WORLD SHIPPING COUNCIL DISMISSES CONCLUSIONS OF OECD

WORLD SHIPPING COUNCIL DISMISSES CONCLUSIONS OF OECD    The World Shipping Council, the Washington-based body that represents ocean carriers, has dismissed the pro-competition recommendations of the Organization for Economic Cooperation and Development published in its final report on competition policy in liner shipping.
   “It remains baffling that the OECD staff can study the liner shipping industry and issue a report saying the industry is not sufficiently competitive – at the very same time that intense carrier competition has caused rates to fall to their lowest level in twenty years and is causing the industry to lose massive sums,” a spokesman for the World Shipping Council said.
   The carrier body said that the OECD secretariat’s “continued devotion to its economic theory was not unexpected.” The World Shipping Council had earlier criticized the draft report of the OECD, saying that it contained insufficient evidence to reach conclusions on the market impact of liner conferences.
   The OECD’s final report urged governments to consider removing the antitrust immunity of liner conferences and discussion agreements. As a compromise, if no consensus can be reached on the ending of the immunity of carriers, the OECD also suggested the adoption of the three pro-competition principles.
   Commenting on the latest, final report, the carrier body said that the OECD report’s three recommended principles – freedom of contract, confidentiality of contracts, and freedom for carriers to pursue operational and capacity agreements – are already current practice under the U.S. Ocean Shipping Reform Act.
   “These three principles can, and are meant to, coexist side by side with the current, regulated exemption in the liner shipping sector,” a World Shipping Council spokesman said.