The UK’s Competition and Markets Authority (CMA) has decided not to recommend replacing the current Consortia Block Exemption Regulation (CBER) with a UK equivalent after it expires on April 25, 2024. This decision has been met with approval from UK freight forwarders, particularly the British International Freight Association (BIFA).
The CMA conducted a thorough analysis of the deep-sea container shipping market, exploring various scenarios. In November 2023, the authority concluded that the existing conditions did not justify the continuation of a CBER for UK maritime movements – a stance echoed by the European Commission. Despite second opinions being sought, the CMA maintained its initial decision, emphasizing that self-assessment remains the most effective means for shipping lines to cooperate.
Steve Parker, Director General of BIFA, expressed support for the decision, stating, “The decision confirms the provisional recommendation made by the CMA in November 2023 and is a sensible conclusion to the ongoing container market public consultation that has been conducted by the CMA since the start of last year.”
BIFA had previously voiced concerns over practices by container shipping lines and exemptions granted to them, asserting that such actions distorted the free market, adversely affecting international trade, businesses, and consumers.
While acknowledging that the regulatory change won’t terminate shipping line consortia and alliances, Parker highlighted its potential to enable greater and continuous scrutiny of such arrangements. He emphasized the need for shipping lines to be fully subject to competition law, a move that BIFA and its members advocate. Parker called on the Secretary of State for Business and Trade to uphold the CMA’s decision.
In clarifying BIFA’s position, Parker stated, “BIFA, and its members, are not anti-shipping line. Members recognize that shipping lines are essential parties in the global supply chain and hope that this decision will create a suitable balance between shipping lines as carriers and its members as customers. This, in turn, could lead to the establishment of a long-term, stable, and successful deep-sea container market that serves the best interests of all engaged in international trade.”
This decision is poised to bring about increased transparency and accountability in the container shipping sector, fostering fair competition and addressing concerns raised by industry stakeholders. The outcome aligns with the ongoing efforts to maintain a healthy and balanced global supply chain.
