ACCC outlines views on Transurban’s interest in WestConnex

The Australian Competition and Consumer Commission (ACCC) has raised preliminary competition concerns about Sydney Transport Partners, a consortium led by Transurban, and its proposed acquisition of a majority interest in the WestConnex project.The Australian Competition and Consumer Commission (ACCC) has raised preliminary competition concerns about Sydney Transport Partners, a consortium led by Transurban, and its proposed acquisition of a majority interest in the WestConnex project.

Transurban reportedly controls 15 of 19 toll road concessions in Australia, and seven of the 9 existing concessions in New South Wales.

“WestConnex is a very significant toll road asset, and as such represents an opportunity to establish a strong rival toll road operator,” said ACCC Chairman Rod Sims.

“We consider that Transurban already has significant incumbency advantages when competing for future toll road projects.

“It has access to highly detailed traffic data when bidding for new roads and is able to leverage its existing toll roads to offer unique unsolicited proposals to state governments.

“Transurban has been awarded five toll road concessions or upgrades following unsolicited proposals to state governments, in exchange for increases or extensions of existing tolls. It is the only operator in the past 30 years who has been granted a toll road concession in Australia following an unsolicited proposal to a state government.

“We are concerned that the proposed acquisition may cement Transurban’s advantages when competing for future toll roads,” he said.

The ACCC is assessing Sydney Transport Partners’ proposal against the likely alternative scenario if it did not proceed.

“If WestConnex is acquired by an alternative bidder, there would be two major toll road operators in Sydney,” said Sims. “Those two players would likely compete strongly for future toll road projects and vie for government approval for unsolicited road proposals.”

The ACCC is also concerned about the effects of the proposed acquisition on competition between toll roads.

“We are examining whether motorists in Sydney could switch between existing Transurban toll roads and WestConnex roads for certain trips,” said Sims.

“If there is potential competition between WestConnex and Transurban’s existing toll roads, motorists might lose the benefits from that competition if the acquisition goes ahead.

“For example, an alternative owner of WestConnex might lower tolls for certain trips, or make changes to its roads or services to ease traffic congestion in attempts to attract more vehicles away from Transurban roads,” he said.


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