The Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal

• Jurisdiction: Australia Federal only
• Judge: French CJ,Gummow,Hayne,Crennan,Kiefel,Bell JJ.,Heydon J.
• Judgment Date: 14 September 2012
• Neutral Citation: 2012-0914 HCA B,[2012] HCA 36
• Court: High Court
• Docket Number: Matter No M155/2011 Matter No M45/2011 Matter No M46/2011
• Date: 14 September 2012

[2012] HCA 36

HIGH COURT OF AUSTRALIA

French CJ, Gummow, Hayne, Heydon, Crennan, Kiefel And Bell JJ

Matter No M155/2011

Matter No M156/2011 & M157/2011

Matter No M45/2011

Matter No M46/2011

The Pilbara Infrastructure Pty Ltd & Anor

Appellants

and

Australian Competition Tribunal & Ors

Respondents

The Pilbara Infrastructure Pty Ltd & Anor

Appellants

and

Australian Competition Tribunal & Ors

Respondents

The National Competition Council

Applicant

and

Hamersley Iron Pty Ltd & Ors

Respondents

The National Competition Council

Applicant

Robe River Mining Co Pty Ltd & Ors

Respondents

Representation

J T Gleeson SC and C A Moore SC with M I Borsky for the appellants in M155/2011, M156/2011 and M157/2011, for the twelfth and thirteenth respondents in M45/2011 and for the tenth and eleventh respondents in M46/2011 (instructed by DLA Piper Australia)

S J Gageler SC, Solicitor-General of the Commonwealth with P J Hanks QC and J P Slattery for the applicant in M45/2011 and M46/2011 and intervening on behalf of the National Competition Council in M155/2011, M156/2011 and M157/2011 (instructed by Clayton Utz Lawyers)

N J Young QC with P W Collinson SC and S H Parmenter for the second to tenth respondents in M155/2011, for the second to eighth respondents in M156/2011 and M157/2011, for the first to ninth respondents in M45/2011 and for the first to seventh respondents in M46/2011 (instructed by Allens Arthur Robinson)

A C Archibald QC with M H O'Bryan SC for the eleventh and twelfth respondents in M155/2011, for the ninth and tenth respondents in M156/2011 and M157/2011, for the tenth and eleventh respondents in M45/2011 and for the eighth and ninth respondents in M46/2011 (instructed by Ashurst Australia)

Submitting appearance for the first respondent in M155/2011, M156/2011 and M157/2011, for the fourteenth respondent in M45/2011 and for the twelfth respondent in M46/2011

Trade Practices Act 1974 (Cth), Pt IIIA, ss 44B, 44F, 44H, 44K, 163A.

The Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal

The Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal

The Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal

The National Competition Council v Hamersley Iron Pty Ltd

The National Competition Council v Robe River Mining Co Pty Ltd

Trade practices — Access to services — Minister's decision whether to declare services relating to railway lines in Pilbara pursuant to s 44F of Trade Practices Act 1974 (Cth) — Section 44H(4) required Minister to be satisfied of certain matters — Whether criterion for declaration of service in s 44H(4)(b) imposes test of private profitability — Whether public interest criterion in s 44H(4)(f) requires or permits inquiry into likely net balance of social costs and benefits — Whether any residual discretion.

Administrative law — Application to Australian Competition Tribunal (‘Tribunal’) under s 44K for review of Minister's decision to declare pursuant to s 44F — Review by Tribunal is re-consideration of the matter — Nature of review to be undertaken by Tribunal — Whether Tribunal could consider any material parties considered relevant.

Words and phrases — ‘public interest’, ‘re-consideration of the matter’, ‘re-hearing of the matter’, ‘uneconomical for anyone to develop another facility to provide the service’.

1 French CJ, Gummow, Hayne, Crennan, Kiefel And Bell JJ. Iron ore mined in the Pilbara region of Western Australia is transported by train to ports at Dampier, Cape Lambert and Port Hedland. There it is loaded on to ships and exported from Australia.

2 BHP Billiton Ltd (‘BHPB’) and Rio Tinto Ltd (‘Rio Tinto’), two of the world's largest iron ore producers, conduct mining operations in the Pilbara. The details of the corporate structures through which BHPB and Rio Tinto conduct these operations need not be noticed. It is enough, for present purposes, to refer compendiously to BHPB and Rio Tinto.

3 BHPB operates two railway lines which carry the ore mined by BHPB to port: the Goldsworthy line and the Mt Newman line which each terminate at Port Hedland. Rio Tinto operates two other railway lines which carry the ore mined by Rio Tinto to port: the Hamersley line which terminates at Dampier and the Robe line which terminates at Cape Lambert.

4 Fortescue Metals Group Ltd (‘FMG’) also conducts mining operations in the Pilbara. It wants access to the railway lines and associated infrastructure that BHPB and Rio Tinto own and use. Whether it would take up that access and on what terms access would be made available are questions that do not now arise.

5 Part IIIA of the Trade Practices Act 1974 (Cth) (now called the Competition and Consumer Act 2010 1) (‘the Act’) provides for the processes by which third parties may obtain access to infrastructure owned by others. The Act provides for a process by which a particular ‘service’ may be ‘declared’. A ‘service’ is defined 2 as:

‘a service provided by means of a facility and includes:

• (a) the use of an infrastructure facility such as a road or railway line;

• (b) handling or transporting things such as goods or people;

• (c) a communications service or similar service;

  but does not include:

• (d) the supply of goods; or

• (e) the use of intellectual property; or

• (f) the use of a production process;

except to the extent that it is an integral but subsidiary part of the service.’

6 Part IIIA of the Act also provides (chiefly in Div 3 (ss 44R-44ZUA), Div 4 (ss 44ZV-44ZY) and Div 6 (ss 44ZZA-44ZZC)) for a second, distinct stage, following the declaration stage, in the processes for obtaining access to infrastructure: the making of agreements or arbitrated determinations regulating the terms on which a third party may have access to a declared service. Because there are still disputes about whether the relevant services should be declared, no step has yet been taken under this second stage of the processes for obtaining access to any of the four railway lines owned and operated by BHPB and Rio Tinto. The appeals to this Court concern only the first stage of the processes for which Pt IIIA provides: should any of the services be declared?

The process for declaration of a service

7 The process for declaration of a service proceeds by at least two steps: first, a recommendation made 3 by the National Competition Council (‘the NCC’) that a particular service be declared and second, a decision 4 by the ‘designated Minister’ to declare the service.

8 The NCC is established by s 29A of the Act. Its functions include 5:

A person may not be appointed to the NCC unless the Governor-General is satisfied 6 (among other things) that ‘the person qualifies for the appointment because of the person's knowledge of, or experience in, industry, commerce, economics, law, consumer protection or public administration’.

• ‘(a) carrying out research into matters referred to the Council by the Minister; and

• (b) providing advice on matters referred to the Council by the Minister.’

9 At each of the two steps for declaration of a service (recommendation by the NCC and decision by the Minister to declare) the Act provides 7, and provided at the times relevant to these matters, that the decision maker must be satisfied of all of six specified matters:

• ‘(a) that access (or increased access) to the service would promote a material increase in competition in at least one market (whether or not in Australia), other than the market for the service;

• (b) that it would be uneconomical for anyone to develop another facility to provide the service;

• (c) that the facility is of national significance, having regard to:

  • (i) the size of the facility; or

  • (ii) the importance of the facility to constitutional trade or commerce; or

  • (iii) the importance of the facility to the national economy;

• (d) that access to the service can be provided without undue risk to human health or safety;

• (e) that access to the service is not already the subject of an effective access regime;

• (f) that access (or increased access) to the service would not be contrary to the public interest.’

10 In this Court attention focused principally on criteria (b) and (f). What does criterion (b) mean when it speaks of it being ‘uneconomical for anyone to develop another facility to provide the service’? What matters can be taken into account under criterion (f) when it requires the decision maker to be satisfied that access to the service ‘would not be contrary to the public interest’? And attention was also directed to a further question: if a decision maker is satisfied of each of the six matters stated in the Act, is there nonetheless a discretion to be exercised? If so, what are the criteria that inform the exercise of that discretion?

11 The Act provides for a further step in the process for declaration of a service, beyond the making of a recommendation by the NCC and a decision by the Minister. If the Minister decides (or is deemed to decide 8) not to declare a service, the person who applied for the declaration recommendation may apply 9 for review of the Minister's decision by the Australian Competition Tribunal (‘the Tribunal’). And if the Minister declares a service, the provider of the service may apply 10 for review of the declaration by the Tribunal.

12 Decisions made by the Tribunal on a review of a ministerial decision to declare or not to declare a service are amenable to judicial review in the Federal Court of Australia on application under the Administrative Decisions (Judicial Review) Act 1977 (Cth) (‘the ADJR Act’) or s 39B of the Judiciary Act 1903 (Cth) or on application for declarations and orders (including orders by way of, or in the nature of, prohibition, certiorari or mandamus) under s 163A of the Act.

13 The present appeals to this Court and the associated applications for...