Landside transport operators across Australia are appalled by the latest announcement by DP World Australia of further massive increases in vehicle booking fees and Infrastructure Access Charges from 1 January 2019.
“If these exorbitant fee increases are allowed to proceed, then since April 2017, DP World Australia will have imposed Infrastructure Charge increases levied on transport operators of 1024% in Melbourne, 247% in Sydney and 86% in Brisbane, with no negotiation, no transparency, and no ability for transport operators to resist, least their terminal access may be denied,” said CTAA director Neil Chambers.
In addition, Vehicle Booking System (VBS) fees will be jacked up 88% from $6.89 per container slot to $12.95, again with no consultation or discussion with transport operators about what the additional revenue will be used for to improve the truck interface at DP World terminals around Australia.
Unfair contract terms
The CTAA has raised with the ACCC previously, and with the federal and state governments, that DP World imposes these fee increases through unfair contract terms.
At the beginning of each financial year, DP World requires container road transport operators to accept the terms of its National Carrier Access Agreement. If they do not sign, transport operators may be denied terminal access, and in any event, as soon as they use the 1-Stop VBS from 1 July each year, they are deemed to have accepted the terms of the agreement.
The DP World Public Tariff Schedules for each terminal, linked to the Access Agreement, are also published for the financial year.
“The National Carrier Access Agreement forms a ‘contract’ between DP World and transport operators, albeit transport operators have little ability to negotiate fair terms within the contract,” observed Mr Chambers.
“Yet, half-way through the contract, DP World can vary its fees and charges massively, again with no negotiation.
“CTAA has asked the ACCC previously why this isn’t deemed to be ‘unfair contract terms’ under the provisions of Australia’s competition laws? Following this latest fee increase bombshell, we’ll be asking the question again.
“Transport operators have no say in setting these fees and charges, no say in their quantum, and no say in how the revenue is spent. How is this fair or sustainable?”
Federal & state government actions
The current Federal Minister for Infrastructure, Transport & Regional Development, Michael McCormack has stated publicly that he will wait for the next ACCC Container Stevedoring Monitoring Report due in October before considering action on stevedore fees and charges now being directed to the landside sector.
“We’ll be encouraging the Minister to act swiftly once the Monitoring Report is released.”
Similarly, both the Victorian and NSW governments have recently released updated strategic freight plans with clear directions to support the efficiency and viability of the container logistics freight sector.
In the case of the Victorian Freight Plan, there is a specific initiative to investigate options for the future role of government in regulating pricing/charges, and access to and from the Port of Melbourne.
“CTAA is encouraging Victorian Minister Luke Donnellan, NSW Minister Melinda Pavey, and indeed the Palaszczuk Queensland Government and the McGowan WA Government, to conduct these investigations as a matter of urgency, jointly or severally.”
The CTAA believes these government regulatory reviews need to address:
- The relationship between stevedore rates to shipping lines, terminal handling charges (THC) applied by shipping lines to shippers, and the implementation and quantum of the infrastructure surcharges levied by the stevedores on transport operators.
- An investigation of the ‘unfair’ structure of DP World’s National Carrier Access Agreement, and the benefits that would be derived by negotiated, individual service level agreements (SLA) between transport operators and stevedore companies.
- The establishment of independent monitoring of key stevedore performance indicators, similar to the analyses conducted in NSW under its Mandatory Standards regime by the NSW Cargo Movement Coordination Centre, including accurate Truck Turnaround Time (TTT) & Container Turn Time (CTT) measurement in all ports; VBS slot capacities per time zone; truck utilisation rates, stevedore practices that limit ‘two-way running’ opportunities; and stevedore infrastructure expenditure that improves landside logistics interface performance.