Press release

The European Shippers’ Council (ESC) remains deeply worried about proposals put forward by the liner shipping industry for a replacement to the out-going liner conference system.

ESC was this week given advance sight of the much anticipated proposals from the European Liner Affairs Association (ELAA) launched today. Containing some 200 pages, the ESC has not had the opportunity to fully assess the proposals that carriers have put to the European Commission (EC) as a replacement for the collective decision-making system allowed within liner conferences.

In its initial analysis ESC, already critical of the outline proposals that had been made known to it by ELAA and the EC, has become even more concerned.

‘I fear that this is something akin to a wolf in sheep’s clothing’ said Nicolette van der Jagt, Secretary General of the ESC. ‘There is a lot of detail in these proposals; they recommend the EC to allow carriers on all trades to and from the EU to discuss and interpret data and market analyses, and then later discuss with shippers the same data and information. The lines will have formed an opinion on what the data means for them and how they are likely to respond. What is to stop a general unwritten acceptance of such conclusions among all the carriers, so that consultation with shippers becomes little more than the lines telling shippers what they can expect? How can any shipper then individually negotiate different service levels, terms and conditions and prices if confronted by such a united front from the carriers?’

‘I am afraid that many of our members, shippers, would sit in horror as they participate in such a so-called consultation forum, powerless to influence the carriers, and unable to discuss many of the real issues that affect their businesses, such as congestion, security or service performance.

‘We have repeatedly questioned why a price index is required by the lines; why do they need to discuss and interpret together market information, forecast capacity availability and deployment, traffic volume data, and surcharges. They have dropped the call to establish between them common formulae for determining surcharges, but my members are suspicious about the intentions behind their revised plans to publish movements in those costs that are currently separated out into surcharges, such as currency, fuel and port surcharges. Again, however, it is the notion that all carriers could be involved at arriving at a common interpretation of the data and what it will mean in terms of carrier strategy, that fills us with most trepidation.’

‘This could be a liner conference or Discussion Agreement via the back-door. We argue that co-operation technically and commercially between competitors or with customers and other service providers are well catered for under existing competition rules, within defined market share boundaries in order to prevent market dominance and collusion. The ESC sees no reason why the information exchange concept could not considered in a similar way, shared among groups of companies, groups restricted in size by competition rules based on market share thresholds.’

‘We have no problem with the notion of making better information more publicly available in order to facilitate better business decisions, but not at the expense or risk of anti-competitive practice or collusion in the market. The European Commission and Member States should reject the ELAA proposals and insist on the liner shipping industry operating under normal rules of competition that apply to the rest of us.’

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