Shipping Conferences Under EC Antitrust Law Criticism of a Legal Paradox

Liner conferences are among the oldest surviving cartels in the world. Created in the 1870's they have existed since on all the world's shipping routes. With the approval or tacit acquiescence of governments everywhere, they fix freight rates, control capacity and share markets. The United Nations Code of Conduct for Liner Conferences (1974) granted them global recognition and prompted the EC to recommend Member States to join the Convention on the Liner Code (1979) and to grant them the most generous and extraordinary block exemption from EC antitrust rules ever (1986).

The EC Commission's administration of the block exemption has clarified some of its aspects and, to a certain extent, limited its scope; but until very recently, it has not questionned the appropriateness of the exceptionally lenient treatment of liner shipping cartels in the EU. After a report by the OECD Secretariat (2002) recommending abolition of antitrust immunity for shipping cartels in member countries, the European Commission launched a review of the block exemption (2003) which has not yet finished, and suggested that the authorisation for liner conferences should either be repealed by severely limited.

This book studies first the origins, the early history and the regulation of liner conferences in the world and in the EC, focusing in particular on the regulation which granted a block exemption to liner conferences. Then, it examines one by one the four conditions for a block exemption to be granted under EC law, and concludes that none of them is fulfilled by shipping cartels. Finally, it recommends that the block exemption is repealed and proposes some alternative scenarios and solutions for the adequate enforcement of antitrust law in the maritime sector.