European Parliament Report: confusing and contradictory

11 October 2005

Today, the Committee for Transport and Tourism voted on a report expressing its opinion on the European Commission's review of liner shipping competition regulation. The European Shippers  Council was disappointed but not surprised that the much awaited report from the European Parliament was inconclusive in its opinion with only 20 MEPs supporting it.

The report presented a number of contradictory views giving the impression that Parliament does not really know whether they are in favour of liner shipping cartels or not. On the one hand, the ESC welcomes the reports acknowledgement (paragraph seven) that the current conference system at best only partially meets the four cumulative conditions of Article 81.3, and therefore, by definition, is not compliant with Community competition law.

On the other hand, the report seems to be advocating some half-way house where the conference system could still exist and in some way protect small and medium sized deep-sea liner shipping companies, without price fixing but with some form of transparent freight rate calculation. The report also suggests that there would be no advantage to changing the current conference system.

Nicolette van der Jagt, Secretary General of the ESC, said shortly after the vote,  I believe this report will simply further confuse Members of the European Parliament. Some of the confusion could be caused by virtue of the mixed objectives of the TRAN Committee: the report says the purpose of the regulatory review must be to preserve and promote the expansion of a viable and competitive European shipping sector ; however, the purpose of EU competition policy is to protect and benefit the consumer. The purpose of reviewing the liner shipping regulation is to help European industry as customers of the shipping lines remain competitive by keeping down the cost and improving the service levels of liner shipping, and thereby ensuring the consumer benefits through lower prices.

It would seem that many MEP's have either forgotten the Lisbon Strategy or else forgotten what it is essentially seeking to achieve. It is hardly surprising if we find many MEPs left scratching their heads over this report, and perhaps why it did not receive the ringing endorsement of the TRAN Committee members. 

MEPs have a futher opportunity to re-visit this report when it goes to the Plenary of the European Parliament next month for approval.

For further information contact: Nicolette van der Jagt, Secretary General of the ESC - Brussels 00 322 230 2113