Short sea shipping services’ regulations in the Gulf of Naples urge to be re-issued
The Antitrust Authority asked Campania Region to replace 2016 regulatory scheme which neither improved market competition nor the quality of services
By lodging an appeal named ‘Competition problems in short sea services from, among and to smaller islands’ the Antitrust Authority suggested Campania Region “to revise 2016 framework regulations aimed at ensuring the fair and substantial enforcement of the European short sea services’ rules”.
As demanded by the Authority, Campania region will have to illustrate “their decision to overcome competition hindrances within 60 days”.
The affair particularly relates to competition problems affecting shipping services in the Gulf of Naples even after the issuance of 2016 regulation through which the Region approved a new scheme to arrange short sea shipping services turning down adjudication through regular tender.
The scheme, pivoting on an authorization regime, envisaged the compliance with some rules which essentially include: the most appealing time-scheduling for the region, the quality of services characteristics to be provided, and compliance with regional fares.
A new regulatory scheme which in fact didn’t provide substantial changes in market competition in the Gulf, considering that, according to the Antitrust, “the same services continue being offered by incumbent shipowners, particularly Snav and Alilauro group, without introducing new operators”.
Despite umpteenth complaints submitted by consumers, the new scheme neither upgraded the quality nor introduced new fares”, added Agcm, while pinpointing that “major hindrances ensued from a formal rather than substantial enforcement of EU regulations and principles governing short sea shipping.
In essence, the Antitrust Authority recalls that, before enforcing public service obligations, the competent public authority, should evaluate adequate market prerequisites in order to provide the same services at fair market conditions, not only without compensation but also without hurting operators’ pricing policies.
“Exclusively in duly substantiated market failures the public administration can urge public service obligations”.
According to the Antitrust, the new framework regulations approved by Campania Region is inadequate in a fair market competition, being grounded on the pure disruption of a public service without having previously undertaken a preliminary market assessment to evaluate overall demand, particularly considering all individuals holding territorial continuity’s rights and implementing adequate measures to meet such demand”.
On the one hand there might be suitable conditions to provide short sea services in a market regime, while on the other hand the minimum compulsory public services should be clearly identified in order to essentially meet local residents’ requirements.
The Region helmed by Vincenzo De Luca “should rapidly take due actions to carry out the afore mentioned evaluation instead of, as intended by DGR n.1/2016, waiting for the amendment of former nine-year public service contract sealed with Caremar”, due to expire in 2024.
The Authority, pro-tempore helmed by Gabriella Muscolo, also adds that “Caremar Spa was taken over by the major operator serving the Gulf of Naples, Snav; the latter company can essentially adopt opportunistic behaviours, cutting down the services operated on behalf of Caremar for which they receive public subsidy, while enhancing their own services”.
In order to enforce the European Regulation governing short sea shipping services (n.3577/92) the Region should amend the new regulatory scheme to outline the services which can be provided in a fair competition market (without compensation and most of all without affecting operators’ pricing policies) and the ones which should be subject to public services obligations.
Finally the Antitrust also complains about the inadequate regulations governing port structures.
The public administration must evaluate whether the available infrastructures, hosting these services, are fairly available for any new operators and not only for incumbent ones”, states Agcm, adding that “on the other hand, introducing a pure authorization regime, nonetheless ruled by fare obligations, does not correspond to a fair market regime but prevent setting out the most adequate rules to ensure local residents’ mobility“.
In essence, although the regulatory framework enforced in 2016 by Campania Region apparently better complies with EEC regulation n. 3577/92, according to the Antitrust it is exclusively the formal enforcement of community rules on short sea services.