Vestager To Examine Competition In Global Container Market

EU Competition Commissioner Margrethe Vestager is more or less prepared to extend the major container carriers’ block exemption from the EU competition rules, which faces a European review ahead of an extension of the arrangement in 2020.

And Vestager adds that the EU Commission has now accounted for some of the widespread concerns among the carriers’ customers, the Danish commissioner told ShippingWatch.

Shippers have, through their organizations, such as Global Shippers Forum (GSF) and European Shippers’ Council, warned that the strong concentration especially among the biggest carriers, which starting this year have gathered into the three dominant alliances, could have a notable negative impact and be detrimental to the service level.

Criticism from the shippers has gained strength this year as the three alliances have introduced and adjusted their new route networks around the world, with the alliances controlling upwards of 90% of the capacity on certain routes.

According to Vestager, this concentration in the container industry, which due to the block exemption from regular competition rules is able to form alliances and vessel sharing agreements (VSA), reflects the concentration that characterizes numerous other sectors being monitored by regulators.

“There’s currently a strong competition in the container sector. And as long that’s the case, we’ve seen that the various alliances can exist alongside competition in the market,” Vestager tells ShippingWatch.

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