Container alliances: supporters and opponents take a position
EU Commission's consultations to determine whether lengthening the Consortia Block Exemption regulation have been completed: Assarmatori, Federagenti, Fedespedi, Confetra, ECSA and ICS commented the affair
The window opened by the European Commission regarding the lengthening of the Consortia Block Exemption Regulation, which consents containers shipping operators to seal alliances as an exception to standard community antitrust law.
As already known the current framework will expire in April 2020 and by that time the Commission will have already established if and how it should be extended.
The International Transport Forum (OCSE) recently issued a report signed by Olaf Merk, Lucie Kirstein and Filip Salamitov which reject current system because it affects the variety of shipping services and worsen carriers' offer, essentially affecting market stability, hurting port terminals, carriers and minor shipping lines.
Also Fedespedi, Confetra and Clecat, European Association for Forwarding Transport, Logistics and Customs Services, rejected the unconditional extension, adding that the European Commission should issue “clear and transparent guidelines and control this sector” to prevent illegal behaviours which might favour shipping companies seriously hurting ports, terminals and the whole logistic chain”,
According to President Roberto Alberti the current scheme fostered the foundation of three alliances operating as a cartel “an unbearable occurrence” which essentially hurt cargo “increasingly affect choice opportunities and often provide low quality services in terms of transit time, efficiency and suppleness”.
Alberti asked the EU to control the situation in order to “guarantee fair competition in shipping sector”, as already asked for by Confetra.
Even the Association's President, Nereo Marcucci, confides that the European Commission would act as a fair antitrust authority.
Marcucci stated he has no prejudice against the extension, provided the related benefits can be proven and measured.
ECSA (representing European shipowners), ASA (gathering the Asian ones), ICS (International Chamber of Shipping) and World Shipping Council submitted their considerations to the Commission (the document can be read here), listing all advantages granted by the alliances: VSA (vessel sharing agreement) are a key element in containers shipping network structure, the Consortia Block Exemption Regulation provided, since 1995, a transparent legal scheme regarding VSA given companies operating to/from European ports; despite the recent mergers, this market sector still offers high competition, charging 50% lower freight rates versus 20 years ago; finally the exemption helps cut carriers and emissions.
Assarmatori and Federagenti support the exemption's extension, resuming the report they sent the European Commission.
According to Assarmatori and Federagenti, the alliances helped serving smaller ports, preventing cancellations or disruption of services, consented smaller companies to survive by providing slot agreement services through competitors, advantages which favoured cargo and carriers.
Finally, unlike reported by Fedespedi, Assarmatori and Federagenti believe that “shipowning alliances have no relation and do not affect the rationalization of services which is currently featuring logistics and transport market ashore”.