Commodity trading and mining company Glencore has won its case to overturn large increases in port access charges at the Port of Newcastle, the biggest port on Australia’s east coast.
Australia’s full Federal Court supported the organisation’s wish for port access charges to be overseen by the Australian Competition & Consumer Commission (ACCC), marking the end of a three-year challenge to price increases of over 60%.
The Port of Newcastle had lodged an appeal against the ACCC’s decision to make the port’s operations a ‘declared service’, but it was unanimously dismissed by the Federal Court.
The port said it would assess the decision, with sources saying that an appeal was possible, The Australian reported.
Glencore had sought the ruling after having been knocked back by the National Competition Commission and the federal government as it looked to overturn the price hikes.
"Since its privatisation for $1.75bn in 2014, the Port of Newcastle has revalued its assets and increased shipping fees by in excess of 60% without any change in the nature or quality of service provided," Glencore said.
"The introduction of a reasonable regulatory constraint is critical for all users of monopoly-owned infrastructure."
ACCC chairman Rod Sims was similarly pleased with the decision, telling The Australian: "This is unambiguously good news for everybody except those people who bought ports, thinking they could put prices up by whatever they liked."
The chairman added that the "emphatic" court victory would not halt price increases, but it would improve port users’ bargaining status.
"It means that the port users have some bargaining clout," he explained.
"When you negotiate with a monopoly you have no clout. Now they have some.
"They can approach the ACCC to adjudicate if they can’t come to their own commercial agreement," he added.
The Port of Newcastle’s chief executive lamented the decision, saying that it could have a number of negative consequences.
"This is a disappointing outcome, not just for Port of Newcastle but potentially for many other major infrastructure providers across Australia," Geoff Crowe said.
"It could have wide-ranging implications for the profitability and value of nationally significant assets."
