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ACCC refuses to back down on Pacific National merger, launches High Court bid
The competition watchdog has sought special leave to take its fight with Pacific National’s acquisition of the Acacia Ridge freight rail terminal to the High Court.
Tony Zhang
The Australian Competition and Consumer Commission’s request escalates chairman Rod Sims' opposition to the sale of the terminal in Brisbane’s southern suburbs.
The $205 million acquisition, from rival hauler Aurizon, has been at the centre of a running dispute between the Australian Competition and Consumer Commission and the two rail companies since it was first announced in 2017, with the national competition watchdog arguing the sale would give Pacific National an effective monopoly on railing freight into northern Queensland.
The ACCC has lost successive legal bids to block the transaction, with the Federal Appeals Court last month upholding a May 2019 decision by Justice Jonathan Beach to allow the sale.
Mr Sims said the ACCC had decided to seek special leave to the High Court because the acquisition of the Acacia Ridge terminal would effectively entrench Pacific National’s near-monopoly in the rail freight market on the east coast.
“Competition depends on rivals having a chance to compete. While no one can predict the future, we do know that, with this acquisition, the barriers to entry would become effectively insurmountable,” he said.
“A lack of competition in rail freight would likely lead to increased prices for businesses and consumers around the country.”
The Federal Court had sided with Pacific National in 2019, saying the sale of the intermodal terminal by Aurizon – which allows freight to be moved between trucks and trains – would not substantially lessen competition.
In his original decision, Justice Beach said he may have accepted the ACCC’s argument that Pacific National’s ownership of the terminal could have the effect of reducing competition in Queensland’s freight industry had it not been for a voluntary undertaking offered by Pacific National on the last day of court hearings, giving guarantees around access and pricing for third-party users.
Mr Sims acknowledged the ACCC had a mixed record in the courts, but he thought this case was worth pursuing despite the Federal Court defeat.
“We believe that the Full Federal Court’s decision does not recognise the full impact of the proposed acquisition on competition in this vitally important industry,” he said.
“We are seeking special leave to appeal to the High Court because it is vital for Australian businesses and consumers that competition laws are effective in protecting the competitive process.”
The terminal is currently the only point in Queensland where goods can be transferred from NSW’s standard gauge rail to Queensland’s narrow gauge track, or to road haulage.
Pacific National chief executive Dean Dalla Valle earlier this year said the Federal Court had made the right decision, saying the purchase of the Acacia Ridge terminal would allow greater efficiencies for their customers.
Aurizon, which is in the process of a three-stage sale of the loss-making terminal, said it would continue to operate Acacia Ridge until a decision was made by the High Court.
Pacific National is represented by Clayton Utz with Aurizon advised by Ashurst.
