EU Extends Ocean Carrier Anti-Trust Exemption

Container shipping consortia will be exempt from European Union competition rules for five years past the current deadline, the European Commission said Sept. 28.

The EU's executive arm extended the so-called block exemption for consortia until April 2015.

"The decision offers legal certainty … and ensures the regularity of service between ports and ensures that more ports are served than would otherwise be the case," Commission spokesman Jonathan Todd said.

Consortia have enjoyed anti-trust immunity since 1995, allowing ocean carriers to offer joint services, effectively sharing out market share, something that is illegal under EU competition rules.

The Commission has, however, modified the current exemption, which expires in April 2010, to increase competition in liner shipping services to and from EU ports. Consortia with over 30 percent market share on any trade are no longer automatically exempt from the EU's competition rules compared with the current market share threshold of 35 percent.

"I am confident this regulation strikes the right balance between the interest of the liner carriers and those of transport users," said EU competition commissioner Neelie Kroes.

The Commission stressed that the new regulation allows it to withdraw block exemptions if there is a negative impact on competition.

The EU grants block exemption if it judges that consumers would benefit more from co-operation between companies than they would if collusion is outlawed.

The EU banned price fixing liner shipping conferences in October, 2008.

Contact Bruce Barnard at brucebarnard47@hotmail.com.