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ACCC: Coal trading quotas banned

THE Australian Competition and Consumer Commission (ACCC) last week put a temporary ban on coal p...

Angie Tomlinson

The amendment was made on Wednesday to the capacity distribution system proposed by Port Waratah Coal Services. The system, whilst deemed anti-competitive, is designed to reduce queues and demurrage costs.

The ACCC issued a draft decision in April proposing to grant authorisation and is currently consulting the Hunter Valley coal industry on its draft decision.

When the ACCC issued its draft decision, it also reconsidered the interim authorisation it granted on 5 March and allowed it to continue. However, the ACCC was not previously made aware that it is possible for producers to sell allocations to one another.

"The ACCC considers that the ability for producers to sell allocation, rather than just being able to swap, is a potentially significant and contentious aspect of the system. It would like to consider it in more depth before deciding whether or not to allow it," said ACCC chairman Graeme Samuel.

The interim authorisation will continue until the ACCC issues a final decision on whether to grant substantive authorisation to the capacity distribution system. A final decision is due in June.

The ACCC were quick to emphasise last week’s decision did not necessarily mean selling allocation would not be authorised in the ACCC's final decision.

The capacity distribution system has been operating since the beginning of April under the interim authorisation granted by the ACCC.

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