ACCC Responds to AWU Concerns

Date: 13 May 2004

The Australian Workers' Union has congratulated the ACCC on its decision to oppose the acquisition of Adelaide Brighton by Boral Limited.

The AWU has actively opposed the merger of the nation's two largest concrete manufacturers because it would result in a substantial lessening of competition in the industry and may be in breach of section 50 of the Trade Practices Act.

In its submission to the ACCC, the AWU argued that the merger would substantially lessen competition by increasing the level of concentration, vertical integration and barriers to entry in a number of markets.

Not only would the merger reduce competition in upstream cement markets, but would also hinder competition in downstream concrete markets. The AWU rejected suggestions by Boral that imports would act as an effective constraint on these markets because of the high transport costs and long lead times associated with importing cement into Australia.

AWU National Secretary Bill Shorten said that ensuring Adelaide Brighton remained an independent force in the cement industry was vital to prevent greater market concentration in fewer hands.

"The AWU is pleased to have been able to put its views to the ACCC and have those views accepted as reasonable and valid. Allowing the merger would have been unhealthy for the industry, and would have adversely impacted all Australians. If the merger were to proceed, prices for cement and concrete, and eventually the cost of construction work, would inevitably increase." Mr. Shorten said.

"Often companies ignore the views and interests of employees when planning mergers. It is therefore pleasing that the ACCC is eager to hear the views of employees and unions in relation to these matters. The AWU has employed this new tactic to stop the trend of market concentration into fewer hands. We have disagreed with previous decisions by the ACCC which have allowed market concentration in the heavy construction industry but in this case we give the ACCC's decision a tick. The AWU will continue to actively argue against market concentration so independent contractors, workers and consumers are not subject to exploitation. Companies are put on notice that they ignore employee stakeholders at their peril."

A copy of the AWU's orginal submission to the ACCC is avaliable by clicking here.

For further information

Contact:	Paul Howes
Union:	The Australian Workers' Union
Phone:	03 8327 0828
Email:	media@awu.net.au
WWW:	http://www.awu.net.au

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