Australia: Competition regulator clears bids for Melbourne lease

The Australian Competition and Consumer Commission will not oppose two separate proposals by consortia to acquire the 50-year lease of the Port of Melbourne, following a review of potential cross-ownership interests and vertical relationships.

The ACCC’s review of both the IFM Consortium and QIC Consortium proposals focused primarily on the cross-ownership interests in the Port of Melbourne, North South Wales Ports, and the Port of Brisbane, and vertical relationships with port services providers operating at the Port of Melbourne.

ACCC chairman, Rod Sims, said: “The ACCC conducted extensive inquiries with a large number of port users and stakeholders at various levels of the supply chain. The ACCC has formed the view that neither acquisition would result in a substantial lessening of competition.”

“While there are a small group of exporters in southern NSW, particularly in the Riverina region, who have the option of using Port Botany or the Port of Melbourne, the vast majority of port users have no choice, for them the Port of Melbourne is a monopoly asset,” he added.

Sims had in fact recently spoken out against port privatisations, stating they were increasing prices and “damaging the economy”.

However, the proposed regulatory regime is largely a separate matter to this competition assessment. The regime to apply at the Port of Melbourne will be overseen by the Victorian Essential Services Commission and will cap many fees and prices for port users at CPI for the first 15 years of the lease.

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