EU Investiages Shipping Companies

From Bloomberg News

European Union regulators opened an antitrust investigation into container liner shipping companies, saying they signaled pricing changes to each other with press and website statements.
“Since 2009, these companies have been making regular public announcements of price increase intentions through press releases on their websites and in the specialized trade press,” the EU said in an e-mailed statement today. “These announcements are made several times a year and contain the amount of increase and the date of implementation, which is generally similar for all announcing companies.”
The pricing announcements may allow the companies to signal future pricing plans to each other and could allow them to raise prices on transport services to and from Europe, regulators said.
The European Commission didn’t identify the companies in the probe in today’s statement.
AP Moller-Maersk A/S, owner of the world’s largest container shipping company, CMA CGM SA and Hapag-Lloyd were among companies raided by EU officials in 2011 over possible collusion. EU regulators are also gathering market information over a pact between Maersk, CMA CGM and Mediterranean Shipping Co. to create the largest container alliance.

Shipping companies have not yet understood how they should operate without the price collusion they were accustom to in the old days of conferences.  It's a new world,  but they just don't get it.

Air Cargo carriers fined by EU

The list of the aircargo carriers fined for price fixing has been made known.

They are; Air France-KLM, British Airways, Cargolux, SAS, Singapore Airlines, Air Canada, Quantas, LAN Chile, Martinair, and Japan Airlines.

From DW World

The European Union's competition watchdog issued fines Tuesday to 11 airlines totaling 799.4 million euros ($1.1 billion) for running a global cargo cartel.

The cargo carriers were found to have coordinated their action on surcharges for fuel and security over a six-year period, between 1999 and 2006.

Air France-KLM was hit with the largest fine of 310 million euros. British Airways came in second, having to pay a 104-million-euro penalty. Luxembourg's Cargolux will have to pay 79.9 million euros, while Scandinavian carrier SAS was ordered to pay 70.2 million euros.

Other airlines involved in the cartel and slapped with fines were Singapore Airlines, Air Canada, Quantas, LAN Chile, Martinair and Japan Airlines.

The Commission said it dropped charges against eleven other airlines, including German carrier Lufthansa and its subsidiary Swiss Air, because it was the first to provide information about the cartel.

French capture pirates - turn over to Kenya for prosecution

The other day I wrote about the Canadians who captured pirates, only to turn around and release them. I thought this was rather pointless, but
A commented explained the reason for this

The pirates cannot be prosecuted under Canadian law because they did not attack Canadian citizens or interests and the crime was not committed on Canadian territory.

At least the French don't have this problem.

They captured pirates who were attempting to hijack a Liberian flagged tanker. The pirates (excuse me, accused pirates)are being turned over to Kenya for prosecution.

From the BBC

A French naval frigate has docked in the Kenyan port of Mombasa carrying 11 Somalis accused of piracy.

French commandos captured the men last week after an attempt to hijack a Liberian tanker.

The Somalis will be handed over to Kenyan authorities for prosecution under a special agreement with the EU.

EU to scrutinize bunker adjustment factors

No sooner than I wrote these words in my post regarding the average price of bunker

I think it's a little hard to justify a bunker surcharge based on these figures

Lloyds List advised

Brussels to police liner sector's bunker adjustment factors

Watchdogs will “vigorously enforce the competition rules in order to prevent any attempt to compensate the fall in base rates by increasing BAFs and other surcharges and ancillary charges via anti-competitive practices”, the minutes show.

However, I think the guy at Nestle has a better idea of the problem

A prominent shipper last week called for greater transparency in the assessment of fuel levies and other surcharges.

Nestlé head of global ocean transport Brett Whitfield told an industry audience that many lines were unable to explain how their BAFs were calculated.

That reflected a wider problem among box lines of failing to understand their cost base, he claimed.

Carriers have been exempt from anti-trust regulations for so long, they don't know how it works in a competitive world.

Mr Whitfield also said carriers had not taken advantage of the opportunities available under the new legal environment, with “a lot of confusion” about how best to respond to customer requirements.

If international containership lines were smart, they would try to hire people from the airline industry, who have gone through the deregulation and pains of operating in a competitive environment.

Although, 30 years after deregulation of the airlines, they are still having lots of problems.

EU considering more rule changes for liner shipping

Traffic World reports EU's Competition Directorate (referred to as DG Comp), has given ocean carriers notice they are considering changing the rules, some more:


"A new DG Comp proposal threatens to limit liner carriers' ability to share vessel capacity through alliances, slot exchanges and vessel-sharing agreements.

The draft proposal for consortia regulation came just as the liner industry is adjusting to the Oct. 18 end of a 150-year-old system of rate-setting conferences in European trade lanes.

Carriers were shocked by the proposal's assumption that there is no competition among carriers that are members of alliances or vessel-sharing agreements, and that these kinds of consortia would be considered as single entities when measuring an agreement's market share."

If this goes through, look for more mergers in the international shipping industry.

European Group to Patrol Somali Waters

From the BBC Oct. 2nd.

"The European Union has agreed to establish an anti-piracy security operation off the coast of Somalia.

French Defence Minister Herve Morin said at least eight countries have agreed to take part.

The announcement came as the International Maritime Bureau (IMB) reported a further three attempts to seize ships overnight."
The eight participating countries were not named in this article.