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WA Rail Access Regime – Draft Recommendation on Certification Tribunal’S Decision on Declaration of Pilbara Railways – Part 2 Who’S Who in Regulation - ESC

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WA Rail Access Regime – Draft Recommendation on Certification Tribunal’S Decision on Declaration of Pilbara Railways – Part 2 Who’S Who in Regulation - ESC Issue Nine October 2010 Queensland Rail Access Regime & Central Queensland Coal Network On 14 September 2010 the Council released its that the rail transport services provided by the draft recommendations on Pacific National’s CQCN not be declared and therefore not applications under s 44F(1) of the Trade brought under Part IIIA of the TPA. Practices Act 1974 (TPA) for declaration of the In the Council’s draft recommendation on the services provided by the Central Queensland certification application, the Council notes that: Coal Rail Network (CQCN) and on the Pacific National (in particular) argues that to Queensland Government’s application under be certified as effective, the Queensland s 44M of the TPA for certification of the Rail Access Regime must be able to prevent Queensland Rail Access Regime. Details of Pacific National’s declaration applications were QR National from treating its rail operations provided In the June 2010 issue of Accessible. any differently than those of rival third The Council discussed the Queensland party rail operators and that, in the context Government’s certification application in the of the proposed privatisation of QR National August 2010 issue. as a vertically integrated rail operator, the Regime cannot be effective. To recap, the Queensland Rail Access Regime applies to the rail transport services provided by To the contrary, the Queensland the CQCN, rail transport services provided by Government submits that the issue of infrastructure for which Queensland Rail Limited whether QR National is vertically integrated is the railway manager, and coal handling is not a matter for the Council and the services at Dalrymple Bay Coal Terminal. Queensland Rail Access Regime meets the requirements for certification in the TPA. If the Queensland Rail Access Regime is certified as effective, regulation of access to the rail In reaching its preliminary view on the The Council’s draft transport services covered by the Regime will be certification application, the Council accepts recommendations on the subject to the Queensland Competition that recent amendments to the Queensland Rail certification and declaration applications Authority Act 1997 which is administered by the Access Regime have strengthened its operation. are available on the Queensland Competition Authority (QCA). If In the Council’s view, while the proposed website at Pacific National’s applications for declaration of structure and sale of QR National is relevant to www.ncc.gov.au the services provided by the CQCN were to be the context in which the Council must make its successful, those services would be subject to recommendations, the TPA does not allow for the national third party access regime under the broad approach to considering a Part IIIA of the TPA. certification application that Pacific National Having considered these applications and the suggests. first and supplementary rounds of submissions The Council has concluded in a number of past from interested parties, the Council proposes to recommendations that the process of recommend to the Commonwealth Treasurer, certification does not involve an assessment of who is the decision-making Minister for the whether an access regime is ‘optimal’. In the certification application, that the Queensland Council’s view the TPA requires that it considers Rail Access Regime be certified as an effective only whether an access regime addresses the access regime for a period of 10 years. principles set out in clause 6 of the Competition This means that the Council will recommend to Principles Agreement and accords with the the Premier of Queensland, who is the decision- objects of Part IIIA of the TPA. making Minister for the declaration applications, WA rail access regime – draft recommendation on certification Tribunal’s decision on declaration of Pilbara railways – part 2 Who’s who in regulation - ESC Issue Nine October 2010 On this basis the Council has reached a In this case, the Council is concerned that the preliminary view that the Regime should be regulation of third party access to the relevant certified as effective. rail transport services in Queensland may be less In relation to the declaration applications made effective under the national access regime in by Pacific National, the Council is required to Part IIIA of the TPA than under the Queensland Minister’s deemed consider whether the six declaration criteria (a) Rail Access Regime. decision not to declare to (f) in s 44G of the TPA are met. Under the Queensland Rail Access Regime, the Herbert River cane railway In the Council’s view criteria (a), (b), (c), and (d) QR National will be bound by a detailed access are met. These criteria relate to, respectively: undertaking approved by the QCA, whereas if On 16 July 2010 the Council provided its final access materially promoting competition; the access to the rail transport services provided by recommendation to the relevant railways being uneconomical to the CQCN is declared under Part IIIA the ACCC may have to arbitrate a large number of access designated Minister that duplicate; national significance and safety. the service provided by disputes on a case by case basis. However, the Council is not satisfied that criteria the Herbert River cane (e) and (f) are met. Criterion (e) precludes The Council is now seeking submissions on its railway not be declared. declaration where services are subject to an draft recommendations. The closing date for As the Minister did not effective state access regime. Given the submissions is 5pm on 14 October 2010. Once publish a decision within Council’s conclusion in relation to the the Council has considered these submissions 60 days, he is deemed to Queensland Government’s certification and undertaken further analysis it will provide have decided not to application this criterion is not met. its final recommendations to the declare the service. The Commonwealth Treasurer and the Premier of Council’s final Criterion (f) requires that the Council is satisfied Queensland. recommendation is that access is not contrary to the public interest available on its website at before recommending declaration. www.ncc.gov.au. WA Rail Access Regime – draft recommendation on certification On 17 August 2010 the Council released its draft Pty Ltd that runs from Cloudbreak to Port recommendation on the Western Australian Hedland. The Regime provides for the inclusion Government’s application under s 44M of the of new railways in the future. TPA for certification of the Western Australian If the Western Australian Rail Access Regime is Rail Access Regime established under the certified as effective it will exclusively regulate Railways (Access) Act 1998 and the Railways access to the below rail services of the railways (Access) Code 2000 (Code). Details of the covered by the Regime. This means that these application were provided in the June 2010 issue services cannot be declared under Part IIIA of of Accessible. the TPA or subject to an access undertaking to The Council’s proposed recommendation to the the Australian Competition and Consumer Commonwealth Treasurer, who is the decision- Commission. making Minister in this matter, is that the The Council received four submissions in Regime be certified as an effective access response to the draft recommendation—from regime until 31 December 2015. The proposed BHP Billiton Iron Ore Pty Ltd, the North West duration links the period of certification with the Iron Ore Alliance, Roy Hill Infrastructure Pty Ltd next review of the Code by the Economic and WestNet Rail. The submission from Roy Hill Regulation Authority of Western Australia. Infrastructure Pty Ltd raised a number of issues To recap, the Western Australian Rail Access that the Council considers it should allow the Regime covers the railways specified in applicant and other interested parties to Schedule 1 of the Code which includes 5000 respond to before the Council finalises its kilometres of rail track in the south-west of recommendation. Accordingly, the Council has Western Australian, including the urban invited further submissions on the issues raised (predominantly passenger) network and the by Roy Hill Infrastructure. The closing date for non-urban freight network. This generally submissions is 5pm on 6 October 2010. Once comprises all standard and narrow gauge track the Council has considered any submissions and and associated infrastructure west of Kalgoorlie. undertaken further analysis it will provide its The regime also covers the 280 kilometre final recommendation to the Commonwealth railway operated by The Pilbara Infrastructure Treasurer. Page | 2 Issue Nine October 2010 Tribunal’s decision on declaration of Pilbara railways – part 2 In the August 2010 issue of Accessible the view that health and safety issues were best Council discussed the Australian Competition addressed in the context of negotiation and Tribunal's (Tribunal) decisions on the Part IIIA arbitration of access terms and that criterion (d) declaration matters relating to services provided was unnecessary. This further supports the by four significant iron ore railways in Western recent repeal of criterion (d) by the Trade Australia’s Pilbara region (In the matter of Practices Amendment (Infrastructure Access) Act Fortescue Metals Group Limited [2010] ACompT 2010. 2). In this issue the Council explains the Definitions of “facility” and “service” subsequent developments in the matter and The Tribunal provided important guidance some further items of interest in
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