Tasmanian vegetable exporters to collectively negotiate cheaper shipping

The ACCC has decided not to object to the notification to allow collective negotiation of shipping on behalf of Tasmanian carrot and onion exporters.

Specifically,  Agility Logistics Pty Ltd (Agility), an international freight forwarder, will collectively negotiate with various shipping lines on behalf of three Tasmanian carrot and onion exporters, and any other Tasmanian carrot and onion exporters that join this group in the future (the Notified Conduct). 

Agility will primarily seek to negotiate cheaper container shipment rates based on the combined volume of produce of the participating exporters.

By collectively negotiating, Tasmanian carrot and onion exporters are likely to be able to achieve more competitive freight rates with international shipping companies, thereby improving their ability to compete in international markets.

The proposal for collective bargaining by carrot and onion exporters is an initiative of the Tasmanian Fruit and Vegetable Export Facilitation Group, which was formed with funding from the Australian and Tasmanian Governments and industry.

The Notified Conduct is unlikely to result in significant public detriments. Participating in collective negotiations will be voluntary for the participating exporters as well as the shipping companies, and the ability to collectively bargain is unlikely to significantly alter the competitive dynamics for the supply of shipping services  to Tasmania.

In the context of negotiating shipping rates, exporters may be considered to be each other’s competitors. Therefore, by conducting these negotiations jointly, rather than individually, they risk breaching competition laws.

By lodging a notification with the ACCC, businesses can obtain legal protection to engage in collective bargaining.  The ACCC can only remove that protection if it is satisfied that the public benefits from the arrangements or conduct are outweighed by the public detriments. 

Agility’s notification was lodged on 30 October 2018 and the ACCC has decided to allow the notification to remain in force for a period of 10 years, until 29 October 2028, unless the notification is withdrawn or revoked. 

For more information, please refer to the ACCC’s collective bargaining public register.

Published date: 
14 December 2018