The National Competition Council has rejected a NSW Minerals Council application to remove the Port of Newcastle's right to set prices for customers who use its infrastructure.
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The Minerals Council had argued that the government should control pricing for access to and use of the port's shipping channels for the export of coal.
It is the latest chapter in a long-running dispute between the council and the port over pricing that has been running since 2015.
"On balance, the council expects the NSW Government would be likely to intervene if PNO imposed excessive price increases or other access limitations that had the potential to have a material adverse impact on competition in the dependent markets; or otherwise harm the public interest," the council said.
"Such an intervention might be via the terms of PNO's lease or by introducing new statutory restrictions. While the threat of such action would be likely to apply some level of constraint on PNO when it sets its terms and conditions of access in a future without declaration of the Service, the council considers the effect of this constraint falls well short of that which would result from an access regime capable of certification.
"The Council considers that these constraints are not a substitute for the type of access regulation contemplated by the National Access Regime."
NSW Minerals Council chief executive Stephen Galilee said: "It's a huge economic risk that the world's largest coal export port and such an important infrastructure asset for NSW and the nation is able to operate as a monopoly without proper regulation or oversight.
"We will continue to pursue all means available to secure a fair go for our affected member companies and to protect the economy, and investment and jobs for the Hunter."
The council also cited comments from Australian Competition and Consumer Commission chairman Rod Sims regarding the port.
Mr Sims told the National Press Club in October:
"On many occasions journalists have said to me they think a company is misbehaving when the company is simply using its market power. Such as when electricity companies increased electricity prices when Hazelwood closed, or when the monopoly port of Newcastle increased its prices by around 50 per cent because there is no regulation preventing this."
"In these circumstances companies are not misbehaving. Their behaviour is not some form of aberration. They are simply acting commercially and predictably to maximise profits as their shareholders demand of them.
"The issue for all of us is how do we prevent companies gaining too much market power in the first place and, when they have it, how do we deal with the most damaging consequences of the use of that market power......"
Submissions on the Council's draft recommendation must be made by November 20.
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