Treasurer Josh Frydenberg has endorsed deregulation of Newcastle port's shipping channel, sparking protest from the mining industry.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
The latest development in four years of tortuous legal and legislative manoeuvring will effectively allow Port of Newcastle to resume setting its own charges for using the channel.
The private port operator appealed to the National Competition Council last year after mining giant Glencore mounted a campaign, approved by the Australian Competition Tribunal and endorsed by the Federal Court in 2016, to reinstate regulation at the port.
Glencore's campaign came after Port of Newcastle raised access charges by up to 60 per cent soon after taking over the port in 2014.
The Australian Competition and Consumer Commission has been arbitrating pricing disputes between the port operator and its users since 2016 and only last year, following an application from Glencore, ordered the port to cut its fees by 20 per cent.
The NCC supported reinstating deregulation at the port in July, and Mr Frydenberg, by not countering this recommendation within 60 days, effectively endorsed the move on Tuesday.
Part of NCC's rationale in supporting deregulation was that to do otherwise "would undermine the viability of efficient investment decisions and hence risk deterring future investment in important infrastructure projects".
The ACCC would not comment on Tuesday, but chair Rod Sims is expected to raise the issue at the Australasian Transport Research Forum in Canberra on Monday.
Late last year, Mr Sims warned the NCC, which makes recommendations on the regulation of third-party access to monopoly infrastructure, that its "extremely disappointing" recommendation set a worrying precedent for users of all privatised infrastructure.
"Port of Newcastle will be an unregulated monopolist that is able to determine the terms and conditions of its access with little constraint," he said at the time.
"It would be reasonable to expect that, without regulation, further price increases at the port would follow."
A Glencore spokesperson said on Tuesday that the Treasurer's decision was "very disappointing".
Port of Newcastle chief executive officer Craig Carmody welcomed the outcome, which may yet be subject to legal challenge.
"PON has long maintained the view that the Port should never have been declared [regulated] and that the NCC's original position in 2015 was sound," he said.
"The NCC's recommendation was founded on robust legal and economic arguments for its position, and the NCC stuck to its guns in the face of some considerable pressure from other parties.
"This is a victory for a common-sense approach to regulation. The outcome is consistent with the intent of the legislation as originally envisaged by the Productivity Commission and re-endorsed by the Australian Parliament in 2017."
While you're with us, did you know Newcastle Herald offers breaking news alerts, daily email newsletters and more? Keep up to date with all the local news - sign up here.
IN NEWS TODAY:
- Martins Creek quarry: Daracon shuts site after Land and Environment Court battle with Dungog Shire Council
- Port Stephens-Hunter police appeal for information over malicious damage to vehicle in Lawes Street, East Maitland
- One year old Zaylee Cambridge battles aggressive cancer after neuroblastoma diagnosis at John Hunter Children's Hospital
- Steel City 20 years on: Remembering the human toll | Picture gallery & Event details
- Stockton Beach erosion: Engineers studied Stockton sand movement in the 1970s as part of a project to relocate Newcastle Harbour