ACCC authorises collective procurement of organics waste services by Gippsland councils

The ACCC has granted authorisation to enable Gippsland Waste and Resource Recovery and a group of six Councils in Gippsland, Victoria (the Applicants) to jointly procure organic waste processing services until 1 July 2042. The six Gippsland Councils covered by the authorisation are: Bass Coast Shire Council, Baw Baw Shire Council, East Gippsland Shire Council, Latrobe City Council, South Gippsland Shire Council and Wellington Shire Council.

The ACCC considers the joint tendering is likely to result in public benefits in the form of transaction costs savings, increased efficiencies, environmental benefits and increased competition for the supply of organic waste processing services to the councils.

Each council will independently decide which supply option, either from the options available through the joint tender process, or through separately contracting with a supplier, best suits their needs. Accordingly, all potential suppliers, whether or not they are capable of supplying all six councils, will continue to have opportunities to compete to supply the councils. This approach is likely to stimulate greater competition for the proposed contracts, by leading to more tender participants than would otherwise be the case and by incentivising potential tenderers (both existing and new entrants) to compete more vigorously to supply the councils. Taking into account the above factors, the ACCC considers that the joint tendering conduct is likely to result in limited public detriment.

The ACCC also granted the Applicants' request for an amendment to the interim authorisation previously granted on 25 February 2021. As the ACCC has now made a final decision authorising the Applicants' proposed conduct, the ACCC has varied the interim authorisation so it is on the same terms as the substantive authorisation that the ACCC has granted. This will allow the Applicants to progress the tender process in the manner they have requested until the substantive authorisation comes into force on 17 April 2021.

Further details about the authorisation are available on the ACCC public register at: Gippsland Waste and Resource Recovery Group & Ors

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