CLECAT calls on the EU Commission to make a move and finally put containerised shipping companies under investigation

In the letter, CLECAT points out that European companies continue to be confronted with the rising costs of container shipping, with an exceptionally low level of reliability of these services as well as with the possibility of a limited choice of these services. The association also points out that the extraordinary rise in maritime freight in the last 18 months has the effect of harmful inflation and an increase in the cost of living in the EU, as recently reported by the OECD. CLECAT complains that 'the profits of ocean sea carriers from their capacity management strategies enabled them to acquire a market power and financial endowments that now are using for vertical integration, increasing tariffs and, in the downstream market, ousting shippers Independent. The new discriminatory conduct towards freight forwarders, who are the key organizers of the supply of services in all modes of transport in operations door-to-door - noted CLECAT - will ultimately benefit shippers and final consumers due to the limited choice of services and higher rates'.

With the letter, the association urges the European Commission to investigate urgently, under EU competition rules and in the context of the revision of the Exemption Regulation for category for liner shipping consortia (CFRs), effects on the market determined - explained CLECAT - "by combination of block exemption, leading to alliances and consortia that move capacity from one route to another, vertical integration, consolidation, control of data and the resulting dominant position on the market'.

'In particular,' CLECAT said, 'the Commission must investigate the exponential increase in freight rates that has allowed alliances to predict profits of over 200 billion dollars during the Covid crisis in the face of the absence of a any increase in their costs or any motivation attributable to the pandemic'.

CLECAT also specified that 'the combination of these factors have allowed the shipping companies, for the their long-term contracts, to selectively select the shippers handling the highest volumes and relegate others to the spot market where they will have to pay very much freight higher than those offered to the few favorites. In addition to this discriminatory strategy - denounced the association again - as part of this process, freight forwarders are "disintermediated". At the same time, access to capacity containerized, to the performance of the carriers' schedules and the reliability of the service has further decreased".

Illustrating the request for urgent intervention addressed to the European Commission, the Director General of CLECAT, Nicolette van der Jagt, highlighted some specific critical elements which, in the opinion of the association, distort the market for shipments starting from the vertical integration in place by of maritime carriers that - he explained - "is particularly unfair and discriminatory as the navigation, which enjoy an exemption from the normal rules on competition, use unexpected profits to compete with other sectors which do not have such immunity.' "Also consolidation - he added - is problematic, as fewer companies lead to fewer service options, limits the supply of cargo spaces and determines a position dominant on the market which, in turn, allow a few companies discriminate between Beneficial Cargo Owners, SMEs and freight forwarders, which therefore leads to higher rates for everyone. Over 90% of international trade - has remembered van der Jagt - are carried out by sea. Currently three alliances composed of eight shipping companies control 80% of these commercial exchanges. This - he underlined - is a oligopoly applying oligopolistic tariffs'.

The Director-General of CLECAT pointed out that the data shared by maritime carriers through agreements that interpose between them give these companies control even greater on the market, strengthening their power to limit competition and improving their ability to control of tariffs not only for maritime shipping services, but also of those of end-to-end services upstream and downstream of the supply Chain.