On 10 April 2014, the ACCC issued a draft determination proposing to consent to GrainCorp’s application to vary its Port Terminal Services Access Undertaking (Access Undertaking) at its Newcastle bulk grain facility.
GrainCorp applied to the ACCC to vary its undertaking to allow its Carrington port terminal in Newcastle to be subject to minimal regulation. GrainCorp proposed to exclude certain provisions of the Access Undertaking from applying at its Newcastle Port. It also proposed amendments to the Port Terminal Services Protocols, to exclude Newcastle Port from their application and to establish a standalone GrainCorp Newcastle Port Terminal Services Protocols, which would not form part of the Access Undertaking.
GrainCorp submitted that it now faces competition from two other bulk wheat export facilities, which are not subject to access regulation, which places GrainCorp at a competitive disadvantage.
The ACCC considered that where there is sufficient competition, minimal or no regulation is required. However, where wheat ports have significant market power or are a monopoly and owned by a wheat marketer in competition with others upstream, then regulation is required to ensure farmers can sell their grain into a competitive market.
Having examined the port of Newcastle and the surrounding port zone, the ACCC’s draft view is that there is a sufficient level of competition and capacity at the port, and up-country, such that the current level of regulation is no longer required.
GrainCorp’s undertaking will continue to apply the existing level of access regulation at its six other port terminals.