News / EC launches Consortia Block Exemption review and calls for feedback

Margrethe Vestager, EC competition commissioner

The European Commission has called for feedback on its Consortia Block Exemption Regulation (CBER) for liner shipping, as unhappy shippers and forwarders claim there are no benefits and many disadvantages to the rule.

The commission has sent targeted questionnaires to relevant parties in the liner shipping supply chain, inviting feedback on the functioning of the CBER, which is due to expire in April 2024.

The review will assess the impact of the CBER since its renewal in 2020 and consider whether the exemption should be extended, either in current or amended form.

Interested parties will have eight weeks, until 3 October, to provide comments.

Last month, ten trade organisations wrote to the EC urging the competition commissioner to launch an immediate review of the CBER. James Hookham, director of the Global Shippers Forum, a signatory to the letter, told The Loadstar: “Since April 2020 we haven’t seen many benefits [of the CBER] so therefore, we are making the case that it needs reform.”

The disruption to the movement of container shipping caused by the Covid pandemic has put strain on the working of the CBER. Mr Hookham suggests there are other ways vessel-sharing agreements can be authorised without using an immunity.

“An exemption is a very blunt instrument for a very fine problem,” he added.

Both Mr Hookham and Clecat director general Nicolette van der Jagt, another signatory to the letter, are critical of the exemption being “unbounded”.

“We believe this is an exemption that is far too generous,” said Mr Hookham, while Ms Van der Jagt said the exemption “needs clearer wording and clearer permissions about what can be done and what can’t be done”.

She said freight forwarders wanted a level playing field between forwarders and carriers and the exemption in its current form gives a competitive advantage to carriers. Ms Van der Jagt hopes the review will help.

There is further concern over the problems CBER can cause for the sharing of commercially sensitive information. The increasing digitalisation of the industry gives carriers the ability to collude over commercially sensitive information.

Critics say the CBER does not give sufficient controls over knowledge sharing, and the commission does not have adequate enforcement powers over preventing this. Mr Hookham also expressed concern over leakage of this information into wider supply chain activities.