The Commerce Commission today declined to clear Wilson Parking New Zealand (1992) Ltd to acquire four Wellington City Council parking businesses.
Commission Deputy Chairman Peter Allport said that the Commission was not satisfied that the proposal would not result in dominance being acquired in the market for long stay casual parking in the Wellington business and commercial area.
If the proposal were to go ahead, then Wilson's would have at least 70 percent of this market, with Condren's and coupon parking being the only significant existing competition.
Added to this is the difficulty of providing new parking facilities in the area. The City Council and the Wellington Regional Council transport strategies aim to cap the number of commuters bringing cars into the city by restricting the growth of parking.
The application was to acquire freehold ownership of the James Smith's carpark, the Lombard parking building and the Marion Street carpark, and the 10 year management rights for the Clifton Terrace carpark.
The Commission determined that there were two relevant markets, those for short stay and long stay casual parking in the areas described in the proposed Wellington District Plan as the inner and outer central city.
The Commission was satisfied that if the proposal were to go ahead, Wilson's would not acquire a dominant position in the short stay market only. It would have less than 50 percent of the short stay market, with metered parks being the main competition.
However, Wilson's position would be significantly stronger in the long stay market.
"The small extent of existing competition and the limited threat of new competition would not be enough to provide an effective or potential competitive constraint on Wilson's in the long stay market," Mr Allport said.
The Commerce Act prohibits business acquisitions that result in dominance being acquired or strengthened in any markets. The Commission will grant a clearance if it is satisfied that dominance is not acquired or strengthened.
