In small containerized hauling service, achieving comparable operating efficiency requires achieving route density comparable to existing firms, which typically takes a substantial period of time. Entry to this market is not easy because of the use of price discrimination and long-term contracts prevent new entrants from winning a large enough base of customers from incumbents to achieve efficient routes in a short time period or at pre entry prices. Solid waste hauling is an industry highly susceptible to tacit or overt collusion among competing firms. Overt collusion has been documented in more than a dozen criminal and civil antitrust cases brought in the last decade and a half. Such collusion typically involves customer allocation and price fixing, and, where it has occurred, has been shown to persist for many years.
Landfills are fewer in number than hauling companies.
Entry is difficult and time consuming to this product market because of the high capital costs required, the problem in finding sites available, and the approval needed from governmental authorities. If there is not adequate competition among landfill operators in a geographic market, the hauling companies can be subjected to higher disposal prices. Independent hauling companies are at a competitive disadvantage that do not own a landfill but must compete against integrated companies such as Page 9 USA Waste and Sanifill, which have both hauling operations and landfills. The elimination of one of a small number of significant competitors, such as would occur as a result of the proposed transaction in the alleged markets, significantly increases the likelihood that consumers in these markets are likely to face higher prices and poorer quality service. USA Waste and Sanifill have agreed to a Plan of Merger dated June 22, 1996.