Members of the global supply chain are asking the EU to scrap competition law exemptions for container lines
The profit of the shipping industry in 2021 exceeded $186 billion.
Ten different industry organizations representing the interests of cargo owners and freight forwarders, port terminal operators and other supply chain participants who depend on container transport have asked the European Commission to review the EC regulation on the application of the rules for the application of the block exemption of consortia in the maritime container transport industry. This was announced by the ETA association, which unites European towing business operators.
The statement said the regulation frees liner container carriers from many of the checks and balances of EU competition law and allows them to share confidential commercial information with each other to manage the number and tonnage of vessels involved, and the frequency and timing of international container services.
European companies and other members of the supply chain have faced major disruptions in the movement of cargo by container carriers since the last amendment to the regulation in April 2020. Many flights were canceled or diverted to other ports, and port "passes" were reported too late. At the same time, delivery rates on many routes have quadrupled or more.
"The introduction of lockdowns negatively affected the production of goods and the shift in demand due to the consequences of the pandemic. However, the ability of the shipping industry to collectively cope with these consequences and generate a substantial profit of more than $186 billion in 2021 at the expense of the rest of the supply chain and ultimately at the expense of European consumers shows that it is not all smooth sailing. The benefits of the general competition law exemptions enjoyed by the major shipping lines are distributed inequitably between them and the rest of the economy, and this is a compelling reason why the 'block exemption' should be urgently reviewed," the statement said.
The letter to the European Commission refers to the recommendations of the investigations carried out in the USA by the Federal Maritime Commission (FMC). As a result of their results, a new maritime shipping reform law was adopted in May, which is aimed at eliminating many user and service provider complaints against container liners.
The review of the regulation will allow all interested parties to provide evidence and arguments on how the European Commission should act to ensure that the ocean container transport market operates fairly and transparently for all players in the maritime supply chain. This should include consideration of new measures and mechanisms with sufficient time for their implementation before the expiration of the current regulation in April 2024, the association concludes.