ASC asks China to clear up confusion over liner antitrust issues

ASC asks China to clear up confusion over liner antitrust issues Asian shippers met this week in Macau to discuss how a post-conference world might look, as well how new Chinese antitrust regulations might affect liner rate setting in Asia.
   At the beginning of August, China enacted a new antitrust law that the Asian Shippers’ Council believes trumps existing maritime regulations that allow lines to collectively set rates and surcharges.
   “We believe that what has begun in Europe will have ripple effects around the world,” ASC said in a statement from the meeting. “And in the U.S. there is a call for review of the Ocean Shipping Reform Act. In Asia, China's antitrust law has been put into full implementation from Aug. 1, which is going to bring about a more market-based system in shipping. Unlike Singapore and Australia, China has made no block exemption for shipping conferences. With its sizeable volume of imports and exports, China is in a strong position to bring about changes in the obsolete conference system, an anachronism in this modern age of free market principles.”
   ASC Chairman John Lu told Lloyd’s List at the meeting that the shippers group will take lines who violate China’s new antitrust law to court, even though questions remain about whether the antitrust law or existing maritime regulations would take precedence in court.
   “We take this opportunity to call on the Chinese government to revise the present maritime regulations which allow collective rate setting activities,” ASC said. “Failure to do so will result in unnecessary confusion, which will invariably be exploited by shipping lines to advance their interests. The meeting expressed its concern on the aftermath of the reform to make sure that it will not lead to any unhealthy business environment.”
   ASC also said shippers should not be continually subjected to new and increased surcharges.
   “The list of charges and surcharges that shippers are asked to pay on top of freight rates for sea transport has continued to lengthen,” ASC said. “There is an extra charge for just about everything — terminal handling charge, origin receiving charge, bill of lading fee, documentation fee, equipment management fee, container seal charge, port security fee, currency adjustment factor, etc. There should only be all-in freight rates.”
   ASC said surcharges should only be temporary in nature.
   “We accept that surcharges are sometimes necessary — in times of war, when port congestion is severe or when bunker prices hit the roof,” ASC said. “As these are exceptional circumstances, the surcharges needed to defray the increased cost therefore should be temporary in nature, introduced after consultation with shippers. What is most unacceptable is the emergency bunker surcharge imposed by shipping lines in the Taiwan to Hong Kong-South China trade. The EBS, which is being forced on consignees in Hong Kong and South China, goes against the norm of international shipping practices. Traditionally charges and surcharges are collected from the party that pays the freight, but in this instance, consignees have had to stump up HK$440/RMB 400 per TEU, regardless of whether freight has already been prepaid in Taiwan.”
   The shippers groups that comprise ASC said shippers must be continually wary of new charges.
   “The China Shippers' Association has raised this issue with China's Ministry of Transport and Communications, and the ministry has concurred with CSA's position that the EBS was unreasonable,” ASC said. “It had informed the lines concerned to observe the rules. The Hong Kong Shippers' Council, Macau Shippers' Association and Shenzhen Shippers' Association have taken joint actions to oppose the charge. The organizations also called for government intervention. Asian shippers have to be most careful to check for shipping lines' further attempts to exploit the fluctuating fuel prices to impose hefty emergency surcharges.” ' Eric Johnson