Flinders Ports offered the section 87B undertaking (undertaking), to avoid delay and address the ACCC’s concerns about the impact that the proposed joint venture may have on the supply of container stevedoring services at Port Adelaide, South Australia.
Post-transaction, Flinders Ports would have dual roles as container stevedore and port manager, and would be responsible for allocating the necessary inputs for container stevedoring at Port Adelaide to parties who are potentially also its competitors.
Broadly, the undertaking requires Flinders Ports to:
notify the ACCC of any allocations of certain relevant land at Port Adelaide, and licences for container stevedoring at Port Adelaide;
delay settlement of any allocations of land or container stevedoring licences notified to the ACCC pursuant to the undertaking, until the ACCC has concluded a review and confirmed the outcome to Flinders Ports; and
provide written reports to the ACCC concerning approaches made to Flinders Ports by interested third parties who have sought allocations of land or container stevedoring licences from Flinders Ports.
The undertaking adequately addresses competition concerns that the proposed joint venture would increase barriers to entry in the market for container stevedoring services at Port Adelaide.
It ensures that the process used by Flinders Ports to allocate the necessary inputs for container stevedoring is transparent, and subject to review by the ACCC in accordance with the Merger Review Process Guidelines 2006.
The notification process established by the undertaking also ensures that prospective new entrants are not deterred from seeking entry by the fact of the joint venture between Flinders Ports and DP World (SA) Pty Ltd, the incumbent stevedore.
A Public Competition Assessment will be issued on the Mergers Public Register in relation to the proposed acquisition.
