MDS Transmodal and Global Shippers Forum stress lack of competition in global liner market

MDS Transmodal (MDST) and Global Shippers Forum (GSF) have concluded that current measures of competitiveness in the global liner shipping market are incomplete. This means they are essentially inaccurate and fail to take full account of the degree of cooperation between carriers which results in a more highly concentrated industry, to the serious detriment of shippers worldwide.

This conclusion is one of the findings presented in the Container Shipping Market Quarterly Review for Quarter 1 2022 prepared by MDST, in collaboration with GSF.

That is why a modified measure is proposed, based on the alternative indicators suggested in a recent study produced by OECD/ITF and MDST, which according to a statement, better reflects the degree of cooperation by box lines.

Competition authorities until now have relied on traditional but incomplete tools to assess the level of concentration across trades, most commonly the Herfindahl–Hirschman Index (HHI). However, this indicator does not take into consideration the full extent of co-operation between shipping lines permitted under block exemption and other anti-trust immunity provisions. When these ‘inter-Alliance’ consortia are included the concentration of the market, as measured by the modified HHI, is much higher.

GSF urges the US Federal Maritime Commission and all other competition authorities to utilise the more accurate MHHI measure in its assessments of the container shipping market, and in particular of the concentration in market share achieved through all agreements permitted under block exemption and anti-trust immunity provisions.

Source: hellenicshippingnews.com


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