ACCC calls for comment on proposed acquisition of iiNet by TPG

Anthony Caruana
15 June, 2015
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The Australian Competition and Consumer Commission has released a Statement of Issues outlining the ACCC’s preliminary views on the proposed acquisition of iiNet by TPG.

The ACCC needs more information so that it can determine whether the proposed acquisition would reduce competition for the supply of retail fixed broadband services in the market.

ACCC chairman Rod Sims says, “The proposed acquisition would combine two of the five largest suppliers of fixed broadband in Australia. The ACCC is exploring the extent to which the acquisition of iiNet will reduce competition by reducing the likely competitive tensions in respect of pricing, innovation and service quality.”

Consumers have made a number of submissions to the ACCC, voicing concerns that primarily iiNet’s customer service levels will be compromised by the acquisition.

Over recent years, TPG has not fared well in ombudsman’s reports regarding its services.

The ACCC also has questions regarding the reduction in the number of market participants and whether this will have an impact on customers seeking the supply of fixed broadband services. As a general proposition, competition is stronger when the market contains more competitors, according to the ACCC.

The ACCC has formed a preliminary view that the proposed acquisition is unlikely to raise competition concerns in other markets, including the supply of wholesale transmission, or backhaul, mobile broadband and voice services.

The Statement of Issues is not a final decision. It provides the ACCC’s preliminary views on the proposed acquisition and the lines of further inquiry that the ACCC wishes to undertake.

Interested parties can make submissions to the ACCC’s Statement of Issues by 2 July 2015. The ACCC’s final decision has been deferred until 20 August 2015.

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