Shippers laud Oberstar carrier bill

Shippers laud Oberstar carrier bill    Shippers’ organizations on three continents said they welcomed Rep. Jim Oberstar's proposed legislation that would eliminate antitrust immunity for ocean carrier agreements in the United States.
   The proposed legislation would prevent carriers from discussing, fixing or regulating freight rates and surcharges through conferences or discussion groups.

Oberstar

   Oberstar first announced he would introduce the legislation during a June forum sponsored by the National Industrial Transportation League, and Executive Vice President Peter Gatti said “principal components of the bill are good ones.”

Gatti

   The NIT League intends to “highlight elements of the bill that enjoy our support, and we intend to communicate to Oberstar and Cummings as we take some time to look at it and comment in detail,” Gatti said.
   Oberstar said other parts of the bill would give the Federal Maritime Commission a bigger role in mediation and arbitration, require surcharges to 'accurately reflect increases in the carrier's cost,' and address the practice of bumping or rolling containers.
   Gatti expressed skepticism of World Shipping Council comments that the bill, would increase price volatility, noting the extreme gyrations in pricing that have occurred over the past two years.
   NIT League has scheduled a webinar for Wednesday afternoon among its members to discuss the legislation.

van der Jagt

   The European Shippers' Council called the bill 'a very positive step forward,' said Nicolette van der Jagt, secretary general, in a statement. 'If enacted, it would end limited antitrust immunity that has been in place in the U.S. for nearly 100 years. We are confident that the bill will receive a lot of support in the U.S, but also from shippers' groups, in Europe and in particular in Asia, the latter being the last bastion of liner cartel activity. More and more people see that anticompetitive collaboration is not the way to address industry's problems. Competitive collaboration is required: working closer with customers is the way to tackle the pressures of rising costs and to protect one's investment.'
   The bill would bring the United States largely in line with regulation in Europe, where there has been a prohibition to discuss and agree rates since October 2008. Carriers in the United States would be allowed to continue to operate vessel sharing agreements, although such authority has limitations to ensure adequate competition in particular trades.
   'Interestingly, Oberstar referred to the EU's consortia block exemption threshold of 30 percent market share as 'a good place to start' in his proposed bill,' the ESC said.
   'It was also refreshing to see that Mr. Oberstar specifically referred to the repeal in Europe and remarked that since the elimination of the antitrust immunity here, he was not aware of any ocean carriers being put out of business because of the loss of that exemption,' van der Jagt added.

Lu

   Meanwhile, Asian Shippers' Council Chairman John Lu said the proposed bill was 'music to his ears.' The ASC has been fighting to end liner antitrust immunity in Asia.
   'For years we have asked our governments to put the necessary mechanism in place to rein the cartels in but our pleas have fallen on deaf ears,' Lu said in a statement.
   He specifically referred to the Singapore's government's proposal earlier this month to extend antitrust immunity for five years, one in which the government said that liner antitrust immunity was the norm through most of the world.
   'When the European Union outlawed shipping conferences and rate agreements in 2008, Singapore took the position that conferences were still permitted in large swathes of the world, hence its decision not to review the exemption accorded to liner shipping agreements in the Singapore Competition Act,' said Lu, who is also chairman of the Singapore National Shippers' Council. 'But the Competition Commission of Singapore cannot so easily dismiss the issue if the U.S. were to join the EU in banning the cartels.'