On Tuesday 10th October 2023, the European Commission has published its decision not to renew the Consortia Block Exemption Regulation (CBER), the Regulation exempting container shipping lines from parts of general EU competition law so they can co-operate together in consortia to provide shared services for their customers. Freight forwarders have long resisted the granting of these extraordinary exemptions to shipping lines and have opposed a renewal of the Block Exemption, especially in its present form, at previous reviews.
Nicolette van der Jagt, Director General of CLECAT welcoming the decision noted: ‘we are pleased that the Commission has listened to the voice of the customers, freight forwarders and their shipper clients. For many years, we have told the European Commission that the Regulation is no longer fit for purpose. During the feedback period on the evaluation of the regulation, CLECAT provided evidence that the CBER no longer fulfils the criteria of effectiveness, efficiency and EU added value. We also found that the CBER in its present form provides excessive scope for unintended co-operations, far beyond those necessary for the operation of vessel sharing agreements. CLECAT expressed in particular concern on the continued availability of the Block Exemption to parts of the liner shipping industry that is rapidly diversifying into other modes and supply chain functions creating market distortions in the overall logistics market, where container shipping lines are competing against other logistics service providers who are required to comply with general competition rules.'
She added: ‘our members have a significant interest in ensuring fair and equitable access to ocean transport. We have repeatedly informed the European Commission on the threats, in particular for SME forwarders and their clients, the shippers, posed by loss of competition. As noted by the European Commission, the expiry of the CBER does not mean that cooperation between shipping lines becomes unlawful under EU antitrust rules. Instead, 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.'
Ms van der Jagt concluded that the Commission’s decision is an important step towards the restoration of trust between the stakeholders necessary to build a resilient, integrated and efficient supply chain which requires ensuring that the liner shipping sector is not perceived as being subject to looser scrutiny from antitrust enforcers than other industries. The freight forwarding sector recognises the need for partnership and progress on crucial future issues such as decarbonisation, digitalisation, resilience building against future supply chain shocks.
A full press release from the European Commission on this development on the Consortia Block Exemption Regulation can be found via the below link:
https://ec.europa.eu/commission/presscorner/detail/en/IP_23_4742
Irish International Freight Association, Ireland’s National Association Member of CLECAT, congratulates Ms. Van der Gagt and her CLECAT Colleagues for their efforts in representing the interests of Freight Forwarders and Customs Brokers on this subject over recent years.
