First case under new provision concerning abuse of market power
The Federal Court has declared by consent that Tasmanian Ports Corporation Pty Ltd (TasPorts) had breached section 46 of the Competition and Consumer Act by imposing a new port access charge on one of its customers, Grange Resources Ltd, after Grange notified TasPorts that it was going to switch to Engage Marine Tasmania Pty Ltd, a new provider of towage and pilotage services.
TasPorts is a corporation wholly owned by the State of Tasmania. It owns and operates the majority of ports in Tasmania and performs a range of port and marine operations at ports around Tasmania. Before Engage Marine entered the market, TasPorts was the sole supplier of pilotage and towage services at all major ports in Tasmania. TasPorts does not own Port Latta; it is owned by Grange, which operates the Savage River iron ore mine and exports iron ore from Port Latta in northern Tasmania. Grange was dissatisfied with the quality of service and the prices charged by TasPorts for towage and pilotage services; and it decided to purchase these services from Engage. TasPorts responded by imposing new port access charges on Grange.
The Australian Competition and Consumer Commission (ACCC) retained Frontier Economics to advise on the economic issues of the case. The ACCC lodged the expert testimony of Philip Williams of Frontier Economics (and a Statement in Reply to the testimony lodged by TasPorts) with the Court.