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China sinks P3 Alliance

China sinks P3 Alliance
Plans for the P3 alliance of MSC, CMA CGM and Maersk have been abandoned after the Chinese Ministry of Commerce (MOFCOM) blocked the deal under China's company merger rules.

Preparatory work for the alliance began after it was announced in June last year and operations were scheduled to begin towards the end of the year.

After the European Commission and US Federal Maritime Commission approved the deal, it was expected that the Chinese would endorse the proposed network, more-so once the Wall Street Journal spoke to two insiders who suggested the deal would go through.

"In Maersk Line we have worked hard to address the Chinese questions and concerns. So of course it is a disappointment. P3 would have provided Maersk Line with a more efficient network and our customers with a better product." commented Vincent Clerc, cto and cmo at Maersk Line.

Delays in gaining approval from US and EU competition authorities pushed back the alliance's start date to the end of 2014, at which point P3 would have accounted for 255 vessels on 29 loops across the the Asia-Europe, transpacific and transatlantic trades.

Chinese shippers called on authorities to block the deal in December, as they believed the alliance would have too much power to dictate market terms.