ACCC to probe Qube’s Newcastle Agri Terminal buy

Investigation on enforcement basis after acquisition completed in September

ACCC to probe Qube’s Newcastle Agri Terminal buy
Rod Sims


The Australian Competition and Consumer Commission (ACCC) is investigating potential competition issues around Qube’s Newcastle Agri Terminal purchase.

As the probe relates to a completed acquisition, it will be conducted on an enforcement basis, ACCC alerts.

According to the competition watchdog, Qube notified it on September 8 and then completed the transaction on September 30, despite requests from the ACCC to delay completion of the transaction after concerns were raised by market participants.

The ACCC  said it was not provided with sufficient time or information to assess the competitive impact of the transaction.

Potential competition concerns raised related to the vertically integrated position that Qube will now hold in the supply chain for delivery of bulk grain to the Port of Newcastle, and the potential for Qube to engage in anti-competitive bundling of storage, handling and transport with terminal services.

How Qube made the Agri Terminal purchase, here

"Our investigation will focus on the impact of the acquisition on the supply chain for bulk grain export through the Port of Newcastle, and the ability and incentive for Qube to discriminate against rivals," ACCC chair Rod Sims said.

"It is worrying when a major vertically integrated player pays $90 million for key infrastructure used for the export of agricultural products without first obtaining the ACCC’s view on whether the proposed acquisition is likely to have the effect of substantially lessening competition.

"By choosing to proceed before the ACCC had a chance to conduct its review, Qube and the former owners of the Newcastle Agri Terminal are exposed to potential legal action by the ACCC."

The ACCC invited submissions from market participants who may have concerns about the acquisition or wish to share information about the market.

Qube Logistics owns and operates up-country grain storage sites at Narromine and Coonamble, and supplies rail haulage in NSW.

It also owns and operates the Quattro bulk grain terminal in Port Kembla, NSW.

Newcastle Agri Terminal is a bulk grain terminal at the Port of Newcastle, one of two bulk grain terminals there servicing export grain from farms and storage in northern NSW.

It notified the Australian Securities Exchange (ASX) of the ACCC action.

Potential remedies for a breach the Competition and Consumer Act relevant to this acquisition include an order for the shares or assets acquired to be divested or for the transaction to be declared void and unwound. 

The ACCC can also seek penalties in respect of a breach of the Act.


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