Freight & Trade Alliance (FTA) and the Australian Peak Shippers Association (APSA) wish to update members on the status of the Australian Competition and Consumer Commission's (ACCC) review into DP World Australia's (DPWA) proposed acquisition of Silk Logistics Holdings (Silk).
The ACCC has now announced it does not oppose the acquisition. In its final decision, the ACCC concluded "that the proposed acquisition would not likely result in a substantial lessening of competition."
This outcome follows a lengthy investigation, including the earlier delay of the original 5 June 2025 decision date while the ACCC sought further information from the merger parties under its Informal Merger Review Process Guidelines.
Read the full ACCC Media Release HERE.
Following is the ACCC's final Competition Analysis with insights into their reasoning for the decision:
Competition Analysis The ACCC concluded that the proposed acquisition was unlikely to substantially lessen competition in any market.
The ACCC's investigation focused on whether DP World Australia would likely have the ability and incentive to foreclose Silk's rival container transport providers by raising their rivals' costs or lowering the quality of their access to DP World Australia's terminals and whether such conduct was likely to substantially lessen competition in the supply of container transport services.
The ACCC found that while DP World Australia may have the ability to engage in some subtle forms of discrimination, such as providing Silk with priority access to booking slots or deprioritising access or service levels for Silk's rivals, DP World Australia's incentive to engage in discriminatory conduct is limited due to the impact of such conduct on terminal efficiency. A material reduction in terminal efficiency risks the profitability of the terminal and the loss of terminal volumes due to likely switching by shipping lines.
The ACCC found that to the extent DP World Australia is able to engage in discriminatory conduct that doesn't impact its primary function as a container terminal, such conduct is unlikely to substantially lessen competition, particularly because DP World Australia would remain competitively constrained by a range of established and prospective container transport providers.
The ACCC also considered whether, post-acquisition, DP World Australia could adopt an exclusionary bundling strategy by offering combined stevedoring and container transport services, through Silk, at below-cost prices, and whether the acquisition could give DP World Australia access to commercially sensitive information about rival transport providers in a way that would distort competition. The ACCC found that implementing such strategies would likely be commercially and operationally impractical for DP World Australia. While these forms of conduct could not be entirely ruled out, the ACCC considered that, to the extent they might occur, they were unlikely to result in a substantial lessening of competition in any market.
Read the full ACCC analysis on the Public informal merger reviews register HERE. |