EU Clears Ocean Carrier Cooperatives

Oct. 5, 2009
The European Commission extended to April 2015 the exemption allowing ocean carries to participate in cooperatives

Ocean shipping lines may enter into cooperation for the purpose of providing a joint service to transport cargo, says the European Commission. That block exemption has been extended to April 2015.

The new regulation has been extended to all liner shipping services, it is not limited to containerized cargo services. The exemption does not cover price fixing.

The Commission reduced the market share threshold that limits companies from the automatic exemption. The threshold has been reset to 30% vs. the 35% level previously established.

The European Shippers Council (ESC) supported the decision saying it has “particularly welcomed a reduction in the market share thresholds to 30% above which companies do not qualify for automatic exemption. ESC also welcomes the extension of the scope of the exemption to all cargo liner shipping services.”

he ESC explained, “The Commission has outlined that users can benefit effectively from consortia only if there is sufficient competition in the relevant markets in which the consortia operate. Therefore, anti-competitive restraints relating to fixing of prices charged to third parties, the limitation of capacity or sales and the allocation of markets or customers are excluded from the benefit of the regulation.”

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