INDUSTRY NEWS
The European and worldwide trading organizations are urging the European Commission to launch a comprehensive examination of its container shipping competition rules.
The stakeholders in the container shipping industry, including owners and forwarders of cargo, port terminal operators and other parts of the supply chain reliant on container shipping, are calling for an immediate start to the EU’s Consortia Block Exemption Regulation review.
The International Association of Movers (IAM) and FIDI Global Alliance as representatives of fellow international moving and relocation industry associations, including OMNI, LACMA, PAIMA, FIATA (International Federation of Freight Forwarders Association), UIRR (International Union for Road-Rail Combined Transport), ETA (European Tug owners Association), EBU (European Barge Union), Global Shippers Forum, ESC (European Shippers’ Council), FEPORT, and the CLECAT (European Association for Forwarding, Transport, Logistics and Customs Services) are all demanding an immediate start to the review of the European Union’s Consortia Block Exemption Regulation for the container shipping industry.
This Regulation allows container shipping firms to exchange commercially sensitive data in order to manage the number and size of vessels deployed and sailings’ timeliness on trade routes across the globe, which are not covered by EU competition rules.
Since the Regulation was last renewed in April 2020, EU businesses and other parties in the supply chain, such as FIDI Affiliates, have faced wide-ranging disruption to container shipping movement due to ports being skipped (‘skipped’) at short notice. At the same time, rates for many routes have increased by more than fourfold and continue to be 3-4 times higher than they were in 2019 before the epidemic.
Lockdowns had significant impacts on product production and demand fluctuations as a result of the Covid pandemic. The ability of the shipping sector to jointly manage these consequences while also earning more than $186 billion in year 2021, at the expense of the rest of the supply chain and eventually Europe’s consumers, reveals that something is wrong.
The shipping lines’ exemptions from general competition law are not being shared equally between the lines as well as with the rest of the economy, and this in itself is a compelling reason why the Block Exemption should be reviewed immediately.
The signatories of the letter, which were also addressed to the European Commission, cited several of the findings and recommendations from investigations undertaken by the Federal Maritime Commission in the United States, which resulted in the passage of a new Ocean Shipping Reform Act in May that addresses many of users’ and services suppliers’ complaints about container shipping lines.
The review of this Regulation will allow all interested parties to submit evidence and arguments as to how the Commission should act in order to ensure that the deep-sea container shipping market is fair and open to all participants in the maritime supply chain. This should take into account new measures and mechanisms, as well as sufficient time for these proposals to be considered and implemented before April 2024, when the present Regulation expires.
