THE Australian Competition and Consumer Commission, in its Container Stevedoring Monitoring Report 2020-21, argues that Part X of the Competition and Consumer Act should be repealed.
The section sets up a system through which international shipping lines can be given partial and conditional exemptions from cartel conduct in Australia. It allows lines to collaborate on prices, capacity and schedules, among other things. This would otherwise be considered anti-competitive conduct.
The ACCC, in its report, says there does not appear to be evidence of shipping lines charging excessive freight rates before the pandemic.
“However, the shipping industry has become more concentrated over the past decade, so there is a growing risk that shipping lines could use Part X to artificially elevate freight rates in the future,” the commission states in the report.
“Several other countries have already scaled back or removed equivalent exemptions. The ACCC is proposing to develop a class exemption, in place of Part X, which would allow for a more limited form of collaboration that would likely be in the public interest.”
Australian Peak Shippers Association secretariat Paul Zalai said he supports the views that the ACCC put forward on Part X. He said one of two things should happen:
“One is that we either remove all protections for international shipping lines; that shouldn’t prevent them from continuing their vessel sharing arrangements or alliances, it just means that they would have to do so in compliance with Australian competition law without the protections that Part X currently offers. And if they were found non-compliant, then they would feel the full weight of the regulator for any anti-competitive practices,” he said.
“The other position would be that if the federal government decides that a level of protection is required for the international shipping lines, then we would say it would be appropriate to create the role for a federal maritime regulator, or the ACCC itself, to administer it, rather than relying on an industry association to play the policeman role.”
APSA is the designated body under Part X to represent the interests of Australian shippers in relation to liner cargo shipping services.
