Cargo Shippers Pressure EU for Review of Container Shipping Regulation
Ten trade organizations representing the owners and forwarders of cargo, port terminal operators and other parts of the supply chain dependent on container shipping are demanding an immediate review of European Union’s Consortia Block Exemption Regulation for the container shipping industry.
The Regulation exempts container shipping lines from many of the checks and balances of EU competition law and permits them to exchange commercially-sensitive information to manage the number and size of ships deployed and the frequency and timing of sailings on trade routes around the world.
According to a joint press notice issued by the organizations, European businesses and other parties in the supply chain have suffered huge disruption to the movement of goods by container shipping since the Regulation was last renewed in April 2020, with many sailings being cancelled or diverted to other ports, and ports being bypassed at short notice. At the same time shipping rates have more than quadrupled on many routes and continue to remain 3 to 4 times higher than in 2019 before the pandemic.
While the groups recognize the impact of COVID on the supply chain disruptions and shipping woes, they collectively contend that something is amiss when the shipping companies continue to pull in record revenues and profits.
"The benefits of the exemptions from general competition law enjoyed by the shipping lines are not being shared fairly between the lines and the rest of the economy, and this in itself constitutes a compelling reason why the Block Exemption should be reviewed urgently," the press statement read.
In their letter to the Commission the signatories point to the revelations and recommendations of investigations conducted in the United States by the Federal Maritime Commission, resulting in May in the passing of a new Ocean Shipping Reform Act, addressing many of the grievances of users and services suppliers to the container shipping lines.