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UK freight forwarders embrace UK decision on container shipping rules

The United Kingdom's Competition and Markets Authority (CMA) will not recommend to the Secretary of State for Business and Trade that the current Consortia Block Exemption Regulation (CBER) be replaced by a UK equivalent when it expires on April 25, 2024.

CMA's decision has been welcomed by the country's freight forwarders.

After conducting a comprehensive analysis of the deep-sea container shipping market and investigating several scenarios, CMA concluded in November 2023 that the prevailing conditions did not justify the continuation of a CBER for UK maritime activities, a stance already confirmed by the European Commission.

"The decision confirms the provisional recommendation made by the CMA in November 2023 and is a sensible conclusion to the ongoing container market public consultation that has been conducted by the CMA since the start of last year," stated Steve Parker, director general of the British International Freight Association (BIFA).

Upon soliciting second opinions, CMA received additional input from BIFA, which provided supplementary information to reinforce its initial arguments. Having considered these perspectives, CMA has now upheld its original decision, concluding that self-assessment is the best and most effective way for shipping lines to cooperate.

"While this regulatory change, if implemented, will not end shipping line consortia and alliances, it will allow greater and ongoing scrutiny of such arrangements and ensure that the lines will be subject fully to competition law. That will be welcomed by BIFA and its members, and we call on the Secretary of State for Business and Trade to uphold the Agency's decision," added Steve Parker.

According to a statement, in the recent past, the UK's main trade association for freight forwarding and logistics firms has stated that its members are strongly worried that practices of container shipping lines, as well as easements and exemptions provided to them, have been distorting the operations of the free market to the detriment of global trade, businesses, and buyers.

Steve Parker further commented, "BIFA, and its members, are not anti-shipping line. Members know that shipping lines are essential parties in the global supply chain and hope that this decision will create a suitable balance between shipping lines as carriers and its members as customers, leading to the creation of a long-term, stable, and successful deep sea container market that is in the best interest of all who are engaged in international trade."

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