Business at Sea - Navigating through EU Competition Law

Abstract: The shipping industry is of great importance within the European Union since approximately 90 per cent of the Unions external trade goes by sea. There have been several block exemptions that have enabled, and simplified for liner consortia to cooperate and on the 26th of April 2010 a new exemption will enter into force. This thesis focuses on this new exemption and its aim is to investigate under what forms liner shipping companies can cooperate after the new exemption has entered into force. To enable this, an extended legal method is used with a broad source material ranging from doctrine to case law, EU regulations and interviews with representatives for the shipping and competition law sector. Initially a brief introduction to the history of shipping and EU competition law as well as the economics behind competition law is made. Following is a presentation of different forms of cooperation where cartels, liner conferences, joint ventures, consortia and information exchange agreements are mentioned. Also the possibility for leniency within the EU is discussed. Subsequently, the scope of the hard core restrictions cited in the new group exemption, price fixing, allocation of markets or customers and limitation of capacity or sales, are accounted for and referred to through case law which to seeks to identify useful guidelines for non-deterrence of EU competition law. The scope and conditions for the new group exemption is then discussed. Throughout the thesis a discussion regarding the different matters is held and comparisons are made with US antitrust law and foremost economic theory. Finally, the results of the thesis are presented with advices for how liner shipping companies and consortia should act in matters regarding horizontal cooperation after the new block exemption enters into force. Amongst these are the advices to expand the economic skills and focus of the liner shipping companies as well as to deepen information exchange programs.