Access to Essential Facilities
The Competition Policy Reform Act 1995, following recommendations of the Hilmer Committee in 1993, introduced a formal system of access to essential facilities. This is provided for in Part IIIA of the CCA and more recently a separate system of access to telecommunications facilities has been established. In relation to Part IIIA, access is available when the relevant minister declares a particular facility. The regime was reviewed in 2009 with the aim of improving 'the efficiency, timeliness and effectiveness of regulatory decision-making' which led to the passing of the Trade Practices Amendment (Infrastructure Access) Act 2010 on 24 June 2010.
In October 2012 the government announced an Inquiry into the National Access Regime. This Productivity Commission reported to the Government in October 2013 and the report was released in February 2014. The Final Harper Report has also made recommendations relating to access. See reports section, below.
The core access provisions are contained in Part IIIA
The Tribunal in In the Matter of Fortescue Metals Group Limited  ACompT 2 described the access regime as follows (para 3 of the summary of decision):
'The process for seeking access involves two stages. The first stage is to apply for the service to be “declared”. If the service is declared, the second stage involves the third party negotiating access terms with the owner. If no agreement is reached, the Australian Competition and Consumer Commission (ACCC) can resolve any dispute by arbitration, subject to any appeal to the Tribunal.'
Five criteria need to be satisfied before a service can be validly 'declared'. These are set out in s 44H(4) and require:
- (a) access would promote a material increase in competition in at least one dependent market;
- (b) it would be uneconomical for anyone to develop another facility to provide the service;
- (c) the facility is of national significance having regard to size, importance to trade or commerce or importance of the facility to the national economy;
- (e) it is not already subject to a certified access regime and
- (f) that access, or increased access, to the service would not be contrary to the public interest
In the Fortescue matter one of the key issues related to criterion (b) which requires that it be 'uneconomical for anyone to develop another facility to provide the service'. The NCC and Minister had applied a 'net social benefit' test to this assessment. The and Tribunal had adopted a variant of this - the natural monopoly test. This was challenged by Rio Tinto (which owned the relevant infrastructure), who appealed the matter to the Federal Court and subsequently to the High Court. The High Court (Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal  HCA 3) rejected the 'net social benefit' and 'natural monopoly' tests' in favour of a 'private profitability' test and remitted the matter back to the Tribunal to determine based on the correct test. The Tribunal concluded (in Applications by Robe River Mining Co Pty Ltd and Hamersley Iron Pty Ltd  ACompT 2 that there was insufficient evidence to satisfy the this test and overturned the Ministerial declaration.
It is now 20 years since the Hilmer Report, which provided the genesis for the current access regime. In October 2012 the government announced an Inquiry into the National Access Regime to be conducted by the Productivity Commission; that inquiry is currently underway and will consider, among other factors, 'whether the criteria for declaration strike an appropriate balance between promoting efficient investment in infrastructure and ensuring its efficient operation and use'. Thirty-one submissions were made and the PC released a draft report in late May 2013. The final report was submitted to the Government in October 2013 and was released on 11 February 2014. See report page.
On 9 May 2016 the ACCC released draft Part IIIA access undertaking guidelines for public comment. Three submissions were received and the ACCC subsequently published final guidelines:
A specialist telecommunications regime is also in place. The Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Act 2010 made changes designed to streamline the access and anti-competitive conduct regimes in Parts XIB and XIC of the Competition and Consumer Act 2010.
On 11 August 2016 the ACCC released guidelines relating to declaration provisions for telecommunication services under Part XIC
See reading room
Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal  HCA 36 [external link - remitting matter to Tribunal]
- In the matter of Fortescue Metals Group Limited  ACompT 2 [original challenge to Minister's declaration]
- Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal  FCAFC 58 (4 May 2011) [external link]
Appeal to Federal Court from Tribunal's original decision]
- Applications by Robe River Mining Co Pty Ltd and Hamersley Iron Pty Ltd  ACompT 2 [external link: Tribunal decision of 8 February 2013 following remission by the High Court - set aside Minister's declarations]
- NCC Page on Third Party Access to Pilbara rail lines
Part XIC - Telecommunications access
National Access Regime
Productivity Commission Inquiry into the National Access Regime
Referred to the PC by Assistant Treasurer, Stephen Bradbury, in October 2012
Issues Paper released on 30 November 2012. Submissions due on 8 February 2012
Draft report due May 2013; Final Report due October 2013
Final report released February 2014
Competition Policy Review (Harper Review)
The Harper Review Final Report, released on 31 March 2015, has made recommendations in relation to Access. In particular, recommendation 42 states:
Recommendation 42 - National Access Regime
The declaration criteria in Part IIIA of the CCA should be targeted to ensure that third-party access only be mandated where it is in the public interest. To that end:
- Criterion (a) should require that access on reasonable terms and conditions through declaration promote a substantial increase in competition in a dependent market that is nationally significant.
- Criterion (b) should require that it be uneconomical for anyone (other than the service provider) to develop another facility to provide the service.
- Criterion (f) should require that access on reasonable terms and conditions through declaration promote the public interest.
The Competition Principles Agreement should be updated to reflect the revised declaration criteria.
The Australian Competition Tribunal should be empowered to undertake a merits review of access decisions, while maintaining suitable statutory time limits for the review process.