Lines ?disappointed? with regulation push

Lines ædisappointedÆ with regulation push    The World Shipping Council on Wednesday expressed “disappointment” over an industry push to end the shipping industry's antitrust protection.
   On Tuesday a coalition of 32 groups representing importers, exporters and third-party logistics companies sent a letter to Rep. James L. Oberstar, D-Minn., calling for an end to what they said was the “antiquated and inappropriate exemption” from antitrust laws that the liner shipping industry enjoys.
   The WSC, which represents the liner industry, said, “Carriers have been working cooperatively with the Federal Maritime Commission and with shipper representatives in efforts to discuss how current contracting processes can be improved for all parties.”
   The council pointed out that two of the principal liner discussion agreements have reached out to shippers. The Westbound Transpacific Stabilization Agreement has established an Export Shippers Advisory Panel, and the Transpacific Import Advisory Council began discussion last week with shippers.
   Oberstar first announced plans to seek a repeal of antitrust immunity in June at a Freight Transportation Policy Forum organized by the National Industrial Transportation League.

Gatti

   “We wanted to let him know we were very encouraged by those remarks and supportive of what he outlined,” said Peter Gatti, executive vice president of the NIT League, the country’s largest shipper organization and one of the signatories of the letter.
   Liner shipping companies “enjoy an extraordinary measure of protection from competition, but their customers have to live or die by the sword of market competition,” he said. The liner industry’s ability to benchmark rates, discuss conditions and supply does not happen in any other industry, he added.
   “All sectors of the liner shipping industry had difficulties adjusting to the rapid and unexpected growth in trade volumes following the unprecedented and financially disastrous year of 2009,” the WSC said.
   “Ocean carriers have added sufficient capacity to handle all U.S. imports. Capacity presently deployed to carry U.S. exports far exceeds shipper demand,” it said. “Carriers have also made substantial capital commitments in ordering additional container equipment to meet customers’ needs.
   “Lines have returned to profitability from the brink of financial disaster although rates in the transpacific are still not at 2008 levels.”
   WSC said it was “disappointed with the letter and its lack of recognition of these facts. However, the liner shipping industry is willing to discuss the Shipping Act and the current regulatory system with the House Transportation and Infrastructure Committee, with shippers, with labor and with the port community.”
   Unions representing longshoremen and U.S. seafarers also sent a letter expressing concern to Oberstar about plans “to alter the existing regulatory framework governing U.S. liner shipping trades without prior agreement among the liner shipping companies, shippers and seafaring and longshore labor.”
   Oberstar is expected to introduce his bill to end antitrust protection for the liner industry soon, possibly this week.
   “With the serious short-term capacity crisis over, we firmly believe through your good offices, the carriers, shippers, and labor can be brought together to address what actions the industry and government should take to mitigate against any such crisis in the future,” the union leaders' letter said.
   “The ocean shipping industry, unlike the airline industry, has no barriers to entry. This fact, coupled with the fact that the ocean shipping industry is not concentrated at all, can and should be taken into consideration by the carriers and shippers and others when determining what type of regulatory system is warranted. ' Chris Dupin