The Australian Competition and Consumer Commission* will not oppose the acquisition of City International Duty Free by M.S. McLeod Holdings Limited, trading as Downtown Duty Free, ACCC Chairman, Professor Allan Fels, said today.
City International Duty Free and Downtown Duty Free are "dedicated" duty free operators selling goods free of sales tax and customs and excise duty.
"The Commission has some concerns about the capacity of a merged Downtown Duty Free/City International Duty Free to increase the price of sales tax free goods. As a result, the ACCC will monitor this market segment.
"Although the acquisition will remove an effective competitor from the market, there are other dedicated duty free chains that compete in the same industry. Further, travellers may choose to buy products from inflight duty free services or at their international destination. Moreover, about 740 retailers around Australia offer sales tax free services to travellers. Collectively, these retailers represent a competitive threat to dedicated duty free chains.
"The ACCC has noted that some travellers, particularly first time travellers, are not fully informed as to the sales tax free service provided by retailers other than the dedicated duty free outlets.
"Consumers planning to purchase duty free goods should shop around, including to sales tax free retailers. For example, camera shops and hi-fi shops offer specialist knowledge, a wide range of products and competitive sales tax free prices," Professor Fels said.
City International Duty Free and Downtown Duty Free are "dedicated" duty free operators selling goods free of sales tax and customs and excise duty.
"The Commission has some concerns about the capacity of a merged Downtown Duty Free/City International Duty Free to increase the price of sales tax free goods. As a result, the ACCC will monitor this market segment.
"Although the acquisition will remove an effective competitor from the market, there are other dedicated duty free chains that compete in the same industry. Further, travellers may choose to buy products from inflight duty free services or at their international destination. Moreover, about 740 retailers around Australia offer sales tax free services to travellers. Collectively, these retailers represent a competitive threat to dedicated duty free chains.
"The ACCC has noted that some travellers, particularly first time travellers, are not fully informed as to the sales tax free service provided by retailers other than the dedicated duty free outlets.
"Consumers planning to purchase duty free goods should shop around, including to sales tax free retailers. For example, camera shops and hi-fi shops offer specialist knowledge, a wide range of products and competitive sales tax free prices," Professor Fels said.