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ACCC green lights cooperation between supply chain rivals

rivals

Trucking and rail companies have been given special permission to work together to ensure supplies of food and other goods reach consumers in Western Australia and the Northern Territory.

Acting on an application from Linfox, the Australian Competition and Consumer Commission (ACCC) has granted an urgent interim order allowing companies involved in the supply chain to cooperate and share information.

Without the order, which is now in place until August, such cooperation could constitute a breach of Australian Competition law, the ACCC said in a statement today.

The interim authorisation does not extend to any agreements in relation to the price of any goods or services

The application follows storms and flooding in parts of South Australia which interrupted rail and road networks, limiting the supply of critical goods, including groceries, to WA and the NT.

Although the trains are now operating again, it is anticipated that it will take a number of weeks to clear the backlog of products caused by the disruptions.

“The ACCC’s interim authorisation allows supply chain participants, such as the rail and freight handlers and trucking companies, to co-operate to address the destructive effects of the recent storm on the Trans-Australian railway and potential shortages of both retail and critical products in WA and the NT,” ACCC deputy chair Mick Keogh said.

The authorisation application applies to a number of participants including Linfox, Pacific National, One Rail and major grocery retailers. It also could apply to a broader range of participants including, retailers, wholesalers or other transport services suppliers who follow the notification procedure.

With the interim authorisation, the participants are able to meet to identify which retail products are critically required in WA and NT and prioritise the supply by road, rail, sea or air freight into WA, including the developing of stockpiles if required.

The interim authorisation also allows parties to work together to identify and ensure critical products from WA and the NT are supplied to other jurisdictions.

“There is a risk of critical shortages of retail products in WA being compounded by a possible rise of Covid-19 cases that might affect workers in the transport, logistics and retail industries,” Keogh said.

“Allowing this authorisation will likely result in public benefits by giving those in the supply chain the opportunity to maximise consumer access to retail groceries, reduce community concerns, and reduce strain on retail supply chains.

“This ACCC decision also helps limit critical shortages and supply chain issues elsewhere in Australia by granting interim authorisation to cooperate on ensuring exports can leave WA.”

In a media statement yesterday, WA Transport Minister Rita Saffioti thanked truckies for helping “keep our freight and supply moving through this unprecedented event”.

Crews had been working around the clock to fix the damage.

Other measures undertaken included:

  • Working with Pacific National and Linfox to create a ‘land bridge’ with freight transported by triple road trains from Adelaide to Kalgoorlie via the Eyre Highway. Once at Kalgoorlie, containers were loaded onto freight trains and hauled into Perth.
  • Worked with the National Heavy Vehicle Regulator to allow triple road trains to use Eyre Highway and access Kalgoorlie directly. As of Sunday, 55 triple road trains (53.5 metres) have used these exemptions to bring essential goods across the Nullarbor.
  • Allowed double road trains (36.5 metres) to travel directly from Northam into Perth via Greenmount Hill with a safety escort – 43 double road trains have entered Perth via this route.

Woolworths have also utilised the option to ship goods to Western Australia, with the first ship having left Sydney on February 8 and due to arrive at Fremantle Port by February 22.

The shipping option is anticipated to bring in more than 3,500 additional pallets of goods into Fremantle.

Deliveries will be able to be made to supermarkets 24/7, under planning law changes made in 2020, which will help ease some of the backlog of supply, added Saffioti.

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