Interstate rail network access undertaking to continue

28 February 2019

The Australian Rail Track Corporation’s (ARTC) 2008 interstate rail network access undertaking has been revised to operate for another 12 months, in an ACCC decision announced today.

The revised variation also increases the notification period in which ARTC must inform the ACCC whether it will submit a replacement undertaking from three months to six months before the expiry date.

The revised application replaces a previous variation submitted by ARTC in January this year, which included modifications to how ARTC escalates charges faced by users and a reconciliation mechanism that was dependent on the ACCC accepting a revised undertaking.

“We believe this revised variation to the undertaking will provide regulatory certainty and allows time for ARTC to consult with its customers and the ACCC to develop a replacement undertaking,” ACCC Chair Rod Sims said.

The ACCC says that it had concerns with the January undertaking but is satisfied that the revised variation meets the principles and criteria set out in Part IIIA of the Competition and Consumer Act 2010.

“It is important for the ACCC to ensure that ARTC, as a monopoly, does not exert its market power on users, which includes those that transport consumer goods. We also take into account ARTC’s legitimate business interests,” Mr Sims said.

Stakeholder responses to ARTC’s January variation expressed concerns about ARTC’s proposed approach to changes in access prices and the inclusion of a reconciliation mechanism to determine the final price paid by users for access to the rail network.

The ACCC will work with ARTC to develop a replacement undertaking that is consistent with the pricing principles, is transparent, supported by evidence and is submitted with sufficient time for consideration by stakeholders and the ACCC.

ARTC’s rail access undertakings are entirely voluntarily and submitted under Part IIIA of the Competition and Consumer Act 2010. The ACCC has become increasingly concerned with the appropriateness of this regulatory framework, in particular where ARTC submits applications shortly before the expiry of an existing undertaking.

The variation is available at January 2019 variation of the 2008 Interstate Access Undertaking.

Background

The 2008 interstate rail network access undertaking was due to expire on 28 February 2019 before the ACCC accepted the revised variation.

ARTC operates rail tracks in Queensland, New South Wales, Victoria, South Australia, and Western Australia.

Part IIIA of the Competition and Consumer Act allows infrastructure providers to submit a voluntary access undertaking to the ACCC for approval.

This access undertaking is for the provision of access to the interstate rail network operated by ARTC.

The interstate rail network consists of the standard gauge track between Kalgoorlie in Western Australia to the Queensland border, and transports bulk freight, non-bulk freight and passengers.

On 20 December 2018, the ACCC did not accept ARTC’s proposed 2018 interstate rail network access undertaking, which ARTC proposed to replace the undertaking accepted by the ACCC on 30 July 2008.

Release number: 
26/19
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