Freight News, Sea

Updated: P3 Alliance clears Brussels hurdle

[ June 3, 2014   //   Chris ]

The P3 Network alliance between CMA CGM, MSC and Maersk Line has passed an important hurdle – approval by the European Commission. In the European Union (EU), the P3 Network – which had already got the green light from the Federal Maritime Commission in the US in March – was required to conduct a self-assessment and on 3 June the European Commission informed the P3 partners that it did not plan to open proceedings.

The P3 partners have been in voluntary discussions with the European Commission to confirm the P3 partners’ view of P3 being in compliance with EU competition law.

The Commission said it would monitor the alliance to ensure it remained compliant with EU competition law, a move that was welcomed by the Global Shippers’ Forum. GSF secretary general Chris Welsh also called on the P3 to assist the Commission in monitoring compliance by providing reports on service performance on specific port pairs, vessel withdrawals including short-term withdrawals and information about future investment plans including future joint investment strategies that would impact on future capacity availability in the markets in which the P3 will operate.

He said “The P3 lines must now to step up to the plate and deliver on their promises of improved services and lower costs. Shippers will expect to see a wider range of services, enhanced service performance including improved service reliability and on time delivery. Above all, shippers expect to share in the benefit of more competitive freight rates through reduced costs”
He added: “Effective monitoring of P3 compliance with EU competition rules is absolutely essential in view of the unprecedented market power of the world’s three largest lines that collectively represent over 40% share in the world’s main liner trade, including over 46% market share in the Asia-Europe market. If there are any signs of a reduction in service quality or elimination in effective competition between the P3 lines and in the liner market generally we would expect immediate action by the European Commission including sanctions for competition abuses.”

In a statement, the P3 partners welcomed the Commission’s communication and said they would continue their close cooperation with competition and maritime authorities in China and South Korea and elsewhere to address questions and to explain the nature of P3.

 

Tags: CMA CGM, Maersk, MSC, P3