It is reported that recently, the European Commission officially launched the review of the consortium block exemption regulation (CBER) and has sent targeted questionnaires to relevant parties in the liner transport supply chain to solicit feedback on the operation of CBER, which will expire in April 2024.
The review will assess the impact of the CBER since its update in 2020 and consider whether the exemption should be extended in current or revised form.
Exemption rules for container routes
EU cartelization rules generally prohibit companies from entering into agreements to restrict competition. However, the so-called collective exemption regulation (BER) allows container carriers with a total market share of less than 30% to sign joint liner transport cooperation agreements under certain conditions.
The BER will expire on 25 April 2024, which is why the European Commission is now assessing the performance of the programme since 2020.
Last month, ten trade organizations wrote to the European Commission urging the competition commissioner to review the CBER immediately.
James hookham, director of the global shippers forum, is the signatory of this letter. He told me: "since April 2020, we have not seen many benefits brought by CBER, so we think it needs reform."
The COVID-19 epidemic has interfered with the transportation of container transportation and brought pressure to the work of CBER. Mr. hookham suggested that there were other ways to authorize ship sharing agreements without using immunity.
"Immunity is a very blunt tool for a very delicate issue," he added.
Both Mr. hookham and Nicolette van der Jagt, director general of clecat (another signatory of this letter), criticized immunity as "unrestricted".
"We think this is an overly generous exemption," Mr. hookham said, while Ms. van der Jagt said that the exemption "needs clearer wording and clearer permission to explain what can be done and what can not be done".
She said that freight forwarders hope to have a fair competition environment between freight forwarders and carriers, and the current form of exemption provides carriers with a competitive advantage. Ms. van der Jagt hoped that the review would be helpful.
There is further concern that CBER may lead to the sharing of commercially sensitive information. The increasing digitization of the industry enables operators to collude with commercially sensitive information.
Critics say the CBER does not have enough control over knowledge sharing, and the commission does not have enough enforcement power to prevent this. Mr. hookham also expressed concern about the leakage of this information to broader supply chain activities.
Post time: Aug-15-2022