The Federal Court of Australia has upheld the acquisition of the Acacia Ridge intermodal terminal by Pacific National.
In a judgement delivered on May 6, the Full Court of the Federal Court dismissed an appeal by the Australian Competition and Consumer Commission (ACCC) against the sale of the terminal by Aurizon to Pacific National and upheld Pacific National’s cross appeal.
The appeal is the latest in a long-running legal process since the $205 million sale was announced in 2017. After the sale was announced, the ACCC blocked the sale and commenced legal action to prevent Pacific National from purchasing the terminal. A Federal Court challenge in July 2018 led to the Court dismissing the ACCC’s challenge. Subsequently, the ACCC appealed to the Full Court of the Federal Court.
The Federal Court has now found that the sale does not breach the Competition and Consumer Act. In addition, the court found that the undertaking that Pacific National agreed to, that would increase competition, was unneeded. In a statement, Pacific National welcomed the court’s decision.
“Pacific National welcomes today’s judgment and is looking forward to adding the Acacia Ridge Terminal (south of Brisbane) to its nationwide network of efficient rail freight depots, terminals and hubs.”
Aurizon also welcomed the court’s findings.
“Aurizon welcomes the certainty delivered by the Court today – for our business, our employees and our shareholders. It is almost three years since the sale of the Terminal was announced in August 2017 and two years since the ACCC initiated proceedings in the Federal Court in July 2018,” the company said in a statement.
ACCC chair Rod Simms said that the case would be looked at for what effect it has on mergers in Australia.
“We will now carefully consider the Full Court’s judgment. The ACCC will continue to consider what changes are needed to make Australia’s merger laws work in the way they need to, to safeguard the economy from highly concentrated markets.”
In the earlier Federal Court proceedings, Pacific National had unconditionally offered to not discriminate in providing access to other rail operators. The ACCC rejected this undertaking, however the court found in 2019 that the offered undertaking would have the effect of enabling competition. The ACCC had then appealed the decision based on the Court’s acceptance of the undertaking.
“Pacific National is actively working to ensure the many social, environmental and economic benefits of rail freight are realised throughout Australia’s transport supply chain, including the future Melbourne to Brisbane Inland Rail,” said Pacific National in a statement.