CC clears fuel distribution merger
4 Sep 2012
The Competition Commission (CC) has formally cleared DCC Energy UK Limited’s completed acquisition of heating and transport fuel distribution businesses previously owned by Total Downstream UK plc.
This confirms the CC’s provisional findings, which were published in July.
DCC, which operates GB Oils, bought these businesses in September 2011 from Rontec LLP Limited, which had previously bought them from Total in June 2011. The acquisition included the Butler Fuels oil distribution business (which sells and distributes heating and transport fuels to domestic and business customers) and the contractual right to supply transport fuels to a number of dealer-owned, dealer-operated retail service stations currently under the Total brand. Distribution businesses generally deliver to customers that require smaller delivery volumes than customers of oil majors and traders (that mainly deliver in large, articulated tankers).
The CC has found that the range of customers supplied by these businesses will not suffer from a substantial lessening of competition as a result of the acquisition:
- Customers with large load requirements, such as service stations, will continue to have a range of supply options.
- Local customers with smaller requirements will face a reduction in choice in some areas but the ease of small-scale entry for other companies would counteract this.
- Customers requiring smaller loads across a number of sites (multi-site non-bulk) can and already do source from a number of suppliers and most are prepared to switch in response to price rises.
The final report is available on the DCC/Rontec inquiry home page along with all other information relating to the investigation.
Notes for editors
1. The members of the DCC/Rontec Inquiry Group are: Simon Polito (Chairman of the Inquiry Group and CC Deputy Chairman), John Cubbin, Ivar Grey and Peter Jones.
2. The CC is an independent public body, which carries out investigations into mergers, markets and the regulated industries.
3. The Enterprise Act 2002 empowers the OFT to refer to the CC completed or proposed mergers for investigation and report which create or enhance a 25 per cent share of supply in the UK (or a substantial part thereof) or where the UK turnover associated with the enterprise being acquired is over £70 million.
4. The CC has a 24-week period in which it is required to publish its report, which may be extended by no more than eight weeks if it considers that there are special reasons why the report cannot be published within that period.
5. Further information on this inquiry, including the terms of reference and other key documents, as well as on the CC and its procedures, including its policy on the provision of information and the disclosure of evidence, can be obtained from the CC website at: www.competition-commission.org.uk.
6. Enquiries should be directed to Rory Taylor or Siobhan Allen or by ringing 020 7271 0242.
