The full bench of the Federal Court has ruled the terms of the privatisation of NSW's ports including Port Kembla was not anti-competitive.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
The ACCC had alleged that the agreements by which Port Kembla, Port Botany and the Port of Newcastle were sold to private investors was anti-competitive, as included in the agreements was an obligation for the state of NSW to compensate NSW Ports, the long term lessee of Port Kembla and Port Botany, if container traffic at the Port of Newcastle is above a specified cap.
The agreement had the effect of making container traffic through the Port of Newcastle prohibitively expensive.
The Federal Court found the compensation terms were not anti-competitive.
A public judgement has not yet been released.
ACCC commissioner Liza Carver said the consumer watchdog was concerned that the terms of the agreement created a monopoly in container port services in NSW for 50 years after privatisation.
"We appealed this case because we considered that the compensation provisions created a significant barrier to entry," she said.
"The threat of new entry is an important part of the competitive process, and imposes a competitive discipline on existing businesses, including monopolies."
NSW Ports welcomed the decision, with CEO Marika Calfas saying the decision provided economic certainty.
"Maintaining the right ports and freight strategy to cater for NSW's growing trade needs is crucial to the State's economic future," she said.
In November last year, the NSW government passed legislation that extinguished the reimbursement requirements, enabling the Port of Newcastle to go ahead with its plans to build a container port.
The NSW government's current freight strategy identifies Port Kembla as the location of the state's second container port once Port Botany reaches capacity in the 2040s.
Our news app has had a makeover, making it faster and giving you access to even more great content. Download The Illawarra Mercury news app in the Apple Store and Google Play.
