Freight forwarders consolidate cargo every day. Assembling enough visible, committed demand to support a coastal service that does not yet run is a different problem.
The previous article argued that Australia should stop debating how much freight ought to move by sea and start identifying which freight realistically could. It ended on an awkward finding. Even where the cargo suits and the service would be credible, an individual shipper may not have enough contestable volume on a single corridor to change the economics of a sailing. The freight exists. It exists in pieces.
The obvious objection is that Australian freight already has an aggregation industry. Forwarders and consolidators combine consignments into full loads every working day. That is the business. But consolidation of that kind happens inside individual commercial pools, and it happens for services that already run. What a new coastal service would need is different: demand visible across many separate pools, on the same corridor, sustained long enough that someone would commit a vessel to it. Nobody is asked to do that, and nobody is obviously placed to.
My research pointed to one explanation. Participants described the coordination that pooling would require as commercially risky even to explore, and one senior respondent characterised it as a non-starter without an exemption. In my earlier series I reported that finding as I found it. Having since looked harder at the regulatory architecture, I think the explanation is more complicated than I made it sound, and it is worth saying so plainly.
Australian competition law does provide ways for competitors to coordinate lawfully. The simplest is a class exemption for collective bargaining, obtained through a one-page notice at no cost, but it is designed for small business and limited to firms below a ten million dollar turnover threshold. A notification process is nearly as cheap and is capped instead by the value of the transactions involved. Above those ceilings sits full authorisation, which carries no size limit at all and can be sought by a participating business or by an industry association on behalf of members. It is a formal, public, consultative process, and it takes months.
It is also used. In 2018 a group of rail freight operators was authorised to negotiate collectively with Transport for NSW over the non-price terms of track access. They returned for a broader replacement authorisation, granted in 2024 and running to 2033 across a wider set of network owners. Substantial freight businesses can and do use this pathway. I would not push the precedent further than it goes: bargaining collectively with a monopoly infrastructure owner is not the same conduct as pooling dispersed cargo to bring a service into existence, and it would not attract the same assessment.
What the precedent does establish is that the legal pathway was never the whole story. Two things sit behind it. The first is that those rail operators were already an identifiable group, with a common counterparty and a shared problem. They knew who they were before they sought permission to act together. Coastal freight aggregation begins a step earlier, among parties who do not know which of their competitors holds contestable freight on the same run. It is difficult to seek permission to behave as a group before the group exists.
The second is more fundamental. Each of these processes does one thing: it grants exemption from competition law. None of them can impose an obligation on anybody. Approval to talk is not a service, a committed volume or a sailing schedule. This is where Part X is instructive as a contrast rather than a model, whatever one thinks of its future. The exemptions it extends to international liner operators arrive tied to minimum service obligations. Permission and reciprocal obligation sit together. In the general pathways, permission sits alone.
So the missing function is narrower than I once described it, and harder than it sounds. It is not aggregation, which the market performs daily and performs well. It is making latent demand visible across commercial boundaries at corridor scale and then converting that visibility into commitments that cargo owners and a carrier would each be prepared to sign.
Competition law can make collaboration lawful. It cannot make collaboration happen. What might be the subject of the final article.
Susan Oommen has submitted her doctoral thesis at the University of Tasmania (Australian Maritime College) on barriers to shifting road cargoes to sea in Australia. This is the second of three articles drawing on her national-level survey, stakeholder data and the freight mode-choice literature.
Editors’ note: Shipping Australia publishes a variety of articles from several sources for the purposes of information provision and for providing insight to our readers. Publication of a third party-supplied article in our newsletter or on our website should not by itself be viewed either as an endorsement or refutation of any particular viewpoint or policy position by Shipping Australia.
