In 2007, significant vessel queues waiting to load coal at Australia’s largest coal export port in Newcastle became the most visible reference point in an ongoing public debate about the capacity of Australia’s export infrastructure. Those queues were symptomatic of capacity constraints affecting all major Australian coal chains, imposing substantial direct and indirect costs.

It is important in these discussions to make one’s premises clear. Mine are as follows: By infrastructure I mean long-lived physical assets that provide the basis or physical support on which most economic and social activities rely. While the scope of this definition can obviously vary, I use the term to refer to the conventional utility industries – such as communications, electricity, transport (including rail links, ports and airports), water and sewerage services – as well as to the road network.

It is finally being recognised that substantial parts of our infrastructure industries face serious capacity constraints. The factors behind this are complex.

The question of whether exclusive licensing of the right to provide harbour towage services in ports can provide a superior outcome to open competition has been among the questions that have recently preoccupied Australian policymakers.

This paper reviews the case of Stirling Harbour Services Pty Limited v Bunbury Port Authority as it was decided at first instance and then on appeal by the Federal Court. The paper looks at the questions, the main elements of the answers and some of the issues raised by the answers in this case.