Woolies wins approval for modified epump scheme

Woolworths has won the approval of the Australian Competition and Consumer Commission to go ahead with its epump proposal, but only after modifying its plans to overcome the regulator's concern that it was anti-competitive.

The ACCC issued a notice yesterday saying it would not oppose the big retailer's plan to offer special payment arrangements at Caltex Woolworths' fuel outlets to users of its Woolworths Everyday Money Credit Card, on an exclusive basis.

In January the regulator had issued a notice opposing the move, saying it was concerned that the arrangement would distort the competitive process between card issuers.

Woolworths went back to the ACCC last week with a new exclusive dealing notification that sets a time limit on the scheme. The exclusive aspect of epump will expire in August next year.

Epump is a contactless payment system that will operate at the bowser at selected Caltex Woolworths and Caltex Safeway (Victoria only) outlets. The appeal for consumers is that they can have their petrol discounts calculated automatically and also avoid having to queue at a counter.

Woolworths said in its original notification that existing contactless payment technologies in use in Australia, MasterCard PayPass and Visa payWave, did not have the necessary functionality to make fuel purchases at its fuel outlets.

Since then it has adopted a more ecumenical approach. ACCC chairman Graeme Samuel said yesterday: "The ACCC has obtained a public commitment from Woolworths that it will negotiate in good faith with other contactless card issuers to enable their cards to be used at the pump.

"The ACCC expects that consumers will be able to use epump after that date (August 2010) if not sooner."