EC to enforce EU competition rules for tramp sector

The European Union (EU) Member States’ ministers responsible for competition unanimously agreed to follow the European Commission’s (EC) advice and repeal Regulation 4056/86. This Regulation, which has been in force since the late 1980s, has effectively not only exempted liner conferences from the general provisions of EU competition rules, but also deprived the European Commission of the implementation powers necessary to enforce these rules in the non-liner (“tramp”) shipping sectors.

Despite the fact that the tramp shipping sector has all the time been subject to the rules of the EC Treaty?s Article 81 (concerted practices) and Article 82 (abuse of dominant position), this week?s change is significant because it will bring the tramp shipping sector much more to the forefront as far as EU enforcement of the competition rules is concerned.

The Council decision, which in legal terms lifts the exclusion of tramp shipping services from the scope of the general Commission implementation rules for competition laid down in Regulation 1/2003, has already been published in the Official Journal of the EU and will become effective on 18 October 2006.

Publication in the Official Journal only three days after the decision is extremely fast by normal standards ? it can often take up to three months ? and this emphasises the importance being attached to this regulation. The tanker shipping industry, as well as other maritime transport operators, would accordingly be well advised always to take the provisions of the EU competition rules into account when planning and providing its services.

Significantly for the maritime transport sector, this process does not entirely end with this week?s repeal of the current rules. There will be a two-year transitional period ending in October 2008 for liner conferences. However, since the material rules (as opposed to the implementation rules) are being left unchanged as far as the non-liner (tramp) shipping sectors are concerned, a similar transitional period has not been granted to maritime transport as a whole.

However, one might hope that during this two-year period, the Commission will be cautious in its application of the rules also for the tramp sector, particularly as far as fines are concerned. One reason for this is that in the absence of relevant jurisprudence in the field of EU competition rules and tramp shipping, the Commission will meet the industry?s request for legal guidance on how the provisions of Articles 81 and 82 are to be understood in the non-liner sector. Such legal guidelines will now be developed in close consultation with Member States and industry stakeholders during the forthcoming two years.