German anti-trust authority probes alleged fuel cartel | Business| Economy and finance news from a German perspective | DW | 04.04.2012
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German anti-trust authority probes alleged fuel cartel

Germany's 'big five' fuel station groups are under investigation for alleged price-fixing, the Federal Cartel Office has said. The 'oligopoly' stands accused of abusing its dominant market position.

German anti-trust regulators announced on Wednesday that the country's five major gas station operators, BP/Aral, Esso, Jet, Shell and Total, were under investigation.

The Federal Cartel Office said in a statement that the quintet were under investigation for selling car fuels "below their purchasing prices" at a number of gas stations in efforts to "drive independent filling stations out of business."

In addition, they were alleged to have charged independent operators higher prices for wholesale fuels than those paid by operators of their own stations.

"The investigation will help strengthen competition from independent service stations against the oligopoly created by the 'big five'," Cartel Office President Andreas Mundt told the daily "Frankfurter Allgemeine Zeitung."

Mundt added that regulators were taking these accusations seriously, and were looking into all evidence available.

Price swings move onto political agenda

Apart from the anti-trust investigation, the German government is working on legislation that would impact the price policies of the country's major fuel groups, doing away with unpredictable price swings at the pumps.

Hoping to pass a bill before parliament's summer break, the government is considering a number of schemes that would aim to ban companies from raising fuel prices at random and several times a day.

A model used in western Australia, where fuel providers have to fix and announce the price a day before it comes into effect, has come under scrutiny. That system is designed so that consumers have at least a day's warning, and can pick the most cost-effective moment to fill up their cars.

In addition, lawmakers are also discussing a policy practiced in neighboring Austria, where fuel companies are allowed to raise prices only once per day.

Cartel Office President Andreas Mundt said he preferred a model that would give independent filling stations greater flexibility on their pricing compared to stations run by the big five.

"I could envisage the western Australian scheme being applied only to the five oligopoly members, while independent stations continued to have total pricing freedom," he said.

uhe/msh (AFP, dpa)