The European Commission has taken the decision, which is expected by shippers and shipping agents and deemed harmful by global containerized shipping companies, not to renew the European Exemption Regulation Regulation that exempts consortia between maritime carriers in line with EU antitrust rules and allowing them to enter into Vessel Sharing Agreement agreements for the sharing of cargo spaces on ships. The regulation will therefore expire on April 15.

In announcing the decision today, Brussels said it had concluded that the Consortia Block Exemption Regulation (CBER) no longer promotes competition in the maritime transport sector, the conclusion to which the Commission has come as a result of the procedure for review of the legislation and consultation with the stakeholders that was initiated in August 2022 ( of the August 9 2022).

"The maritime transport services are essential for European and global trade," EU Justice Commissioner Didier Reynders said in a statement. This key sector has undergone significant structural changes, such as the consolidation of carriers, global alliances and vertical integration, resulting in new market conditions. Our examination has shown that a specific category exemption for shipping companies is no longer suitable for these new market conditions. This is why we have decided not to extend the current legal framework and let it expire on April 25, 2024. " A legal framework that had been adopted in 2009 by the European Commission, which had extended its validity in 2014 and 2020.

The Commission found that the information collected as part of the investigation launched in August 2022 showed that the effectiveness and efficiency of liner shipping services had been shown to be low in 2020-2023. regulated by the CBER. In particular, it has been found that, given the limited number of consortia falling within the scope of the Regulation, CBER makes limited savings on compliance costs for carriers and plays a secondary role in the decision of the shipping companies to cooperate. The EU Commission said that, in addition, in the period considered the regulation no longer allowed smaller maritime carriers to cooperate with each other and to offer services in competition with those of the largest carriers.

In particular, in the concluding report on the assessment of the regulation it is noted that " the competitive structure of the liner shipping sector has changed significantly since the CBER was adopted for the first time in the 2009. It has been a fragmented sector, with numerous regional carriers and players along the supply chain, to a more consolidated sector modelled by a few global and integrated players that during the evaluation period have cooperated in the scope of alliances. These structural changes-highlight the document-have not only reduced the number of small and medium-sized carriers that could benefit from the CBER, but also questioned the appropriation of an exemption per specific category for the sector. While such changes are certainly antecedents to the assessment period, their full impact on the functioning of the global supply chain could only be measured in the last three years, when critical market conditions have sparked chain reactions and highlighted the weaknesses of the EU trading system. Such weaknesses-the report states-cannot and should not be attributed to consortia benefiting from exemption by category. This, nevertheless, should neither diminish the opposition to the CBER express by the transport users and port operators, nor hinder an objective, comprehensive and evidence-based assessment of the CBER. "

" The evidence gathered by the carriers highlights the effectiveness and efficiency, in the best of limited assumptions, of the CBER during the evaluation period. In fact, both the small number of individual consortiums within the scope of the CBER in 2020 (13 out of 43) and the profile of such consortia (which always involved one of the first five global carriers, which was also a member of a consortium not exempt operating in the same traffic) tend to show that the CBER has made to the carriers limited savings on compliance costs and has no longer achieved its goal. The aim was to facilitate the creation and operation of pro-competition consortia, in particular between small and medium-sized carriers, " the document said.

"In addition, the carriers argue that the key terms of the CBER are clear, unequivocal and accessible to all carriers, particularly those of small size," it said. However, their feedback tends to show divergent interpretations of the CBER, including among large carriers with proven experience in enforcing antitrust rules and resources for compliance. Finally, the carriers confirm that the decision to enter a consortium is driven by commercial needs and that the antitrust rules, at the most, are of a secondary role. "

" With regard to the first part of the assessment, the evidence presented by the carriers in support of the efficiency gains stated is inconclusive, in particular due to the impossibility of overcoming some of the results. methodological limits. These limitations make it difficult to establish causal links between consortia and benefits for consumers. The limitations include the absence of counterfactual, the interdependence of possible causes of the benefits under consideration and the volatility of noli. Market developments in the sector during the evaluation period tend to confirm both the rigidity of the demand for liner shipping services and the limited supply elasticity. Asnsieme, these two factors reduce the likelihood that any efficiencies in terms of costs obtained by carriers will be transferred to transport users. Furthermore, it is difficult to believe that consortia are indispensable under Article 101 (3) TFEU to achieve environmental efficiencies, as the sector is subject to binding measures at international and EU level to reduce the greenhouse gas emissions and pollution. "

"With regard to the second part of the assessment, the interruptions experienced by different supply chain actors and by EU forwarders during the Covid-19 pandemic show the limits of an antitrust instrument," the document said. This is because the CBER has helped to commercialize liner shipping services, while the ability of shippers to exploit the advantages of the increasing scale and scope of carriers is limited by the capacity limits of the other actors in the supply chain (e.g., port operators and terrestrial operators). More concretely, if transport users acknowledge that consortiums have supported the investments needed to run intercontinental services at a lower unit cost and with faster transit time, they now complain that consortia appear to be contribute to a market in which the cost of entry has become prohibitive and where the differentiation of the service has disappeared to the detriment of the shippers. In addition, the decrease in direct connectivity (i.e. the number of pairs of countries that can be reached without transshipment), which began before the Covid-19 crisis, has continued in the evaluation period, while it has been empirically demonstrated that direct regular maritime links contribute to lower trade costs and increase trade volumes. "

"Overall, the CBER does not appear to be adequate for its purpose, as it does not meet the criteria of effectiveness, efficiency and added value of the EU," the report said. This conclusion is based on both the information submitted by the parties concerned with respect to the period 2020-2023 and other evidence collected during the assessment in relation to the functioning of the container shipping sector and to the contribution of consortia to the competitiveness of this sector. "

The European Commission has recalled that failure to renew the validity of the regulation does not mean that after the expiry of the standard, cooperation between maritime carriers becomes illegal under EU antitrust rules, equipping carriers operating from and for the EU, after April 25, to assess the compatibility of their cooperation agreements with European antitrust rules on the basis of the guidelines provided in the new block exemption regulation on horizontal agreements and in the new regulation on agreements of specialization adopted by the Commission last June.