Associations plead case for EU Consortia Block Exemption Regulation

The joint submission from the World Shipping Council (WSC), the International Chamber of Shipping (ICS), and the Asian Shipowners’ Association (ASA) pleads the case for renewal of the Consortia Block Exemption Regulation (CBER) which allows container lines to share certain information which would otherwise be against antitrust rules.

The regulation is set to expire in April 2024 unless renewed. The European Commission invited feedback on the regulation as the business practices of container lines come under increased scrutiny after a period of higher freight rates, lower service levels and widespread disruption. Container lines blame the disruption on elements beyond their control, while shippers say container lines' ability to co-operate is partly to blame.

WSC, ICS and ASA said their submission calls for renewal, “demonstrating how vessel sharing contributes to the EU policy goals of reducing transport emissions, increasing competitiveness and improving efficiency to reduce costs.”

“From an operational and environmental perspective, vessel sharing is like public transport and car-pooling schemes: seeking to maximise efficiency and reduce emissions through the shared use of transport assets and infrastructure, significantly reducing emissions per unit of cargo transported,” says Yuichi Sonoda, Secretary General of Asian Shipowners Association.

Related:European Commission grants container block exemption review wish

A series of companies and associations in the ports, shipping and logistics sectors signed a letter to European European Commissioner for Competition, Margrethe Vestager in July, calling for an immediate review of CBER.

“The effects of lockdowns on the production of goods and the shifts in demand due to the effects of the Covid pandemic were certainly significant. But the ability of the shipping industry to collectively manage these impacts, and at the same generate profits totalling over $186 billion in 2021, at the expense of the rest of the supply chain, and ultimately Europe’s consumers, demonstrate that something is wrong,” said signatories of the letter to the commissioner.

Defending the shipping lines’ response to Covid, John Butler, President & CEO of World Shipping Council, said: “The frustration that shippers have understandably experienced from service delays and increased cost has been channelled towards carriers, their vessel sharing arrangements, and the regulatory tools which facilitate such arrangements, including the CBER. But data shows and regulators concur that the problems were caused by factors outside carriers’ control and not by vessel sharing,” says

Related:Calls for EU container line block exemption review grow louder

The associations claim that the CBER is essential, brings benefit to the EU and has no downside from a competition or consumer welfare perspective.