News / Asian carriers will be hit harder by CBER demise than European peers

Photo: VesselFinder

Asian box lines possess far fewer large containerships than their European peers and may be more adversely affected by the EC decision last week not to renew consortia block exemption regulation (CBER) when the immunity expires on 25 April 2024.

Former Yang Ming chairman Bronson Hsieh told Taiwanese newspaper ETToday that 20% to 50% of European carriers’ slots were placed in alliances, while for the Asian carriers, the percentage was 70% to 80%.

He explained: “If alliances adjust their operating conditions, it could affect Asian operators more, especially as the European players own more mega-containerships.

“In future, shipping lines’ collaborative structure may be reorganised. How the EC manages the situation is a challenge that liner operators need to overcome,” he said.

The Asian Shipowners’ Association (ASA) said today it disagreed with the EC decision and claimed liner operators should be immune from antitrust prosecution in order to provide efficient services and frequent port calls.

Secretary general Yuichi Sonoda did express relief that cooperation between liner operators could continue in the form of consortia and vessel-sharing agreements under horizontal and specialised block exemption regulations.

He said: “The European Commission recognises the value of liner shipping consortia and vessel-sharing agreements and has now chosen to ensure the legal certainty of those carrier agreements under the general EU antitrust rules.”

A Linerlytica report today suggests that reaction to the removal of the antitrust exemption has been exaggerated, as the move would “strengthen and not undermine” the alliances.

The exemption applies to operators with a combined market share of less than 30% on the services they operate, a threshold exceeded in many of the alliances’ routes.

Indeed, 30 of the 43 consortia operating in the EU exceed the 30% market share ceiling, including the 2M, Ocean and THE alliances.

“The removal of the CBER won’t impact existing alliance agreements, and carriers that operate in consortia agreements outside the CBER will still be required to self-assess for compatibility of their agreements with EU antitrust rules,” Linerlytica said.