BHP Billiton today announced it had challenged the legal basis for an application to the National Competition Council (NCC) by Fortescue Metals Group to have its iron ore railway lines in Western Australia declared as a service under Part IIIA of the Trade Practices Act (TPA).

In a detailed submission to the NCC, BHP Billiton said that section 44B of the TPA excludes any function which is properly a ‘production process’ from being declared a ‘service’.

As BHP Billiton’s rail lines are part of a fully integrated process by which the company produces marketable iron ore products, it believes that the NCC cannot properly deal with FMG’s application, or declare the rail lines.

BHP Billiton operates and manages the Pilbara iron ore rail systems on behalf of the Mt Newman and Goldsworthy Joint Ventures (BHP Billiton equity interest 85 per cent).