The Australian Competition and Consumer Commission is seeking views on whether to reduce regulation at Victorian wheat port terminals under the new mandatory code on bulk wheat terminal access.
The code commenced on 30 September 2014 replacing the previous access undertakings regime administered by the ACCC. The code regulates bulk wheat port terminal operators to ensure that exporters have fair and transparent access to terminal facilities.
The code allows for regulation to be reduced at ports where appropriate. The ACCC may exempt a port terminal service provider from certain provisions of the code in relation to a specific port terminal facility.
The ACCC is now assessing exemption applications for port facilities located in Victoria where the code currently applies to established facilities which are controlled by different operators. The ACCC will conduct these assessments at the same time as the facilities are located in similar geographic regions and may compete with each other.
“The ACCC is seeking views on a range of factors including the relevant markets for consideration, the extent of competition in services across the supply chain, and the likely impact on third party exporters,” ACCC Commissioner Cristina Cifuentes said.
The ports under assessment are:
- GrainCorp’s bulk wheat port terminals at Geelong and Portland; and
- The Emerald bulk wheat terminal at the Port of Melbourne.
GrainCorp and Emerald have lodged exemption applications for their respective ports.
In their applications, the port operators submit that their Victorian terminals compete against each other and that this limits their ability to exercise market power. The operators also argue that the ports have excess export capacity and that their ability to exercise market power is limited by the domestic market, container exports, and prospective port developments.
The ACCC will assess the level of competition faced by each facility and make its determination against the relevant matters set out in the code.
If the ACCC grants an exemption, an exempt service provider will not be subject to a number of code provisions, including a non-discrimination requirement, dispute resolution processes, ACCC approval of capacity allocation systems, and certain reporting requirements. Exempt service providers are still required to deal with exporters in good faith and publish a port loading statement and loading procedures.
The ACCC’s Issues Paper outlines GrainCorp and Emerald’s exemption applications and seeks public submissions in response to questions in the paper. The closing date for submissions is Friday 30 January 2015.
The Issues Paper and other relevant documents are available at Victorian wheat ports exemption assessments.