The shipping laws and policies of the EC find application in different circumstances, particularly the competitive laws and policies. The application of EC shipping laws and policies encompass the violations of the allowable limits of exemptions, abuse of collective power, and unfair competition practices particularly the lowering of prices and price fixing. One example is the French-West African Shipowners’ Committees case constitutes the first case where the Commission imposed a fine for a significant violation of Regulation 4056/86 together with Article 81 and 82 of the EC Treaty.
The decision emerged from findings of a cartel engaged in shipping to and from France and various countries in West Africa. The cartel imposed limits on quotas and procedures requiring compliance by parties involved in this shipping route . The Commission found these to constitute abuse of collective dominance because the operation and purpose of the cartel does not support a strong economic and competitive purpose so that the cartel does not qualify for the exemption.
This case reflects the stronger role assumed by the Commission in safeguarding against unfair competitive practices to allow competition to strengthen the shipping industry and improve services. A second example is the CEWAL line conference case, which aligns with the decision of the Commission in the previous case. The Commission imposed millions in fines to the CEWAL liner conference based on evidence that the conference abused its collective dominant position in eliminating its competition through price fixing via lower freight rates as well as rebates for loyal customers.
This case confirms the commitment of the Commission to regulate unfair practices, especially among conferences or other collective alliances falling within the exemption. Even with the exemption, operations should still be within the limits provided by laws and regulations. A third example related to the previous cases but comprising a different situation is the P&O/Stena Line case involving the application for an extension of the exemption of the joint venture agreement for the provision of cross-channel shipping services involving the United Kingdom as one party and Belgium and France comprising the other party.
The Commission extended the exemption for three years in 1999 and extended again for six years in 2001. The rationale for the extension is the substantial economic contribution of the joint venture in linking shipping between the countries involved . In addition, unlike in the previous cases, the joint venture does not involve unfair practice or abuse of collective power. A fourth example is the Roscoff case involving the application for access to the Roscoff port in Brittany, France of Irish Ferries.
Another company Brittany Ferries was the only firm transporting passengers from Brittany to Ireland. Irish Ferries negotiated with the organisation running the port, CCI de Morlaix, and the company believed that the agreement was already existent since December 1994 for implementation in May 1995. Due to this expectation, Irish Ferries sought to advertise its new route and started receiving bookings. However, CCI de Morlaix denied the existence of the agreement and denied Irish Ferries access to the port for the provision of its services.
Irish Ferries filed an action with the Commission, which ruled that the actions of CCE de Morlaix constituted the undue refusal to supply services comprising abuse of dominance under free access and competition laws and policies. The Commission ordered CCE de Morlaix to grant access to Irish Ferries based on a valid agreement. The decision implied two things. One is the speed with which the Commission settled the issue to ease the inconvenience for the shipping company and customers. The other is the expression of the equal protection accorded not only to existing players but also to new entrants, which is the essence of competition.