ACCC invites additional feedback on Asciano deal


Industry stakeholders asked to submit response to ACCC’s statement of issues by June 10

ACCC invites additional feedback on Asciano deal
The ACCC will review the additional responses before announcing its decision on July 21.

 

The Australian Competition and Consumer Commission (ACCC) is calling for more submissions from industry stakeholders in response to its statement of issues regarding the proposed takeover of Asciano.

On releasing the document, the commission says that since commencing the review of the proposed acquisition in March it has received a number of submissions from relevant stakeholders highlighting concerns.

"The ACCC is now seeking additional feedback from interested parties on the likelihood of competition being lessened in container landside logistics at each port, the provision of regional rail container export services into Port Botany, and stevedoring," ACCC chairman Rod Sims says.

The last date to make the submission is June 10.

The commission will review the additional responses before announcing its decision on July 21.

Since the proposal to split the Asciano business between a consortium comprising Qube Holdings, Brookfield Infrastructure Partners and a group of global private equity and pension funds went public, stakeholders from the import/export container supply chain sector have raised several concerns.

"Market participants have expressed concerns about the vertical integration of Patrick container terminals with the two largest landside import-export container logistics providers in Australia, Qube and ACFS," Sims says.

"The ACCC considers this to be a significantly greater degree of vertical integration than the current situation where Patrick is vertically integrated with only ACFS.

"The ACCC is concerned that Patrick container terminals may provide preferential access to Qube and ACFS vehicles, and Qube regional export trains running into Port Botany, and raise rivals’ costs.

"Qube and Brookfield will each own 50 per cent of Patrick container terminals, and may have parallel incentives to favour their landside logistics operations."

There are also concerns that the deal could result in a decline in competition, leading to foreclosure of some rival stevedores.

"Market participants have suggested that if Patrick gives favourable treatment to the container logistics operations of both Qube and ACFS, then Qube and ACFS may provide a superior service offering to importers and exporters on condition that they use shipping lines calling at Patrick container terminals.

"This may lessen competition in stevedoring."

The ACCC is also considering whether stevedoring and empty container park services will be aligned in a way that affects rival stevedores.

Details of the proposed deal are available on the ACCC website.

Asciano’s proposed takeover deal has hit a few speed bumps along the way.

Last week, Asciano agreed to the Foreign Investment Review Board (FIRB’s) request to delay its decision deadline regarding certain approvals required to finalise the deal until after the July elections.

Earlier, ACFS Port Logistics sought legal intervention demanding clarification on the impact of the takeover on its business and its rights under a 2015 deal with Patrick that saw a merger of operations of both companies in Sydney and Melbourne.

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