Call issued for repeal of shipping antitrust regulation

Shippers and service providers say they are suffering from “an increasingly unbalanced market situation since carriers entered into major cooperation agreements.”    Nine organizations representing shippers, freight intermediaries and transporters said in a statement that they are calling for repeal of the European Commission’s Block Exemption Regulation (BER) that regulates liner shipping company consortia.
   Three best-known consortia — the 2M, Ocean Alliance and THE Alliance — dominate the major east-west container trades, including those between Europe and Asia and Europe and North America.
   Last year the EC noted the current BER will expire on April 25, 2020, and said it was evaluating its impact and relevance in order “to determine whether it should be prolonged and, if so, under which conditions.”
   The nine groups in a statement issued Tuesday said, “Market developments which occurred over the last five years justify an in-depth review of the regulatory framework as this has not been done since 2009.” 
   They added, “The current framework has become obsolete given that most of the carriers operate in alliances and that market concentration is increasing.
   “At the same time, an important condition for the exemption, which is to provide benefits to the customers, is no longer met, as neither service quality nor productivity have improved over the years. Instead, users of liner shipping services and their service providers have suffered from an increasingly unbalanced market situation since carriers entered into major cooperation agreements,” they said in a joint statement.
   The nine organizations are: Global Shippers Forum, European Shippers Council, European Association for Forwarding Transport, Logistics and Customs Services (CECLAT), European Boatmen’s Association, European Barge Union, European Skippers Organization, European Tugowners Association, Federation of European Private Port Companies and Terminals and International Union for Road-Rail Combined Transport.
   The group pointed to a report by the International Transport Forum of the Organization for Economic Co-operation and Development (ITF-OECD) from November titled The Impact of Alliances in Container Shipping that said, “The impacts of alliances on the containerized transport system taken as a whole seem to be predominantly negative.”
   The nine associations said they jointly conclude that the European Commission “should repeal the Consortia Block Exemption Regulation unless a revised regulatory framework clarifying the current BER is adopted. In this respect, some of the associations have already submitted their detailed positions to the European Commission or will do so shortly.”
   World Shipping Council, the major trade association for the container liner shipping industry, which provided its own statement to the EC last summer, said it had no comment on Tuesday’s statement beyond saying it was “presenting facts to the Commission and we don’t have anything to say about anyone else’s press release.”