Complaint to CMA that incinerator contract is illegal

Community Benefit Society R4C have lodged a complaint with the Competition and Markets Authority (CMA) that the contract for a Stroud incinerator is in breach of competition rules.

As highlighted previously, R4C was set up following a long campaign against proposals for the Javelin Park incinerator, finally given permission by Gloucestershire County Council (GCC) in 2015.

When the planning appeal and the legal challenge were lost local objectors decided to take a different tack and R4C proposed its own alternative, commercially sustainable recovery and recycling plant. The contract, originally signed in 2013 and then renegotiated in 2015, for the £500 million incinerator was awarded to Urbaser Balfour Beatty although details on pricing and information on termination were only made public following an Information Tribunal ruling in March this year (2017).

In light of this information, and after seeking assistance from Counsel through ELF member, Duncan Sinclair of 39 Essex Chambers, R4C lodged a complaint with the CMA on 21st March that the Javelin Park contract breaches the Competition Act 1998.

R4C believe that the exclusive contract is anti-competitive and prevents technological innovation, imposing a huge financial burden for years to come. They state that:

• the price paid by GCC for waste disposal for a minimum amount is 10 times the next tranche, thereby creating ‘de facto’ exclusivity and foreclosing the market for waste treatment (including eliminating incentives to recycle/move higher up the waste hierarchy);

• there are excessive termination costs thereby enforcing the ‘lock-in’; and

• the 25-year contract prevents newer, cheaper and more efficient/environmentally friendly alternatives developing to the detriment of consumers in terms of not only price but also their interest in the environment (both local and more broadly).

On 31st March R4C published independent analysis of the Javelin Park contract at an event at the Guildhall, where the actor Jeremy Irons spoke in support of the report.

If the complaint is upheld the contract could be declared void and GCC would face financial penalties.