FORMER TAA CARRIERS HEAD BACK TO COURT LINES SEEK TO AVERT EU FINES

FORMER TAA CARRIERS HEAD BACK TO COURT LINES SEEK TO AVERT EU FINES

Ocean carriers that operate services between the United States and Northern Europe will be back in court again Wednesday in a bid to prevent the European

Commission from imposing hefty fines on the 15 members of the former Trans- Atlantic Agreement.

Lawyers representing the TAA will ask the Luxembourg-based Court of First Instance to issue an interim order protecting the lines from the risk of fines that the commission, the European Union's executive arm, is threatening to levy.The lines claim that the removal of their antitrust immunity before the completion of appeal proceedings is illegal, and also will destabilize the

trans-Atlantic liner shipping trades.

The TAA has secured the backing of the U.K. government, which has indicated that if the commission does try to fine the shipping lines for jointly setting inland freight rates, Britain may ask for the matter to be referred to an EU advisory committee. Britain's representative in Brussels already has written to the commission expressing concern about the threatened fines.

The court hearing, scheduled to begin Wednesday afternoon, is the latest legal twist in the long-running fight between shipowners on one side, and shippers and Brussels on the other, to determine whether multimodal freight rates are permitted under EU law.

Although the TAA, since replaced by the Trans-Atlantic Conference Agreement, was banned by the commission a year ago, the lines are appealing that decision through the courts and are unlikely to know the final verdict for a year or more. But earlier this year, the TAA obtained an interim injunction from the Court of First Instance that temporarily suspended the

commission's ban. The commission tried but failed to get that court decision overturned.

The commission can fine companies that break the EU's competition laws up to 10 percent of their annual revenue, and the carriers want to ensure that TACA members are not penalized for collectively quoting intermodal freight rates.

Defendants appealing a commission decision normally would be immune from any penalties until the legal processes have been completed.

But Karel van Miert, the EU's competition commissioner, is planning to remove this exemption within the next few weeks in what is thought to be an unparalleled move by Brussels.

Representatives from several of the TAA lines will attend the hearing, while the European Community Shipowners' Association and the Japanese Shipowners' Association are expected to intervene on behalf of the trans- Atlantic carriers. The commission will have the backing of Britain's Freight Transport Association, the European Council of Transport Users, and the Paris-based Association des Utilisateurs des Transports de Fret.

If Brussels removes shipping lines' immunity from fines, it could have the effect of ending multimodal rate-setting immediately, even though the legality or illegality of this practice has not been confirmed. The TAA lines felt compelled to seek court protection after failing to obtain written clarification from the commission about its intentions.

TAA lawyers hope the president of the Court of First Instance will issue a judgment within a couple of weeks.