ACCC proposes to allow collective negotiation of motor vehicle area hire charges at ports

The Australian Competition and Consumer Commission has issued a draft decision proposing to authorise* the Federal Chamber of Automotive Industries to collectively negotiate the terms and conditions of area hire charges with stevedoring companies on behalf of its members.

The services provided by the stevedores (area hire service providers) allow car exporters and importers to hold vehicles at the port prior to export or on import.

"Motor vehicle area hire service contracts are currently negotiated between stevedoring companies and shipping lines, with the shipping lines then passing the charge on to importers and exporters of motor vehicles as a component of their overall shipping fee", ACCC Chairman, Mr Graeme Samuel, said today. "The FCAI has argued that the lack of a direct contractual relationship between the stevedoring companies and its members creates inefficiencies that can be addressed through collective negotiations.

"The ACCC has assessed the FCAI's proposal and considers that any anti-competitive detriment that may flow from it is likely to be minimal.

"The ACCC sees benefits in allowing the FCAI to seek to negotiate with automotive stevedoring providers. The ACCC considers that, to the extent the proposed collective bargaining arrangements provide efficiencies through improving the input of FCAI members into contracts, the proposed arrangements would be likely to generate a public benefit".

The ACCC will consult on its draft decision before making a final decision. Parties wishing to make a submission to the ACCC on this issue should contact the ACCC for further details.

*The Trade Practices Act 1974 prohibits certain forms of anti-competitive agreements, including agreements between competitors that limit their ability to deal with whom they choose or on the terms they chose (including price). Authorisation provides immunity from court action under the Act arising from such agreements but can only be granted where the ACCC is satisfied that the public benefit flowing from the conduct outweighs any public detriment.