The Australian Competition and Consumer Commission has approved two proposed agreements, between East Australian Pipeline Limited (EAPL) and AGL Wholesale Gas Limited (AGL Wholesale), for the transportation of natural gas.
"The ACCC concluded that neither contract was likely to have the effect of substantially lessening, preventing or hindering competition," ACCC Chairman, Professor Allan Fels, said today. "Under s.139 of the Moomba-Sydney Pipeline System Sale Act 1994 (MSPSS Act), the ACCC is required to either approve or refuse to approve any agreement between a Moomba operator (EAPL) and a controlling distributor or a related body corporate (AGL Wholesale).
"The Act requires the ACCC not to refuse approval unless it 'thinks the agreement would be likely to have the effect of substantially lessening, preventing or hindering competition'."
On 10 March 1997, the ACCC received from East Australian Pipeline Marketing Pty Limited (EAPM) notice under s.139 of the MSPSS Act of two proposed agreements, between EAPL and AGL Wholesale for the transportation of gas. The Australian Gas Light Company fully owns AGL Wholesale and has a majority interest (51 per cent) in EAPL.
At the same time, the ACCC also received copies of five 'generic' contracts, and the associated General Terms and Conditions (GT&C), which EAPM proposes will form the substance of all future contracts between EAPL and all other parties. The five contracts cover five types of agreements: Firm Transport, Spot Sales, Interruptible Low Priority, Interruptible High Priority, and Small Takeoff Points. EAPM requested the ACCC's opinion on these documents. There is no provision in the MSPSS Act for the ACCC to consider contracts or contract forms in general. Consequently, the ACCC decided not to express an opinion on any of the generic contracts or the General Terms and Conditions.
The two agreements approved by the ACCC are based on two of these generic agreements. "The ACCC stresses that its approval of these two agreements should in no way be taken as general approval of the 'generic' contracts on which they have been based," Professor Fels said.
