Submitted by Frank Zumbo, Associate Professor, University of New South Wales.

The Caltex takeover of the Mobil retail sites would lead to less competition in the petrol industry and higher petrol prices for motorists.

Caltex and its joint venture partner - Woolworths - already have a dominant position in the retail market. Also, Caltex in its own right is already a dominant player in the wholesale market.

If Caltex was allowed to acquire the Mobil service stations that would give them and joint venture partner Woolworths, about 44% of the retail market. Such a commanding position in the retail market that motorists will end up paying much more for their petrol.

The ACCC has the power under s 50 of the Trade Practices Act to stop an acquisition that substantially lessens competition. Given that the Caltex acquisition of the Mobil sites would put a major dent in competition at the retail level, the ACCC and Petrol Commissioner have the power to stop Caltex from acquiring the Mobil sites.

In addition, given that many of the Mobil sites are high volume, strategic sites the Caltex acquisition would substantially lessen competition in local markets and lead to higher prices for motorists.

All the Mobil service stations should be sold to independents as that's the only way we can inject the much needed competition in the petrol industry.

The Petrol Commissioner needs to stop the Caltex acqusition of Mobil sites as that represents a clear and present danger to competition to the detriment of motorists.