ACCC monitors NT prices after derailment


The ACCC has warned Northern Territory businesses not to set prices unfairly in the wake of last month's freight train derailment near Katherine

ACCC monitors NT prices after derailment
ACCC monitors NT prices after derailment

By Anna Game-Lopata | January 9, 2012

The Australian Competition and Consumer Commission (ACCC) has warned Northern Territory businesses not to set prices unfairly in the wake of last month's freight train derailment north of Katherine.

The consumer watchdog was speaking out given damage to
Edith River Bridge caused by the derailment
continues to disrupt freight supplies to Darwin.

According to Northern Territory News, one freight company, Toll NQX has already added a 30 percent surcharge to the price of its services
between Melbourne, Adelaide
and Darwin and from Darwin to
Alice Sprongs, all of which will now be undertaken by road.

The ACCC concedes the prices of basic goods and services may rise if supply chains are disrupted following natural disasters
but argues
businesses should not misrepresent the impact on their prices.

"Prices might rise after disasters because it costs traders more to get goods into shops – for example, they may have to transport goods further due to road or rail closures, or use other ways to transport goods such as by air, which means increased costs," says ACCC Chairman Rod Sims.

"Prices also go up when there is a lack of goods or services, and greater demand."

While
businesses are free to set their own prices,
Sims says
traders must ensure they don’t mislead consumers about the reasons for price increases.

"Price rises unrelated to the recent derailment should not be blamed on the lack of trains. If a company makes a claim regarding the increase in their prices or about the size or nature of any surcharge to be levied, they need to make sure that claim is accurate."

Sims adds the ACCC is watching this issue closely in the Northern Territory and will be in contact with major companies where there are concerns that they may be making false or misleading claims about the impact of the recent event.

He says Australian consumer law provides the ACCC and NT Consumer Affairs with powers to investigate the accuracy of claims about the impact of natural disasters and encourages consumers and businesses to shop around.

"Consumers should also ask companies to justify prices and surcharges which appear to be unreasonably high," Sims says.

An investigation will be carried out into the
derailment of the 20-carriage iron ore freight train, which was swept off tracks by floodwaters on December 27th north of Katherine.

It's alleged some of the containers which floated away were carrying toxic copper concentrate.

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