Editorial: How can Botany admit competition concerns yet Newcastle's handcuffs not be 'anti-competitive'?

In the end, it was very little.

The public has only had since midday yesterday to comprehend its details, but Justice Jayne Jagot has laid out comprehensive and multiple grounds in favour of Botany and Kembla operator NSW Ports, and the state government.

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They are not grounds, however, that will sit easily with many in the Hunter Region who have followed this saga from its start more than 20 years ago.

In the first instance, Justice Jagot found the government was not carrying on a business when it privatised the ports, so was immune from the relevant competition laws. NSW Ports had "derivative immunity" - protection that flowed from the government's immunity.

So there was no case to answer.

But in case, as Justice Jagot wrote, her conclusions were incorrect, she analysed the Newcastle container terminal in what could be described as its real-world setting.

This section took up three-quarters of the decision, weighing the evidence of various witnesses and considering government policies and legal precedents.

Not only was a Newcastle terminal uneconomic and non-viable, Justice Jagot said it would be so even without the confidential penalty payments built into port privatisations.

Then, while accepting the NSW Ports consortium was concerned at competition from Newcastle when bidding for Botany and Kembla, Justice Jagot found the confidential deeds requiring Newcastle to compensate Botany were put in place to maximise government profit, not to stifle competition.

She said "nothing" in the compensation provisions supported the view that either the government or NSW Ports had "a substantial purpose" to "prevent or hinder" a Newcastle terminal, and there was no intention to "substantially lessen competition".

In its evidence, NSW Ports was similarly dismissive of a Newcastle terminal's viability.

If that's the case, then there should be no problem with agreeing to lift penalty - put in the judgement at $85 a container - and allowing Port of Newcastle to maximise its commercial potential, freely.

Without a strong response, a long hoped-for diversifying development may disappear.

Read the full Federal Court verdict here

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