Bowen's push to streamline National Access Regime

Federal competition minister Chris Bowen has started talks with States and Territories with a view to streamlining decision-making under the National Access Regime in Part IIIA of the Trade Practices Act.

By Rob McKay

While the move is seen in some quarters as a win for Fortescue Metals in its struggle to gain access to BHP Billiton's and Rio Tinto's Pilbara rail infrastructure, others see wider issues at play and a need for greater reform.
Bowen says there is a broad consensus that something needs to be done to speed up the process.
"Currently, processes under the National Access Regime can go on for years," he said.
While the regime appeared to be operating effectively, there were concerns it was generating regulatory risks that were hindering investment in essential infrastructure.
"Some infrastructure owners and access seekers have argued that processes under the regime are too lengthy and costly," Bowen said.
He emphasised that these were not fundamental changes, and did not aim to strengthen or weaken the criteria for application of the regime.
"The reforms strike an appropriate balance between the rights and interests of infrastructure owners and investors on the one hand, and the competition benefits of facilitating access on the other," he said.
The regime was aimed at promoting the efficient use of nationally significant infrastructure and to facilitate access in cases where replicating the infrastructure concerned would not be economical and where commercial negotiation with the infrastructure owner or operator has failed.
Minerals Council of Australia chief executive Mitch Hooke said the Federal Government needed to substantially reform the Act.
The latest announcement, while moving in the right direction, is a small step when a giant leap is needed," Hooke said.
"The confusion and uncertainty about the intent of Part IIIA needs to be remedied as a matter of urgency through the legislative process.
"Amendments should ensure that the shared use of infrastructure is only mandated in circumstances where the economic benefits of doing so unambiguously outweigh the costs."
Hooke said that this would ensure that:
Competition was substantially promoted as a result of any declaration;
Declarations only occurred in markets of national significance;
Declared services were truly essential to competition;
The production process exemption was better defined to reflect modern integrated supply chains;
There was a mechanism in place for a more thorough and independent assessment of the costs and benefits of granting third party access.
"There is a real danger that declarations under Part IIIA of the Trade Practices Act become the rule rather than the exception as was originally envisaged in the Hilmer Report and that in the process future investment in critical infrastructure will be significantly stymied," Hooke said.
Legislation is expected to be introduced into Parliament mid-year.
Source: Lloyds List Daily Commercial News - www.lloydslistdcn.com.au