| Calls for waste market to be regulated |
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| Wednesday, 03 September 2008 | |
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There have been calls for the regulation of the waste market after reports that private operator Greenstar is considering a takeover of its biggest rival Panda, which operates in South Dublin. It was reported recently in a national newspaper that waste management company Greenstar is in advanced negotiations to buy either all or part of County Meath-based Panda. It is understood Greenstar, which is owned by NTR, the energy and utilities group, is conducting due diligence – an investigation into the performance of a company – on Panda. A deal would reinforce Greenstar's position as Ireland's largest waste management group. It is estimated that Panda could cost about e65 million if a deal is concluded to sell the entire business to Greenstar. However, Greenstar is likely to face scrutiny from the Competition Authority if it decides to buy Panda. Under Competition Authority rules, all deals involving companies with a turnover of more than e40 million are notifiable to the authority. The State body can investigate whether a deal will lead to a substantial lessening of competition in a sector. “Panda is exploring a number of options with regard to the long-term future of the organisation,” a spokesman told Southside People. When asked to confirm that they were in talks with Panda about a potential takeover, a spokesman for Greenstar said it was not company policy to comment. Panda has progressively captured the bulk of the private door-to-door bin collection services in Dún Laoghaire Rathdown by cutting prices to attract customers. Blackrock based Progressive Democrats activist Victor Boyhan noted that if the deal went ahead, Greenstar would control most of the private collection service in Dún Laoghaire Rathdown. He said a waste monopoly situation would not be in the best interests of customers and he called for regulation of the sector, which he said was “long overdue”. “I believe competition is good for customers,” he said. “It forces councils and private suppliers of the service to keep control of costs and fair pricing. Surely that's to be encouraged.” Dublin City Council failed to obtain a High Court injunction against Panda last month to prevent the firm from expanding into the council's administrative area. The council had sought the injunction to apply until the outcome of a legal action by Panda challenging the council's proposed new waste collection regime "Councils should not be allowed to frustrate open competition from the private sector,” Mr Boyhan added. He argued that rather than resisting new entrants into the market councils should encourage their arrival and interest in providing such an important service, subject to regulation and standards. He also called for the establishment of a waste management regulator to “oversee fair competition, fair pricing, environmental issues, health and safety standards, and to deal with issue of disputes between the various waste collection service providers”. A spokesman for the Department of the Environment said: “While there is general agreement that the existing regulatory framework needs modernisation, there is no consensus on what form this should take, such as whether a waste regulator is required or whether it would be sufficient to change the regulatory framework to provide for a form of public service obligation. “A key overarching issue that has emerged is the dual role of local authorities as competitors and regulators in the same market and the perceived conflict of interest arising from this.” In addition, the spokesman said the Programme for Government contained a range of commitments in respect of waste management policy that included a commitment to undertake an international review of waste management plans, practices and procedures and to act on its conclusions. “The international review of waste management should contribute to the development of an effective policy on regulation and deliver an efficient market with least cost solutions,” he added. |
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