ACCC proposes to allow collective negotiations by coal producers

6 March 2014

The Australian Competition and Consumer Commission has issued a draft decision proposing to grant authorisation to a group of Queensland coal producers, known as the RG Tanna Coal Export Terminal Producers (the applicants), to collectively negotiate with Gladstone Ports Corporation (GPC).

The applicants wish to negotiate collectively with GPC in relation to the terms and conditions of new coal handling and port services agreements at Gladstone Port in Queensland.

“The ACCC believes that the collective negotiations are likely to result in public benefits, such as reduced transactions costs and increased input into contracts,” ACCC Deputy Chair Dr Michael Schaper said.

“The collective negotiations are voluntary and there is no proposed boycott activity. The target also supports the collective negotiations. Therefore, the arrangement is likely to result in an overall public benefit,” Dr Schaper said.

The ACCC is proposing to grant authorisation for the 15 years requested in line with the term of the proposed agreements. The ACCC considers that a longer period is appropriate in this case in order to provide the parties with commercial certainty, given the current development of the Port.

On 6 February 2014, the ACCC granted interim authorisation to allow the applicants to immediately commence collective negotiations with GPC while the ACCC assessed the substantive application for authorisation.

The ACCC has varied the existing interim authorisation to allow the applicants to collectively negotiate with GPC and enter into agreements, provided that the applicants do not give effect to any such agreement unless and until final authorisation is granted by the ACCC.

This interim authorisation commences immediately and will remain in place until the date that the ACCC's final determination comes into effect or is revoked.

The ACCC is seeking submissions from interested parties in relation to its draft determination before making a final decision.

The RG Tanna Coal Export Terminal Producers are Anglo American Australia Limited, BHP Billiton Mitsubishi Alliance, Cockatoo Coal Limited, Glencore Coal Investments Australia Pty Limited, Idemitsu Australia Resources Pty Ltd, Jellinbah Resources Pty Ltd, Rio Tinto Coal Australia Pty Ltd, Sojitz Coal Mining Pty Ltd, Wesfarmers Resources Ltd and Yancoal Australia Ltd.

Authorisation provides statutory protection from court action for conduct that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act 2010. Broadly, the ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.

Further information on the draft determination is available at http://registers.accc.gov.au/content/index.phtml/itemId/1130676/fromItemId/278039/display/acccDecision

Release number: 
MR 042/14
Media enquiries: 
Media team - 1300 138 917

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