Key points
- The Victorian Government has introduced a Bill which would require the Port of Melbourne Corporation ("PoMC") to pay the Government an annual Port Licence Fee ("PLF") of $75 million.
- The PoMC has already indicated that it would effectively pass on the PLF to shipping companies by increasing charges such as wharfage, channel fees and other charges.
- Shipping companies are likely to pass on the PLF to their customers, increasing costs to freight companies, importers and exporters.
- The PoMC has invited written comments from industry by 10 February 2012.
The Bill to impose a $75M fee on the PoMC
On 6 December 2011, the Victorian Government introduced the Port Management Amendment (Port of Melbourne Corporation Licence Fee) Bill ("Bill") into Parliament.
The Bill will replace the previously proposed Freight & Infrastructure Charge ("FIC"), which was to be a levy on trucks carrying import and export containers in and out of the Port of Melbourne. The FIC was opposed by trucking companies and key industry groups, including the Victorian Transport Association and the Customs Brokers and Forwarders Council of Australia.
The Bill proposes that the PoMC be required to pay the PLF annually to the Victorian Government at a rate of $75 million for the financial year beginning 1 July 2012. The PLF would increase annually by the Consumer Price Index in subsequent years.
The PoMC is likely to increase charges The PoMC's has released a series of six information papers and called for comments from industry. However, the PoMC has already indicated that its proposed approach will be to increase charges from 1 July 2012, including wharfage, channel fees and other charges. For channel fees, the increase will be applied to both Melbourne and Geelong users.
The PLF will result in higher supply chain costs for businesses. Some stakeholders have criticised the Victorian Government and argued that the PLF will affect the Port of Melbourne's competitiveness with other ports.
What can you do?
If you are concerned about the PLF or the PoMC's approach to the PLF, we can assist you in making a submission. We can also assist in ensuring that any additional charges can be passed to customers through terms and conditions.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.