its petrol/groceries arrangements. After seeking public comment the ACCC let the practice stand.
"Some other service stations are now linking the sale of groceries and petrol.
"Woolworths complained to the ACCC about a small retailer of petrol in a country town in Victoria offering an arrangement similar to Woolworths'. In response to Woolworths complaint the ACCC wrote to that retailer to explain the law and to point out that the practice could technically be in breach of s47(6) or (7) of the Act.
"However the letter clearly indicated that the ACCC would not be taking any action. It did however draw attention to the fact that under the Trade Practices Act it is possible for private parties to take legal action over these matters.
"Where the practice is being undertaken by a large business such as a major supermarket chain or a large oil company, the ACCC would expect notification under s93. However as the ACCC's letter to the small Victorian retailer indicates, it is not requesting notification from small players nor will it take any legal proceedings."
Further information Professor Allan Fels, Chairman, (03) 9290 1812 or pager (016) 373 536 Ms Lin Enright, Director, Public Relations, (06) 264 2808
"In recent days there has been some publicity concerning the practice of linking the sale of petrol to grocery purchases.
"The Woolworths petrol group, for example, sells petrol at a discount to customers who buy groceries from Woolworths supermarkets. This probably constitutes 'third line forcing'. Third line forcing, that is tying the sale of one product to the sale of another, can breach s47(6) and (7) of the Trade Practices Act.
"However the practice can be notified to the ACCC under s93 (1). The notification gives the practice immunity from court proceedings unless the ACCC decides the notification cannot stand as the conduct is against the public interest.
"Woolworths has notified its practice in respect of its petrol/groceries arrangements. After seeking public comment the ACCC let the practice stand.
"Some other service stations are now linking the sale of groceries and petrol.
"Woolworths complained to the ACCC about a small retailer of petrol in a country town in Victoria offering an arrangement similar to Woolworths'. In response to Woolworths complaint the ACCC wrote to that retailer to explain the law and to point out that the practice could technically be in breach of s47(6) or (7) of the Act.
"However the letter clearly indicated that the ACCC would not be taking any action. It did however draw attention to the fact that under the Trade Practices Act it is possible for private parties to take legal action over these matters.
"Where the practice is being undertaken by a large business such as a major supermarket chain or a large oil company, the ACCC would expect notification under s93. However as the ACCC's letter to the small Victorian retailer indicates, it is not requesting notification from small players nor will it take any legal proceedings."
Further information Professor Allan Fels, Chairman, (03) 9290 1812 or pager (016) 373 536 Ms Lin Enright, Director, Public Relations, (06) 264 2808