ACCC issues draft decision on ARTC interstate rail access undertaking
The Australian Competition and Consumer Commission has issued a draft decision today regarding the Australian Rail Track Corporation's (ARTC) interstate access undertaking application.
The ACCC draft decision is to accept the interstate access undertaking subject to ARTC addressing a number of issues raised by the ACCC.
ARTC's access undertaking sets out the terms and conditions upon which it will negotiate access to the interstate railway network.
The ACCC has asked ARTC to address a number of price and non-price provisions proposed in the interstate access undertaking to ensure a balance of interests between the access provider (ARTC), access seekers and the public interest.
The ACCC is seeking submissions from interested parties on the draft decision before it issues a final decision. The ACCC has requested submissions by no later than 26 May 2008.
Australian Rail Track Corporation Ltd was established in 1998 to manage access to the standard gauge rail network (i.e. the below rail network) connecting the mainland capital cities between Brisbane and Perth. This management responsibility incorporates the planning, scheduling and transit of trains through the network and associated commercial arrangements with train operators (i.e. access arrangements). In September 2004, ARTC entered a 60-year lease over the interstate NSW rail tracks.
ARTC is a vertically separated infrastructure provider and does not operate trains.
On 20 December 2007, ARTC lodged an application with the ACCC to assess its revised Interstate Access Undertaking application (the December undertaking). The December undertaking is a revised version of an earlier undertaking application made by ARTC in June 2007 (the June undertaking) which was subsequently withdrawn by ARTC on 15 October 2007.
The December undertaking covers terms and conditions of access to standard gauge tracks along the interstate network, including the interstate rail track leased in NSW. However, the undertaking does not cover access to tracks in the Hunter Valley coal network. ARTC is expected to lodge a separate access undertaking for the Hunter Valley coal network with the ACCC some time during 2008.
Assessment of the undertaking
ARTC's Interstate Access Undertaking application was assessed against the criteria of s.44ZZA of Part IIIA of the Trade Practices Act 1974.
Issues raised by the ACCC
The draft decision outlines several recommendations that ARTC is required to address if the undertaking is to be accepted by the ACCC. The ACCC has recommended that ARTC:
make it clear, as an objective within the preamble, that a key objective of the undertaking is to facilitate access to the interstate network
provide further detail on the scope of the NSW leased network and include maps in the undertaking that delineate and clarify the coverage of the network covered by the undertaking
specify, in accordance with the Act, that the undertaking would take effect 21 days after its acceptance by the ACCC
incorporate provisions relating to the expiry of the undertaking, including the possible extension of the undertaking's term
include a provision requiring ARTC to undertake a review of the undertaking, in consultation with stakeholders, after five years
incorporate a provision that requires ARTC to provide written reasons to an applicant where ARTC decides to issue a notice of intent to end access negotiations
include a provision that requires ARTC to offer the indicative access agreement to access seekers seeking access to the indicative service during access negotiations
limit the scope for price escalations for indicative services so that price increases may only occur once in a 12-month period
incorporate provisions that specify circumstances when the excess network occupancy charge would not apply
remove the capacity reservation fee, and
incorporate provisions that provide for greater industry consultation concerning future additions to network capacity.
