US lawmakers are making another attempt to repeal the antitrust exemption that allows ship-sharing agreements by ocean carriers. It is the second attempt after an earlier effort failed to attract support last year, reports an Alphaliner article.
According to the publication, California Congressman Jim Costa has reintroduced the bipartisan ‘Shipping Antitrust Enforcement Act,’ which would nullify carriers’ exemption from federal antitrust laws, potentially affecting not only major alliances but also to other vessel exchange agreements.
They report that the proposal would also remove antitrust immunity for US terminals and give the US Department of Justice more direct authority over transportation agreements. The bill is now awaiting action by the House Judiciary Committee.
Passage of the bill remains uncertain, however, after an earlier attempt to pass the legislation, also sponsored by Costa, failed in 2022. Meanwhile, a companion bill introduced at the same time in the Senate last year past met with opposition from both port and port. labor interests, including the American Association of Port Authorities (AAPA) and the International Labor Association (ILA), reports Alphaliner.
They ensure that the prospects for the approval of the new bill are considered “low probability, but high impact.”
The World Shipping Council said it would work with the bill’s sponsors to better understand its goals, but commented: “No one has offered a reason why we should scrap such a useful tool as ship-sharing arrangements… part of the rhetoric stems from a misunderstanding about how VSAs help supply chains work better,” Alphaliner reports.
Supporters of ship-sharing agreements and the block exemption in the EU argue that rather than being anti-competitive, ship-sharing benefits shippers and consumers by allowing “more services, to more places”, in particular to smaller ports that would otherwise be ignored, Alphaliner reports.
They mention that the bill’s sponsors say it would ‘untie the hands of federal regulators’ (the US Department of Justice, the Federal Trade Commission and the FMC) ‘to defend American exporters, shippers and consumers of unfair trade practices by the foreign-flagged ocean. carriers’ including:
· Collusion and anti-competitive business practices that are illegal for any other transport sector
Unjustified and unilateral container rate increases
Exorbitant detention and demurrage fees
Unexplained shipping times
· Outright reject cargo reservations for US exports, such as agricultural products, apparently at any price.