Separately, the three Japanese ocean carriers – NYK, “K” Line and MOL – on Friday filed an agreement with the Federal Maritime Commission to merge container operations.
The Competition Commission of Singapore (CCS), a statuary board that protects and enforces the Competition Act under Singapore’s Ministry of Trade and Industry, on Friday approved the proposed joint container shipping venture between Japanese ocean carriers NYK, “K” Line and MOL.
The approval is available for public viewing on the CCS Public Register.
The CCS had to determine whether the merger would infringe upon the Competition Act, which prohibits anti-competitive mergers.
The CCS has defined the joint venture as one that is merging the container liner shipping businesses of the three carriers, both inside and outside Japan, but all other services – such as logistics services, bulk shipping, car transport and liquid transport – will be conducted separately and independently.
In determining the effect of such a merger, the CCS conducted public consultations and sought feedback from vessel-operating common carriers, non-vessel-operating common carriers and cargo owners. The submissions and feedback received indicated that such a merger would still be competitive.
Separately the three carriers on Friday filed what they call the “Tripartite Agreement (FMC Agreement 012475)”
with the U.S. Federal Maritime Commission to jointly operate container operations. Unless the FMC asks for additional information or objects, the
agreement would become effective May 8.
When NYK, “K” Line and MOL announced last fall they would spin off their container divisions, they said they would establish the joint venture this July and commence business in April 2018.
All three Japanese carriers are members of THE Alliance, which will officially launch April 1. The other members of THE Alliance are Hapag-Lloyd, which is in the process of acquiring United Arab Shipping Company; and Yang Ming.
The Tripartite Agreement filed with the FMC will allow the three Japanese carriers to “establish, operate, and maintain a joint liner shipping service operating as an ocean common carrier under such trade name or names as they may determine” on a worldwide basis, the FMC explained. It appears the three carriers will use their own brand names this year and perhaps switch to a single brand next year.
The three carriers said in the FMC filing the joint service “shall operate as a single carrier, which shall incorporate the prior separate vessel operating common carrier containerized liner services in the trade that were operated separately by each of the parties.”
When the deal was announced last fall, the carriers had estimated they would have a collective 1.4 million TEUs of capacity, making them the sixth largest container carrier in the world. The announcement came after a tumultuous year for shippers, with many merging or acquiring other shipping companies, such as COSCO and China Shipping merging and CMA CGM acquiring APL.
Singapore grants Japan’s ‘Big 3’ approval to merge container operations
