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The EC’s competition commission has cleared the proposed merger of container shipping lines Hapag-Lloyd and CSAV, on condition that the Chilean line withdraws from two services it runs jointly with Mediterranean Shipping Co.
The EC said it had investigated the effect of the merger on 12 routes connecting Europe with the Americas, Asia and the Middle East and, on the whole, had found that it wouldn’t restrict competition or affect prices.
However, its approval is conditional on CSAV withdrawing from the Euroandes and Ecuador Express services it operates with MSC, which it said would have created new links between previously unconnected consortia.
“The commission had concerns that these new links would have resulted in anti-competitive effects on two trade routes: the route between Northern Europe and the Caribbean, and the route between Northern Europe and South America’s west coast. On these routes, the merged entity, through the consortia that the two companies belong to, may have influenced capacity and therefore prices to the detriment of shippers and consumers,” it said.
CSAV and Hapag-Lloyd have committed to terminating the former’s participation in the services.
EC vice-president Joaquín Almunia said: “Liner shipping plays a central role in global trade, so competition in this sector is essential for businesses and consumers in the EU. Through the commitments, our decision averts the risk that the merger between Hapag Lloyd and CSAV could lead to any price increase.”
The EC found that there would be no threat to competition freight forwarding or terminal operations segments – CSAV has a small freight forwarding division and Hapag-Lloyd has a stake in Hamburg’s automated Altenwerder container terminal.
EC competition commissioner Joaquin Almunia
Hapag-Lloyd welcomed the decision, although added that it was still awaiting clearance from other jurisdictions. The US Department of Justice cleared the merger in August.
The merger – which many in the liner industry see as a takeover of CSAV by its German counterpart – will create the world’s fourth-largest container shipping line, with 200 vessels, annual revenues of €9bn and transport volumes of 7.5m teu.
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