Credits: Venti Views/UnsplashHong Kong based consultancy Linerlytica says the expiry of Consortia Block Exemption Regulation (CBER) will have little impact on liner shipping and its critics have “overplayed” their hand.
CBER Renewal
“Given the small number and profile of consortia falling within the scope of the CBER, the CBER brings limited compliance cost savings to carriers and plays a secondary role in carriers’ decision to co-operate. Furthermore, over the evaluation period, the CBER was no longer enabling smaller carriers to cooperate among each other and offer alternative services in competition with larger carriers.”
Linerlytica, however, argues: “The impact of the EU CBER expiry on 25 April 2024 on the liner shipping market has been overplayed by the carriers and their detractors. Of the 43 consortia that operated in the European Union in 2020, only 13 actually qualify for the block exemption while the remaining consortia exceed the 30% market share ceiling including each of the three global alliances.”
Post-CBER Era
The cessation of CBER is expected to fortify existing alliances, particularly THE Alliance and Ocean Alliance, which are less likely to dissolve before their 2027 contracts expire, as per Linerlytica, although the rationale for this prediction remains unspecified.
However, the World Shipping Council (WSC)’s, president & CEO John Butler said:
“The shift to general EU antitrust rules will create a period of uncertainty as carriers adjust to the new legal structure. Nevertheless, vessel sharing agreements will remain a fully legal and supported way for carriers to ensure efficient and sustainable transport for Europe.”
