ACCC role in wheat export
The Port Terminal Access (Bulk Wheat) Code of Conduct, which was made on 30 September 2014, regulates the conduct of bulk wheat port terminal operators. The ACCC enforces the Code and also has certain specific roles in relation to exemptions and capacity allocation systems.
On 19 September 2014, the Minister for Agriculture announced the Port Terminal Access (Bulk Wheat) Code of Conduct, a mandatory Code prescribed under the Competition and Consumer Act 2010 (CCA).
The Code commenced on 30 September 2014 and regulates the conduct of bulk wheat port terminal operators. It replaced the previous wheat port access regime under the Wheat Export Marketing Act 2008 (WEMA).
The regulations under the Code include:
- an obligation on all port terminal operators to negotiate in good faith with wheat exporters for access to port terminal services
- an obligation to comply with ‘Continuous Disclosure Rules’
- obligations on port terminal operators not to discriminate or hinder access in the provision of port terminal services
- the ability for wheat exporters to seek mediation or binding arbitration on terms of access in the event of a dispute
- obligations relating to publishing and approval for port loading protocols for managing demand for port terminal services
- publishing requirements.
The Code has two tiers of regulation whereby port operators may be exempted from some of the above Code requirements.
The ACCC enforces the regulations in the Code, and has an ongoing role monitoring compliance. It also has certain specific roles, including:
- assessing and making determinations in relation to whether a port terminal service provider is an exempt provider (and, if appropriate, revoking such a determination)
- assessing and approving the capacity allocation system for a port terminal service provider.
Unlike the previous undertaking regime, the ACCC does not have any role arbitrating disputes between port terminal service providers and access seekers.
The Minister for Agriculture has a separate role whereby a port terminal service provider may be exempted from obligations under the Code on the basis that it is a cooperative that meets certain characteristics defined in the Code. The ACCC has no role in relation to these cooperative exemptions.
See also: Wheat export projects
On 6 November 2014 the ACCC sent a letter to industry stakeholders outlining the ACCC’s intended schedule for conducting exemption assessments under clause 5 of the Code.
The letter includes the ACCC’s indicative timeline for commencing exemption assessment processes for relevant port terminal facilities.
Clause 5(1) of the Code provides that the Minister for Agriculture may determine that a port terminal service provider is an exempt service provider if they are satisfied that the provider is a cooperative that has:
- grain-producer members who represent at least a two-thirds majority of grain-producers within the grain catchment area for the port concerned
- sound governance arrangements that ensure the business functions efficiently and that allow its members to influence the management decisions of the cooperative.
The ACCC has been informed that, on 17 November 2014 the Minister for Agriculture found that Co-Operative Bulk Handling Limited’s (CBH) port terminal facilities located at Albany, Esperance, Geraldton and Kwinana satisfactorily meet the criteria for exemption, and determined that those facilities are exempt from Parts 3 to 6 of the Code.
CBH remains obligated to comply with Part 2 of the Code. Part 2 of the Code contains general obligations on port terminal service providers to deal in good faith and publish certain information including a daily loading statement.
A copy of the Minister’s Notice of Determination of Exemption is available on CBH’s website.
The ACCC is required to publish process guidelines in relation to its process for:
- making exemption determinations and revoking exemption determinations under clause 5 of the Code
- approving capacity allocation systems under clause 25 of the Code.
The ACCC published both process guidelines on 16 October 2014.
Prior to the Code, wheat port access was regulated under the WEMA. In order to export bulk wheat, wheat exporters who also owned and/or operated wheat port terminal facilities were required by the WEMA to pass an 'access test'. Having an access undertaking accepted by the ACCC under Part IIIA of the CCA was one component of the access test.
The ACCC accepted undertakings from four operators – CBH, Emerald, GrainCorp and Viterra – under the WEMA regime. Undertakings were originally accepted by the ACCC in 2009, with subsequent undertakings being accepted in 2011 and 2013. The ACCC also considered variations to the undertakings, monitored compliance, and had other roles under the undertakings.
Interested parties who wish to raise a question or concern about the Code should contact:
Mr Michael Eady
Director, Regulated Access – Wheat Ports
Fuel, Transport and Prices Oversight Branch
GPO Box 520
MELBOURNE VIC 3001
Tel: 03 9290 1945