Miners Can Collectively Bargain with Port

Filed under News, Port & Shipping ~ by Press on  21 Jun 2020

Coal producers to be authorised to collectively negotiate with Port of Newcastle.

The ACCC proposes to allow the NSW Minerals Council and ten coal producers to collectively negotiate the terms and conditions, including price, of access to the Port of Newcastle for the export of coal and other minerals.

Other mining companies will be able to join the collective negotiations with Port of Newcastle Operations (PNO) in the future.

Since December 2019, PNO has been negotiating with individual coal producers over a proposed 10 year agreement for access to the port.

The NSW Minerals Council and coal companies seek to collectively negotiate the terms and conditions of this agreement with PNO.

The ACCC allowed coal producers to start collective negotiations with PNO in an interim authorisation granted on 2 April 2020. It proposes to authorise those arrangements for ten years.

The proposed collective bargaining is voluntary for coal producers and does not include any collective boycott activity.  The ACCC’s proposed authorisation does not extend to sharing sensitive commercial information about customers, marketing strategies, coal volumes or future projections.

Collective negotiation gives coal producers an opportunity to reduce uncertainty and achieve more timely outcomes,” ACCC Commissioner Stephen Ridgeway said.

The ACCC considers there are several likely public benefits from granting this authorisation, including greater input by coal producers into the final agreement, which would ultimately facilitate more efficient investment decisions for the Hunter Valley coal industry. It will also result in lower negotiating costs for all parties involved,” Mr Ridgeway said.

The voluntary nature of the collective negotiations for both PNO and coal producers means this is unlikely to affect competition between coal producers.

Coal producers will remain free to negotiate individually with PNO if it is in their commercial interests to do so,” Mr Ridgeway said.

The ACCC has invited comments on the draft determination for its final assessment, with a decision likely in August or September 2020.

Further information, including the application for authorisation and details about how to make a submission are available on the ACCC’s Authorisations Public Register.

Background

ACCC authorisation provides statutory protection from court action for conduct that might otherwise be in breach of the competition provisions of the Competition and Consumer Act 2010 (the Act). Broadly, the ACCC may grant final authorisation when it is satisfied that the likely public benefit from the conduct outweighs any likely public detriment.

The 10 coal producers who export coal through the Port of Newcastle and are applicants to the application are Glencore Coal, Yancoal Australia, Peabody Energy Australia, Bloomfield Collieries, Centennial Coal, Malabar Coal, Whitehaven Coal, Hunter Valley Energy Coal, Idemitsu Australia, and MACH Energy Australia.

At the end of 2019, PNO invited coal producers, vessel agents, vessel operators and FOB coal consignees to enter into bilateral long term discounted pricing arrangements (the Deed), which includes discounted navigation service charges and wharfage prices set by PNO. The term offered by PNO under the Deed is ten years.

Following the privatisation of the Port of Newcastle by the NSW Government in 2014, PNO operates the port under a long term lease arrangement from the NSW Government.  PNO is the trustee for the Port Of Newcastle Unit Trust, which is jointly owned by investors The Infrastructure Fund, and China Merchants Port Holdings Company.

The Applicants have indicated their intention to lodge an application with the National Competition Council for declaration of the channel services at the Port, in or around June 2020. Pursuant to ACCC authorisation, the Applicants intend to collectively negotiate with PNO subsequent to any declaration of the Port’s channel services.



Previous postThe Coal Curse Next postWater Interruptions for Barrington Village
Our content: Terms of Use   |    © 2020 Newcastle on Hunter ~ Mostly Good News   |    Design by milo