Singapore is seeking public feedback as to whether liner alliances should continue to be exempted from breaches of anti-competition laws.
The Competition Commission of Singapore (CCS) plans to extend the block exemption, first granted from 2006 and extended in 2010, for another five years until 2020.
The current exemption will expire on 31 December this year and Singapore National Shippers’ Council (SNSC) has been a vocal critic of the huge market share enjoyed by the alliances.
Just before stepping down, former SNSC chairman John Lu called on the commission to review extending the block exemption for liner alliances.
In justifying the exemption, the CCS said, “Liner shipping agreements enable the connectivity of Singapore’s container port with consequent broader benefits to the Singapore economy, and facilitate cost savings for the liners from economies of scale. These economic benefits are likely to be significant enough to outweigh any anti-competitive effects of liner shipping agreements.”
The commission said it has considered the impact of liner alliances on Singapore’s economy, especially with regard to shippers, port operators, liners and logistics service providers.
It also said it has been watching developments in the industry as well as regulatory developments overseas. The CCS has considered all views carefully before arriving at the proposed recommendation.
The commission said it will make a recommendation to the Minister for Trade and Industry after it has considered written feedback from the public.