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Europe’s ban on shipping conferences has led to greater rate volatility, costs and supply chain instability but the true impact of this ban cannot be determined due to the impact from the global economic downturn, according to the Shipping Gazette citing the American Shipper.

Europe has had two years of ban on conferences. These preliminary opinions have been gathered by the US Federal Maritime Commission (FMC) in the course of its investigation and determination of the fate of the current antitrust immunity still enjoyed by carriers shipping to and from the United States.

Maersk, among 16 respondents to the FMC request for opinion, was the most sanguine, saying the European Union ban in 2008, had produced little advantage to carriers or shippers.

But Maersk allowed it would be “easier to conduct an international liner shipping business if there were more common rules” – citing the proposed UN cargo liability treaty, or Rotterdam Rules, as a good example. NYK also said there has been no clear impact that can be identified since 2008.

Singapore’s APL said the global downturn “masked whatever separate impact the revocation of the block exemption may have had,” so it was not possible to “draw any meaningful conclusions about short- and medium-term impacts of the change in EU law.”

Hapag-Lloyd agreed, saying a more accurate assessment of the impact could only be made when the industry operated under normal economic conditions absent in the last two years, ruling out 2010 as a start because it had been an extraordinary year of recovery.

Hapag-Lloyd pointed to a resulting rate volatility over the past two years than the major non-EU trades. It believes this relates at least in part to the stabilising influence that comes from carriers being able to share market information and discuss general rate trends and establish voluntary rate guidelines.

Evergreen, famous for operating outside the conference structure, agreed: “The increasing volatility of shipping market made it harder for small-size carrier to survive the market downturn”, adding that “the abolition increased the volatility of shipping markets, which affected the stability of supply chains”.

The Japanese Shipowners Association, the least sanguine, said antitrust immunity is “indispensable for the healthy development of the international shipping industry, as well as the whole international trading industry. The immunity system is the international regulatory norm, as it is permitted in virtually all major trading nations around the world.” The association also said supported the decision by Singapore to extend immunity through the end of 2015 without any significant change. – Source: Shipping Gazette


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