Global shipowners are making a fervent plea to the United Kingdom to diverge from the European Union and safeguard their interests from the impact of competition laws.
According to the Financial Times, this comes in response to the EU’s recent decision to revoke the industry’s exemption from antitrust rules, a move that has sent shockwaves throughout the global shipping sector.
The World Shipping Council (WSC), representing the largest container shipping groups worldwide, has implored the UK to act as a “sovereign nation” in the post-Brexit era and continue to provide immunity from competition regulations, similar to what some shipowners have enjoyed under British law.
The EU’s decision to eliminate the Consortia Block Exemption Regulation (CBER) from April next year has sent ripples across the shipping industry. CBER has traditionally allowed shipping lines to reduce costs by sharing vessels, thereby enabling them to operate more efficiently and cost-effectively. However, the EU deemed the exemption “no longer fit for its purpose” due to increased profits and consolidation within the industry.
Container carriers, already grappling with declining trade amid the global economic downturn, have faced a severe setback as a result of the EU’s decision. Their earnings have plummeted, adding further pressure to the industry.
In a joint letter, the World Shipping Council and the Asian Shipowners’ Association expressed their frustration with the EU’s decision, describing the findings as “deeply flawed” and “unsound.” Since the UK’s departure from the EU, the country has maintained the bloc’s exemption from antitrust rules for shipping consortiums with a market share below 30 percent. Nevertheless, this arrangement is set to expire in April, and the UK’s Competition and Markets Authority (CMA) intends to make a recommendation to the government on whether or not to renew it.