[Federal Register Volume 82, Number 231 (Monday, December 4, 2017)]
[Notices]
[Pages 57265-57267]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-26012]


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FEDERAL TRADE COMMISSION

[File No. 171 0207]


Alimentation Couche-Tard Inc. and CrossAmerica Partners LP; 
Analysis To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair methods of competition. 
The attached Analysis to Aid Public Comment describes both the 
allegations in the complaint and the terms of the consent orders--
embodied in the consent agreement--that would settle these allegations.

DATES: Comments must be received on or before December 22, 2017.

ADDRESSES: Interested parties may file a comment online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write: ``In the Matter of ACT/
Jet Pep, Inc., File No. 171 0207'' on your comment, and file your 
comment online at https://ftcpublic.commentworks.com/ftc/actconsent by 
following the instructions on the web-based form. If you prefer to file 
your comment on paper, write ``In the Matter of ACT/Jet Pep, Inc., File 
No. 171 0207'' on your comment and on the envelope, and mail your 
comment to the following address: Federal Trade Commission, Office of 
the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 (Annex D), 
Washington, DC 20580, or deliver your comment to the following address: 
Federal Trade Commission, Office of the Secretary, Constitution Center, 
400 7th Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC 
20024.

FOR FURTHER INFORMATION CONTACT: Kara Todd, (202-326-2015), Bureau of 
Competition, 600 Pennsylvania Avenue NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned

[[Page 57266]]

consent agreement containing a consent order to cease and desist, 
having been filed with and accepted, subject to final approval, by the 
Commission, has been placed on the public record for a period of thirty 
(30) days. The following Analysis to Aid Public Comment describes the 
terms of the consent agreement, and the allegations in the complaint. 
An electronic copy of the full text of the consent agreement package 
can be obtained from the FTC Home Page (for November 22, 2017), on the 
World Wide Web, at https://www.ftc.gov/news-events/commission-actions.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before December 22, 
2017. Write ``In the Matter of ACT/Jet Pep, Inc., File No. 171 0207'' 
on your comment. Your comment--including your name and your state--will 
be placed on the public record of this proceeding, including, to the 
extent practicable, on the public Commission Web site, at https://www.ftc.gov/policy/public-comments.
    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comments online. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/actconsent by following the instructions on the web-based form. If 
this Notice appears at http://www.regulations.gov/#!home, you also may 
file a comment through that Web site.
    If you prefer to file your comment on paper, write ``In the Matter 
of ACT/Jet Pep, Inc., File No. 171 0207'' on your comment and on the 
envelope, and mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite 
CC-5610 (Annex D), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex 
D), Washington, DC 20024. If possible, submit your paper comment to the 
Commission by courier or overnight service.
    Because your comment will be placed on the publicly accessible FTC 
Web site at https://www.ftc.gov, you are solely responsible for making 
sure that your comment does not include any sensitive or confidential 
information. In particular, your comment should not include any 
sensitive personal information, such as your or anyone else's Social 
Security number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. You are also 
solely responsible for making sure that your comment does not include 
any sensitive health information, such as medical records or other 
individually identifiable health information. In addition, your comment 
should not include any ``trade secret or any commercial or financial 
information which . . . is privileged or confidential''--as provided by 
Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 
16 CFR 4.10(a)(2)--including in particular competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies the 
comment must include the factual and legal basis for the request, and 
must identify the specific portions of the comment to be withheld from 
the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted on the public FTC Web site--as legally required by FTC Rule 
4.9(b)--we cannot redact or remove your comment from the FTC Web site, 
unless you submit a confidentiality request that meets the requirements 
for such treatment under FTC Rule 4.9(c), and the General Counsel 
grants that request.
    Visit the FTC Web site at http://www.ftc.gov to read this Notice 
and the news release describing it. The FTC Act and other laws that the 
Commission administers permit the collection of public comments to 
consider and use in this proceeding, as appropriate. The Commission 
will consider all timely and responsive public comments that it 
receives on or before December 22, 2017. For information on the 
Commission's privacy policy, including routine uses permitted by the 
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Analysis of Agreement Containing Consent Orders To Aid Public Comment

I. Introduction

    The Federal Trade Commission (``Commission'') has accepted for 
public comment, subject to final approval, an Agreement Containing 
Consent Orders (``Consent Agreement'') from Alimentation Couche-Tard 
Inc. (``ACT'') and CrossAmerica Partners LP (``CAPL'') (collectively, 
the ``Respondents''). The Consent Agreement is designed to remedy the 
anticompetitive effects that likely would result from the proposed 
acquisition of Jet-Pep, Inc. (``Jet-Pep'') assets.
    Under the terms of the proposed Consent Agreement, ACT and CAPL 
must divest to a Commission-approved buyer (or buyers) certain Jet-Pep 
retail fuel outlets and related assets in three local markets in 
Alabama. ACT must complete the divestiture no later than 120 days after 
the closing of ACT's acquisition of Jet-Pep. The Commission and 
Respondents have agreed to an Order to Maintain Assets that requires 
Respondents to operate and maintain each divestiture outlet in the 
normal course of business until a Commission-approved buyer acquires 
the outlet.
    The Commission has placed the proposed Consent Agreement on the 
public record for 30 days to solicit comments from interested persons. 
Comments received during this period will become part of the public 
record. After 30 days, the Commission will again review the proposed 
Consent Agreement and the comments received, and will decide whether it 
should withdraw from the Consent Agreement, modify it, or make it 
final.

II. The Respondents

    Respondent ACT, a publicly traded company headquartered in Laval, 
Quebec, Canada, operates convenience stores and retail fuel outlets 
throughout the United States and the world. ACT is the parent of wholly 
owned subsidiary, Circle K Stores Inc. (``Circle K''). ACT's current 
U.S. network consists of approximately 7,200 stores located in 42 
states, making ACT the second-largest retail fuel chain in the country. 
ACT convenience store locations operate primarily under the Circle K 
and Kangaroo Express banners, while its retail fuel outlets provide a 
variety of company unbranded and third-party branded fuels. ACT owns 
158 retail fuel outlets in Alabama.
    Respondent CAPL, a publicly traded master limited partnership 
headquartered in Allentown, Pennsylvania, markets fuel at wholesale, 
and owns and operates convenience stores and retail fuel outlets. ACT, 
via Circle K, acquired CST Brands, Inc. (``CST'') in June 2017, which 
gave Circle K operational control and management of CAPL. CAPL supplies 
fuel to nearly 1,200 sites across 29 states, but it does not operate in 
Alabama.

[[Page 57267]]

III. The Proposed Acquisition

    Through three separate agreements (collectively ``the 
Acquisition''), ACT will acquire ownership or operation of 120 Jet-Pep 
retail fuel outlets with attached convenience stores. Circle K intends 
to acquire 18 retail fuel outlets and Jet-Pep's terminal and related 
assets. CAPL will acquire the remaining 102 Jet-Pep retail fuel 
outlets. The Acquisition is not reportable under the Hart-Scott-Rodino 
Antitrust Improvements Act of 1976, 15 U.S.C. 18a (``HSR Act''). The 
Acquisition would extend ACT's position as one of the largest operators 
of retail fuel outlets in the United States.
    The proposed Complaint alleges that the Acquisition, if 
consummated, would violate Section 7 of the Clayton Act, as amended, 15 
U.S.C. 18, and Section 5 of the Federal Trade Commission Act, as 
amended, 15 U.S.C. 45, by substantially lessening competition for the 
retail sale of gasoline and diesel in three local markets in Alabama. 
The proposed Complaint further alleges that Acquisition agreements 
constitute a violation of Section 5 of the FTC Act, as amended, 15 
U.S.C. 45.

IV. The Complaint

    As alleged in the proposed Complaint, the relevant product markets 
in which to analyze the Acquisition are the retail sale of gasoline and 
the retail sale of diesel. The retail sale of gasoline and the retail 
sale of diesel constitute separate relevant markets because the two are 
not interchangeable. Consumers require gasoline for their gasoline-
powered vehicles and can purchase gasoline only at retail fuel outlets. 
Likewise, consumers require diesel for their diesel-powered vehicles 
and can purchase diesel only at retail fuel outlets.
    The proposed Complaint alleges the relevant geographic markets in 
which to assess the competitive effects of the Acquisition are three 
local areas in Brewton, Monroeville, and Valley, Alabama. Each 
particular geographic market is unique, with factors such as commuting 
patterns, traffic flows, and outlet characteristics playing important 
roles in determining the scope of the geographic market. Retail fuel 
markets are highly localized and can range in size up to a few miles.
    According to the proposed Complaint, the Acquisition would reduce 
the number of independent market participants in each market to three 
or fewer. The Acquisition would thereby substantially lessen 
competition in these local markets by increasing the likelihood that 
ACT will unilaterally exercise market power and by increasing the 
likelihood of successful coordination among the remaining firms. Absent 
relief, the Acquisition would likely result in higher prices in each of 
the three local markets.
    The proposed Complaint alleges that entry into each relevant market 
would not be timely, likely, or sufficient to deter or counteract the 
anticompetitive effects arising from the Acquisition. Barriers to entry 
include the availability of attractive real estate, the time and cost 
associated with constructing a new retail fuel outlet, and the time 
associated with obtaining necessary permits and approvals.

V. The Consent Agreement

    The proposed Consent Agreement would remedy the Acquisition's 
likely anticompetitive effects by requiring ACT to divest certain Jet-
Pep retail fuel outlets and related assets in three local markets.
    The proposed Consent Agreement requires that the divestiture occur 
no later than 120 days after ACT consummates the Acquisition. This 
Agreement protects the Commission's ability to obtain complete and 
effective relief in light of the non-reportable nature of the 
Acquisition and the small number of outlets to be divested. Further, 
based on Commission staff's investigation, the Commission believes that 
ACT can identify an acceptable buyer (or buyers) within 120 days.
    The proposed Consent Agreement further requires ACT to maintain the 
economic viability, marketability, and competitiveness of each 
divestiture asset until the Commission approves a buyer (or buyers) and 
the divestiture is complete. For up to twelve months following the 
divestiture, ACT must make available transitional services, as needed, 
to assist the buyer of each divestiture asset.
    In addition to requiring outlet divestitures, the proposed Consent 
Agreement also requires ACT to provide the Commission notice before 
acquiring designated outlets in the three local areas for ten years. 
The prior notice provision is necessary because acquisitions of the 
designated outlets likely raise competitive concerns and may fall below 
the HSR Act premerger notification thresholds.
    The proposed Consent Agreement contains additional provisions 
designed to ensure the effectiveness of the proposed relief. For 
example, Respondents have agreed to an Order to Maintain Assets that 
will issue at the time the proposed Consent Agreement is accepted for 
public comment. The Order to Maintain Assets requires Respondents to 
operate and maintain each divestiture outlet in the normal course of 
business, through the date the Respondents' complete divestiture of the 
outlet. During this period, and until such time as the buyer (or 
buyers) no longer requires transitional assistance, the Order to 
Maintain Assets authorizes the Commission to appoint an independent 
third party as a Monitor to oversee the Respondents' compliance with 
the requirements of the proposed Consent Agreement.
    The purpose of this analysis is to facilitate public comment on the 
proposed Consent agreement, and the Commission does not intend this 
analysis to constitute an official interpretation of the proposed 
Consent Agreement or to modify its terms in any way.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2017-26012 Filed 12-1-17; 8:45 am]
BILLING CODE 6750-01-P