Draft decision on interstate rail network access undertaking

20 December 2018

The ACCC will not accept the proposed 2018 interstate rail network access undertaking lodged by the Australian Rail Track Corporation (ARTC), in a draft decision announced today.

“The ACCC considers that the proposed access undertaking is not acceptable on a number of fronts,” ACCC Commissioner Cristina Cifuentes said.

“In making our draft decision we have had regard to a number of fundamental issues being proposed by ARTC and the lack of information available to the ACCC and the above-rail operators to assess the impact of these.”

ARTC is seeking more flexibility by shifting from indicative tariffs approved by the ACCC, to a proposed range within which ARTC and above-rail operators can negotiate access charges.

However, the ACCC has significant concerns with ARTC’s proposed value of the regulated asset base, the rate of return and the ceiling limit which determine the bounds of the access charges ARTC can levy.

The other key issue in this assessment is the potential for gaps in access regulation, between the proposed expiry of the 2018 interstate access undertaking in 2023, and the intended commencement date of Inland Rail and any replacement undertaking in 2025.

“In our draft decision, we have provided detailed feedback that ARTC can use to revise the 2018 interstate access undertaking. We have also requested substantial further information from ARTC and feedback on the proposal from stakeholders so we can assess any revised access undertaking proposal,” Ms Cifuentes said.

The ACCC is seeking submissions in relation to this draft decision, which are due by 18 February 2019.

The draft decision is available at Interstate Rail access undertaking 2018

Background

ARTC operates rail tracks in Queensland, New South Wales, South Australia, Victoria and Western Australia.

On 6 March 2018, ARTC submitted the 2018 interstate access undertaking to the ACCC for assessment pursuant to Part IIIA of the Competition and Consumer Act 2010.

Part IIIA allows infrastructure providers to submit a voluntary access undertaking to the ACCC for approval.

An access undertaking allows access providers to obtain a degree of certainty about the terms and conditions on which access will be made available to their infrastructure and allows rail operators that are considering establishing new infrastructure to settle access matters before they invest.

This access undertaking is for the provision of access to the interstate rail network operated by ARTC.

The interstate rail network consists of the standard gauge track between Kalgoorlie in Western Australia to Acacia Ridge in Queensland, and transports bulk freight, non-bulk freight and passengers.

The ACCC previously accepted an access undertaking in relation to the interstate rail network on 30 July 2008. ARTC has sought to extend the 2008 interstate access undertaking twice, which the ACCC has consented to. The 2008 interstate access undertaking is due to expire on 28 February 2019.

Release number: 
276/18
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