Export

ACCC prompts rejig of contract terms for stevedoring trio

Grain Central, April 3, 2019

THREE container stevedore companies have amended their contracts with land transport businesses after the Australian Competition and Consumer Commission (ACCC) raised concerns that terms within their agreements may be unfair.

Port Botany in Sydney is a major export point for grains, meat and cotton produced in NSW. Photo: NSW Ports

The companies, DP World Australia, Hutchison Ports Australia and Victoria International Container Terminal (VICT) agreed, after the ACCC’s intervention, to remove or amend terms the ACCC considered were likely to be considered “unfair” within the meaning of the Australian Consumer Law.

“Thousands of transport businesses, which have standard-form agreements with DP World, Hutchison and VICT, stand to benefit from these changes,” ACCC Commissioner Sarah Court said.

“The handling of containers has a direct bearing on the cost of goods in Australia and the competitiveness of Australian exports, so it is crucial for businesses and consumers that the supply chain operates fairly and efficiently.”

DP World operates container terminals in the ports of Melbourne, Sydney, Brisbane and Fremantle, and has the greatest share of container stevedoring lifts in Australia, at 2.3 million lifts per year.

Hutchison operates container terminals in Brisbane and Sydney, and VICT operates a container terminal in Melbourne.

Agricultural commodities they handle include grain, pulses, cotton and meat.

The ACCC launched its investigation in early 2018 following concerns being raised about alleged unfair terms in contracts between container stevedores and land-transport operators, namely rail and trucking businesses.

DP World and Hutchison had contract terms that allowed a stevedore to unilaterally vary terms, including fees paid by land-transport operators, in agreements without notice.

The two also had terms which limited their liability for loss or damage suffered by the transport businesses, while not offering the transport businesses the same protections.

VICT’s contract had a term requiring transport businesses to indemnify VICT for loss or damage, with no reciprocal obligation on VICT.

DP World’s standard agreement also required the transport businesses to pay the stevedore’s legal costs and expenses in circumstances where such payments would normally be determined by court order.

The three stevedores cooperated with the ACCC’s investigation and agreed to remove or amend the terms.

Hutchison has made its commitments in a court-enforceable undertaking, and will also place a corrective notice on its website and put in place a compliance program.

Those contract terms which previously allowed the stevedore to amend the contract without notice have either been removed, or now require the stevedore to give 30 days’ notice of any changes, including for any price rises.

The ACCC’s 2018 Container Stevedore Monitoring Report noted the ACCC was assessing unfair contract terms within the industry. The ACCC has now concluded that assessment.

More than 7 million containers are handled at Australian ports every year.

Source: ACCC

 

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