News / Shipping clearly divided over EC decision to scrap CBER 

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The shipping industry is divided on yesterday’s announcement by the EC that it will not renew the Consortia Block Exemption Rule (CBER) for liners.

John Butler, president & CEO of liner lobby group the World Shipping Council, said: “We disagree with the logic behind the decision to discontinue the CBER. The shift to general EU antitrust rules will create a period of uncertainty as carriers adjust to the new legal structure.” 

The Federation of European Private Port Companies and Terminals (Feport) agreed. It said: “[Feport] was not in favour of a repeal as clear prohibitions of some behaviours in the framework … were better for us than a legal void and no monitoring from the EU commission of the behaviour of the alliances. 

“The bargaining power of the alliances towards customers and service providers has been tremendously also increased thanks to the benefits of the CBER.” 

And the International Chamber of Shipping added: “The decision … puts the EU out of step with other jurisdictions worldwide and will only add to current economic uncertainty for maritime carriers and their customers as they work to adjust to this new legal framework.

“But it is significant that DG COMP has said that it continues to recognise the benefits of liner shipping consortia and vessel-sharing agreements, which lead to economies of scale and better use of space on vessels with associated efficiency benefits passed on to the users of shipping services in terms of better coverage of ports and better services.

“As permitted by other competition authorities worldwide, it is right that vessel-sharing agreements will remain lawful in EU trades and an important and crucial method for container shipping lines to ensure efficient and sustainable maritime transport both for Europe and for the rest of the global economy.”

However, Nicolette van der Jagt, director general of forwarder association Clecat welcomed the decision, and said: “We are pleased that the commission has listened. Freight forwarders have long resisted the granting of these extraordinary exemptions to shipping lines and have opposed a renewal of the block exemption…at previous reviews. 

“The CBER no longer fulfils the criteria of effectiveness, efficiency and EU added-value…CBER in its present form provides excessive scope for unintended co-operations, far beyond those necessary for the operation of vessel-sharing agreements.” 

Clecat said: “Carriers operating to or from the EU will assess the compatibility of their co-operation agreements with general EU antitrust rules based on the extensive guidance provided in the Horizontal Block Exemption Regulation and Specialisation Block Exemption Regulation.” 

Feport concluded that the repeal “does not mean the end of the major alliances in container shipping”, and urged the EC to “set clear limits on the market behaviour of large alliances and rigorously enforce existing law”. 

WSC’s Mr Butler added: “Vessel-sharing agreements will remain a fully legal and supported way for carriers to ensure efficient and sustainable transport for Europe. WSC is carefully reviewing the basis for the commission’s position and looks forward to further dialogue to ensure regulatory clarity.”