The Joint Distribution Centers in Canister Gas Industry and Fair Trade Law

Abstract

Appearance of the joint distribution centers for canister gases results from the changing conditions in the LPG market. When the corporate organizations are adjusted, not only can the economy of scale in labor utilization be achieved, but also the overall spending is reduced by decreasing the number of business branches. This development is good for our society. However, gas prices may be higher due to the operation of the joint distribution centers. After employing the survey data provided by the Fair Trade Commission to conduct analyses, we find that the prices charged by distribution-center-type gas corporations do not differ significantly from those charged by independent gas corporations.

From the regulating point of the Antitrust Law, the establishment and operations of the joint distribution centers for canister LPG should be relevant to the combination and collusion behavior. Concerning to the geographical territory of the market, both suggestions given by academic theories and actual country-and-town units should be considered. After taking factors of demand and supply into account, the LPG market should exclude the natural gas product. Moreover, the Energy Commission, Ministry of Economic Affairs, not the Fair Trade Commission, should be responsible for most problems faced by the joint distribution centers for canister gases.