EC TO REVIEW NEED FOR CONFERENCE ANTITRUST IMMUNITY
Officials of the European Commission told a meeting of international governments, regulators and industry representatives at the headquarters of the Organization for Economic Cooperation and Development on Thursday that they will review the EC regulation that permits joint pricing by conference carriers in Europe.
“The European Union said that they will review the antitrust immunity,” said Wolfgang Huebner, head of the transport division of the OECD, based in Paris.
The European Commission was represented at the OECD meeting, an international workshop on competition policy in liner shipping, by officials of both the EC transport directorate and the competition directorate.
J. Straggler, head of the transport unit of the competition directorate, told the meeting that the EC will undertake an investigation of its own into how the liner shipping industry works, according to industry representatives who attended the meeting.
The EC competition directorate confirmed that it will study the general question of the conference immunity and use a draft OECD report as a starting point. The report recommends the ending of the conference immunity, but the EC would not specify the expected outcome of its review and whether it would eventually withdraw this immunity.
In recent years, the EC said that it had no intention to end the antitrust immunity under EC Regulation 4056/86, but interpreted the immunity narrowly to stop what it regarded as anticompetitive agreements. The EC competition directorate already prohibits discussion agreements, stabilization agreements, structural capacity management agreements and conference inland tariffs in the European trades, while allowing only joint port-to-port price-making by conferences under regulation 4056.
About 130 industry, government and regulatory delegates discussed on Thursday a draft report produced by the OECD recommending that governments remove the antitrust immunity of conferences, discussion agreements and stabilization agreements.
“Contrary to last year, the EC said that the report was a good starting point for a review of the 4056 regulation,” said Jerome Orsel, director of transport at the Paris-based Association of Users of Freight Transport.
A reform of regulation 4056/86, adopted by European governments 15 years ago, would require the approval of the EC and of EU governments. Most EU governments have until recently been hostile to a reform.
“There’s a lot of interest from governments,” said Neil Johnson, global logistics manager of the Freight Transport Association, which represents British shippers.
“The U.K. government is warm to the idea (of a reform),” he added.
The European Shippers’ Council launched a campaign to kill the antitrust immunity of liner conferences in late 1995 and has repeatedly called for a reform.
Alfons Guinier, secretary general of the European Community Shipowners’ Association, said that the EC only said that it would “consider whether relevant legislation had to be changed, adapted or improved,” but did not mention explicitly the removal of the immunity of conferences.
“That’s not very clear,” he commented.
European shipping lines would oppose the removal of the immunity of conferences, but “that’s not on the agenda,” he added.
Representatives of the U.S. administration did not support a repeal of the immunity of conferences during the OECD meeting, although Department of Justice officials are critical of the continued immunity under the U.S. Ocean Shipping Reform Act, sources said. Influential Republican congressmen, led by Rep. Henry J. Hyde, R-Ill., chairman of the House International Relations Committee and Rep. F. James Sensenbrenner Jr., R-Wis., also have diametrically opposed views on the need for ocean carriers’ antitrust immunity from Democrat senators such as Senator John Breaux, D-La., chairman of the Senate Subcommittee on Surface Transportation and Merchant Marine, and Senator Ernest Hollings, D-S.C., chairman of the Senate Committee on Commerce, Science and Transportation.
The U.S. National Industrial Transportation League, which called for the repeal of the immunity of conferences in the mid-1990s, reportedly told the OECD meeting on Thursday that it was satisfied with the Ocean Shipping Reform Act of 1998.