The Australian Competition and Consumer Commission has made final determinations exempting GrainCorp and Quattro from having to comply with Parts 3 to 6 of the Port Terminal Access (Bulk Wheat) Code of Conduct in relation to facilities at Port Kembla.
The ACCC indicated its intention to exempt the facilities once Quattro’s facility became capable of handling bulk wheat in a final position paper released in October 2015.
“The ACCC’s assessment was that there will likely be a significant amount of spare capacity across GrainCorp and Quattro’s facilities at Port Kembla. This will mean that both parties will have strong commercial incentives to compete to attract customers to use their services,” ACCC Commissioner Cristina Cifuentes said.
In March 2016, Quattro advised the ACCC that it was planning to load its first bulk wheat export vessel by the end of the month.
“The ACCC considers that it is now the appropriate time to exempt the GrainCorp and Quattro facilities given that Quattro’s facility is complete,” Ms Cifuentes said.
“The level of competition between GrainCorp and Quattro for bulk export customers at Port Kembla makes these exemptions appropriate.”
The final determinations note that the ACCC intends to monitor the level of competition at Port Kembla in the future.
“The ACCC will continue to monitor bulk wheat exports at Port Kembla. Both GrainCorp and Quattro are still required to provide information on their shipping activities at Port Kembla under Part 2 of the code. This information will allow the ACCC to monitor things like export volumes and market concentration,” Ms Cifuentes said.
Information about the ACCC’s Port Kembla exemption assessment process, including the ACCC’s draft decisions and final position documents, are available at: Port Kembla wheat ports exemption assessments
Background
The code, which commenced on 30 September 2014, regulates bulk wheat port terminal service providers to ensure that exporters have fair and transparent access to terminal facilities. Where appropriate, the ACCC may reduce regulation at a specific port terminal by exempting the relevant port terminal service provider from certain provisions of the code.
As a result of the exemptions, Quattro and GrainCorp will not be subject to a number of the code’s provisions at their respective Port Kembla facilities. These include obligations to provide non-discriminatory access, resolve access disputes through prescribed processes, obtain ACCC approval for capacity allocation systems, and publish certain information.
Exempt service providers are still obliged to deal with exporters in good faith and publish information including standard terms of access to their port terminal services, reference prices for those services, and the current state of their shipping stem. Exempt service providers must also comply with general competition law.