ACCC backs junior iron ore push for rail access

By Sineva Toevai and Jennifer Perry

The Australian Competition and Consumer Commission (ACCC) granted conditional approval to Atlas Iron, Brockman Resources and Ferraus, collectively known as North West Iron Alliance, to negotiate terms such as rail access pricing with BHP Billiton, Rio Tinto and Fortescue Metals.
“The ACCC considers that collective negotiations are likely to result in some transaction costs savings compared to a situation where the producers seek to negotiate individually with the service providers,” ACCC chairman Graeme Samuel said.
The ACCC noted that participation was voluntary for both iron ore producers and the service providers.
NWIOA chief executive Tony Considine said the ACCC’s willingness to grant NWIOA interim collective bargaining authorisation, which is effective immediately, indicated that the regulator was “conscious of the urgency” associated with proposed negotiations to secure a viable and cost effective end-to-end rail transportation solution for the alliance and its shareholders.
“This is a victory for the junior iron ore community in the Pilbara, as it clears the way for substantive negotiations with the incumbent rail infrastructure owners,” Considine said.
Considine said the onus was “now on the rail infrastructure operators” to respond to the ACCC’s interim authorisation and engage in meaningful negotiations with NWIOA on the crucial issues of the provision of rail transportation services.
BHP and Rio have long held fundamental objections to the sharing of their rail networks with third parties.

The ACCC’s draft determination is available at: www.accc.gov.au/AuthorisationsRegister