ESC: OECD REPORT JUSTIFIES CALL FOR END OF CARRIERS’ IMMUNITY
The European Shippers Council has reiterated its call for an end of the antitrust immunity of carrier conferences, following the publication of the Organization for Economic Cooperation and Development’s recent report on liner shipping competition policy.
“The report delivers yet another blow to the increasingly discredited and unacceptable practices of liner shipping conferences,” said the ESC, an organization that has been a firm critic of the carriers’ immunity for years.
The OECD report, published last week, urged OECD governments to reform competition rules in liner shipping, and remove the antitrust immunity for carrier conferences and discussion agreements.
The ESC said that the critical OECD report follows the recent dismissal by European courts of appeals by carriers against European Commission rulings concerning conferences in Europe. The rulings, upheld in court, “condemned the legality of practices by the former Trans-Atlantic Agreement and the Far Eastern Freight Conference during the 1990s,” the ESC said.
“ESC supports the OECD report’s call for an end to antitrust exemptions covering price-fixing, freight rate negotiations and trade wide discussion agreements, despite the avalanche of predictable protests from shipowner representatives,” the Brussels-based shipper representative body said.
Dick van den Broek Humpreij, chairman of the ESC, said that the shipper group welcomes the fact that the European Commission is taking the OECD recommendations seriously.
“The Commission has effectively recognised that following a fifteen-year period since implementation of the liner conference block exemption (in Europe) it is now appropriate to review the regulation in light of current regulatory and trading conditions,” he said.
The ESC hopes that the report will form the basis of discussions with the liner shipping industry about the future commercial and regulatory structure of the industry. The OECD report recognizes that close cooperation and partnership between customer and supplier “is the way to do business in the future,” Humpreij said.
The European antitrust regulation granting formal immunity to carrier conferences was introduced in 1986. In December last year, the European Commission said that it would review the general question of the conference immunity, and use the draft OECD report on competition as a starting point.