The World Shipping Council (WSC), the International Chamber of Shipping (ICS), and the Asian Shipowners’ Association (ASA) have submitted their input to the European Commission, calling for a renewal of the CBER and demonstrating how vessel sharing contributes to the EU policy goals of reducing transport emissions, increasing competitiveness and improving efficiency to reduce costs, according to ICS's release.
Vessel sharing is a purely operational measure that enables carriers to use ships more efficiently whilst continuing to compete on price and other commercial terms. Vessel sharing expands the range of destinations and services available to customers and reduces empty space onboard ships, lowering emissions. The CBER facilitates vessel sharing by providing a sector-specific legal framework.
The Commission’s evaluation of the CBER takes place against the backdrop of an unprecedented global crisis. COVID-19 disrupted the intermodal supply chain worldwide, creating substantial bottlenecks at marine terminals, inland warehouses and distribution centres, and in the truck, rail, and barge systems that connect ports with the hinterland. Those landside issues in turn caused back-ups of ships outside of ports, significantly reducing the effective vessel capacity even as ocean carriers deployed every available owned and chartered containership. Reliability suffered and prices increased.
Whilst EU Block Exemption Regulations for consortia have been continuously in place since 1995, the Commission first adopted the CBER in its current form in 2009. It was adopted for a period of five years and, since then, it has been extended twice following Commission evaluations (first in 2014 and again in 2020). The CBER is due to expire on 25 April 2024 unless the present Evaluation results in a further extension.
The EU BER provides a clear legal framework within which ocean carriers can set up vessel sharing arrangements (VSAs) to improve operational efficiency without risking breach of competition laws. The CBER:
• Applies only for ocean carriers with a combined market share of below 30%
• Allows for vessel sharing agreements only, to improve service and efficiency
• Strictly prohibits exchange of information on rates. Each member of a VSA determines its own commercial terms, including prices.
• Carriers within a VSA compete with each other, and with other carriers outside of that VSA, when selling their services to customers. Additionally, carriers offer and add their own services outside of VSAs
The World Shipping Council is the united voice of liner shipping, working with policymakers and industry groups to shape the future growth of a socially responsible, environmentally sustainable, safe, and secure shipping industry.
ASA consists of members from the shipowners’ associations of Asia Pacific nations, i.e. Australia, China, Hong Kong, Japan, Korea, Chinese Taipei and Federation of ASEAN Shipowners’ Associations (FASA), consisting of Brunei, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. The ASA membership together is estimated to control about 52% of the world merchant fleet today.
The International Chamber of Shipping (ICS) is the principal international trade association for merchant shipowners and operators, representing all sectors and trades and over 80% of the world merchant fleet.