The competition watchdog is worried Aurizon's planned sale of its Queensland intermodal business would give Pacific National a stranglehold on freight haulage in the region.
Australian Competition and Consumer Commission chairman Rod Sims says the proposed sale to a consortium of Pacific National and Linfox would make Pacific National the only operator of its kind to and from far north Queensland.
"We are concerned the proposed acquisitions would lead to increased prices and reduced service for freight hauled between Brisbane and far north Queensland," Mr Sims said in a statement of issues released on Thursday.
The ACCC is concerned about Pacific National's proposal to acquire the Acacia Ridge terminal in a $220 million deal because of the power that would give the buyer against any potential freight rival.
But Aurizon on Thursday reiterated that it would close the Queensland Intermodal business if the sale is blocked.
"Any closure of the business would likely occur by the end of 2018 and would result in the loss of up to 350 jobs throughout Brisbane and regional Queensland," Aurizon said.
"Closure would also be likely to affect rail services and rail line haul capacity in Queensland, potentially causing disruption to freight import and export supply chains."
Aurizon is aiming to exit the container freight business to increase its focus on its growing coal division, and said it remained committed to finalising the deals by July.
It said it would make detailed submissions to the ACCC addressing the issues raised by the watchdog.
Aurizon shares were steady at $4.40 at 1545 AEDT.
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