Asciano worries privatised QR could be anti-competitive

Asciano wants QR's track assets declared, fearing it will monopolise them and deny competitors access

May 19, 2010

Rail operator Asciano has written to the National Competition Council over fears a privatised Queensland Rail (QR) could lead to anti-competitive behaviour.

Asciano Managing Director Mark Rowsthorn has requested QR’s coal rail track assets be declared under the Trade Practices Act.

The Queensland Government is trying to offload QR and the tracks it operates on as part of a sale of public assets including motorways and the Port of Brisbane.

Despite the Government claiming it has sufficient safeguards, Rowsthorn claims a declaration is necessary to prevent QR from using its track monopoly to benefit its freight business.

He says a situation where QR owns the freight business and the tracks "is intolerable" because existing regulations cannot ensure Asciano can compete fairly.

"The current arrangements allow the network part of the QR national business, QR Network, to structure contracts so that it is difficult for a coal miner to move away from using QR National for its coal haulage requirements," Rowsthorn says.

"It puts at risk more than $1.5 billion of potential investment from Asciano in Queensland."

However, Queensland Treasurer Andrew Fraser says there are already protections in place to ensure there is competition.

"The Queensland Government is satisfied that there is already a strong and robust rail access regime administered by the Queensland Competition Authority (QCA) that has allowed competition to flourish on the Queensland coal network," Fraser says.

Under the regime, Fraser says Asciano has a 17 percent share in the coal haulage market and is due to increase it to 30 percent by 2015.

He says the Government has "strong confidence" in the existing scheme and will ask the National Competition Council to certify it.

"We will also be announcing a range of regulatory enhancements to the QCA's rail access regime that will be the subject of legislation to be introduced in the post-Budget sitting," Fraser says, adding that the changes will strengthen the regime.

He says the QCA is currently considering a new four-year access agreement with QR’s coal network. It is due to be finalised by the middle of this year.

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