Transparency in shipping line prices welcomed by FTA

Tuesday, 23 February 2016 00:00 - - {{hitsCtrl.values.hits}}

The Freight Transport Association (FTA) says it looks forward to more transparency in shipping line prices following an investigation by the European Commission.

The 15 shipping lines involved in the three-year enquiry into price signalling have agreed to change future pricing regimes. The news is a major victory for FTA’s British Shippers’ Council, whose members first raised concerns about uncompetitive behaviour in 2010.

The European Commission has published a communication in the Official Journal confirming that the lines have offered commitments to the way prices are announced. The Commission’s commitments decision will introduce a degree of transparency into maritime transport pricing for the first time. In particular the lines have agreed that they will cease to announce general rate increases and publish the actual prices available to customers on an individual basis.

Under Article 9 of the main EU competition law procedural regulation (Regulation 1/2003), the Commission has now published a notice in the EU Official Journal giving interested parties, such as shippers, one month from 16 February 2016 to comment on its proposed commitments decision. This is called a ‘market test’.

Chris Welsh, FTA Director of Global and European Policy, said: “We welcome the Commission bringing this important case on liner shipping prices to a satisfactory close. As one of the original complainants FTA will respond to the market test now that the Commission has published its Notice.

“We look forward to a new clear and open approach by the shipping line operators which will remove the need for our members to resort to court proceedings for competition damages, an option which has been made easier by the 2014 EC Competition Damages Directive and the new Consumer Rights Act 2015 competition legislation in the UK.”

The notice details the content of the competition law infringements issued to the parties and confirms that the proposed changes to future pricing behaviour are acceptable to the Commission.

While the notice also acknowledges that the shipping lines deny any infringements that do not alter the Commission’s original assessment of the allegations. What it means is that the Commission has agreed not to continue its investigation in exchange for a commitment from the shipping lines to significantly change their pricing behaviour in the future.

While the lines involved will not be the subject of a decision finding infringements nor fined, they have agreed to stop the behaviour which the Commission considers unlawful and undertaken to improve the system of price announcements in future.