Opinion on the communication from the Commission to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions entitled 'The development of short sea shipping in Europe: Prospects and challenges'

(96/C 97/05)

On 10 August 1995, the Commission decided to consult the Economic and Social Committee, under Article 198 of the Treaty establishing the European Community, on the above-mentioned communication.

The Section for Transport and Communications, which was responsible for preparing the Committee's work on the subject, adopted its Opinion on 17 January 1996. The Rapporteur was Dr Bredima-Savopoulou.

At its 332nd Plenary Session (meeting of 31 January 1996), the Economic and Social Committee adopted the following Opinion with no votes against and three abstentions.

1. Introduction

On 5 July 1995 the European Commission presented its long-awaited communication on the development of short sea shipping in Europe. The communication - which is not a legal text but a policy document - includes an analysis of the potential of short sea shipping and of current problems, and an action programme with the aim of stimulating further discussion leading to specific proposals. It is worth noting that the communication is the fruit of many years' discussions on the short sea sector at European level under the auspices of the European Commission. The development of the single market was a basic factor contributing to the promotion of short sea shipping.

1.1. Transport 2000+

The report () by the Group Transport 2000 Plus under the aegis of the European Commission (1989), entitled 'Transport in a fast-changing Europe - Towards a European network of transport systems', was the first to note that, if measures are not taken to alleviate congestion in the various modes of land transport, and especially in road transport, European land transport will fall victim to a 'Verkehrsinfarkt' - a kind of 'traffic heart attack'. The preventive therapy would be to transfer goods from land to other transport modes, and particularly to short sea shipping and sea-river transport. The idea of transferring goods from land to sea is also aired in other Commission documents, such as the communication on the future development of the common transport policy (December 1992) (), and the Green Paper on the impact of transport on the environment (February 1992) (). In other words, short sea shipping is expected to have the potential to help relieve congestion in other forms of transport.

1.2. Maritime Industries Forum/Short Sea Panel

1.2.1. The catalyst for promoting short sea shipping was the MIF () under the aegis of Commissioners Bangemann and Van Miert. At the plenary meeting of the MIF (Genoa, October 1992) it was decided that promotion of short sea shipping should be a basic activity of the MIF, through the setting-up of the Short Sea Panel (Panel I).

The MIF Short Sea Panel analyzed existing disincentives to the use of short sea shipping and sea/river transport. The Panel's recommendations concentrate on five points:

1. improvement of infrastructure and efficiency in and around ports;

2. simplification of administrative procedures;

3. fair competition between sea and land transport modes;

4. improved marketing of short sea shipping and of sea/river transport;

5. introduction of advanced technologies.

More specifically, the above five points are broken down as follows:

1) Port infrastructure

- greater flexibility in working methods and working hours in ports;

- flexible and transparent pricing;

- need for action against harmful monopolies;

- introduction of modern techniques;

- incorporation of ports into a combined transport network (given that many ports are not linked up with the road/rail network of their hinterland, and delays occur).

2) Administrative procedures

The shipping industry must be in a position to employ administrative procedures which are as simple as those for other modes of transport. The main problems noted are:

- transit and customs procedures;

- VAT;

- veterinary checks;

- regulations on the transport of dangerous goods;

- obstacles of any kind which make it more difficult/unattractive to transfer goods from land to sea transport.

3) Fair competition between sea and land transport

I.e. the creation of competition on equal terms, by means of internalization of the external cost of land transport.

4) Need for improved marketing of short sea shipping

I.e. information and publicity about short sea shipping is inadequate, with the result that potential users are insufficiently aware of the existence of short sea services as alternative transport:

- frequency of port services;

- reliability;

- attractive pricing;

- short transit times in door-to-door transport;

- a single contracting party.

5) Introduction of advanced technologies

This plays an important role in improving the services supplied to users of short sea shipping. Special attention must be given to new types of ship and to new technologies for rapid loading/trans-shipment in ports. Electronic Data Interchange (EDI) and the Commission's R& D programme will help to achieve this aim.

It should be noted that most of the above points have been taken into account in the communication on short sea shipping.

1.3. As a step towards action based on the above recommendations, the MIF Short Sea Panel played a leading part in the creation of local and national Round Tables to promote short sea shipping at national level on the basis of national conditions. The initial results of the Round Tables, particularly in the North, are encouraging. The South is following with a slight time-lag. On 4 and 5 May 1995 a workshop of national/local Round Tables was held in Marseilles: participants were encouraged to propose pilot projects, and 20 such projects are already awaiting the Commission's attention.

1.4. The aim of transferring goods from land to sea is consistent with the nature of short sea shipping, since it is:

- the most economic mode of transport in terms of energy consumption (per kilometre/tonne);

- the most effective mode of transport in terms of investment/transport capacity ratio;

- the most suitable mode of transport for serving peripheral regions of Europe, especially northern and southern regions, but also areas such as Ireland, the Black Sea and the Baltic Sea;

- the most environmentally-friendly mode of transport (statistically, marine transport accounts for only about 14 % of marine pollution, with the remainder coming from other sources);

- virtually free of detrimental effects for society (such as traffic congestion, noise) of land transport.

2. Main points of the communication

2.1. The communication examines the contribution which short sea shipping can make to implementing the basic principle of 'sustainable mobility' (), i.e. mobility compatible with environmental requirements. Its main aim is to promote the shift of goods transport from land to sea. This aim is described as minimizing the land aspect and maximizing the sea aspect of transport.

The communication analyses the potential of short sea shipping under three headings:

- improving the quality and efficiency of short sea shipping services;

- improving port infrastructure and port efficiency;

- preparing short sea shipping for a wider Europe.

2.2. Improving the quality and efficiency of short sea shipping services

Short sea shipping services will be given a boost by the Community's fourth R& D framework programme. The Maris (Maritime Information Society) programme and its subprogramme Matrans for logistics receive special mention. EDI will also contribute to promoting short sea shipping, as will the expected liberalization of marine transport within Member States (cabotage) on the basis of the schedule laid down in Regulation No 3577/92.

2.3. Improving port infrastructure and port efficiency

Ports operate as links in the chain of combined transport (in which the short sea shipping must be integrated) and of trans-European transport networks (TENS). It is therefore necessary to adopt measures to improve them. The Commission is promoting transparency in port tariffs. A list of state subsidies for ports is being drawn up, and guidelines will be issued for the application of Article 92 of the EC Treaty, dealing with such subsidies. Similarly, application of the competition rules (Articles 85, 86 and 90 of the Treaty) will help to eliminate port monopolies. The activity of local and national Round Tables supported by the Commission will assist in arriving at practical solutions.

2.4. Preparing short sea shipping for a wider Europe

Development of short sea shipping must take account of the future broadening of the European Union's activities. A series of EU agreements with the Baltic, Eastern European and Mediterranean countries will result in increased trade and transport links; and hence in greater opportunities for the development of short sea shipping. The Commission has already set up - on the basis of the conclusions of relevant regional congresses - working parties on the development of waterborne transport in the Baltic, the Mediterranean and the Black Sea. Each working party will draw up a multi-annual work programme which will aim to promote short sea shipping.

2.5. The communication includes an action programme and five Annexes:

2.5.1. Annex I: The advantages of short sea shipping

The communication analyses the geographical and ecological advantages and stresses the low energy consumption.

2.5.2. Annex II: Growth potential of short sea shipping

Annex II states that a study co-financed by the Commission (the 'Corridors Study') has examined the competitive position of short sea shipping in eight important EU trade corridors, three of which extend beyond its external borders. The study demonstrated that there are growth opportunities for short sea shipping, i.e. opportunities for shifting trade from land transport to short sea shipping, in at least six of the eight corridors.

2.5.3. Annex III: Challenges for short sea shipping in Europe

This Annex on the one hand analyses the structural obstacles to the development of efficient short sea shipping services (lack of integration with combined transport, uncompetitive pricing, administrative formalities for transit and veterinary checks, unattractive image of the services). On the other, it analyses problems of port infrastructure and port efficiency (delays, high port dues, labour problems).

2.5.4. Annex IV: An integrated policy approach for short sea shipping in Europe

Annex IV identifies the non-integration of short sea shipping in the chain of multimodal transport as the main problem facing this type of shipping.

2.5.5. Annex V: Statistical data

The communication notes that the lack of reliable statistics and comparative data impedes assessment of the situation and renders proper planning impossible.

3. General comments

3.1. In recent years, the European Commission's activity has increasingly concerned itself with sea transport (). The communication constitutes an important Commission initiative aiming to shift goods traffic from land to sea (). Despite any difficulties or doubts as to the feasibility of the operation, it is clear that if this aim is achieved there will be multiple benefits for the environment, consumers and the short sea sector, and positive effects on the employment of seamen. This is a thorough, systematic study of the short sea sector, in which the influence of the MIF Short Sea Panel's conclusions is evident; the Commission should make further use of these conclusions. The ESC regrets that the Commission has not yet created the policy context in which the Short Sea Panel's recommendations will be followed up. It should also be pointed out that the Commission communication does not go into the problems of flags of convenience and the crews of ships sailing under them (i.e. of open ship registers and below-standard crews). It is also clear that these problems affect coastal shipping and give rise to considerable distortions of competition of marine transport and in relation to other modes of intra-Community transport, by undercutting international social and safety standards.

3.2. It is not the first time that the ESC has studied the development of short sea shipping. In its earlier Opinion on Community guidelines for the development of the trans-European transport network, the ESC expressed its interest in the forthcoming publication of the communication on short sea shipping (). In its Opinion on the Legislative Commission programme for transport, the Committee also welcomes the publication of the communication on short sea shipping ().

3.3. Definition of short sea shipping

3.3.1. The communication gives the widest possible definition of short sea shipping: it covers all sea transport which is not ocean-going. In other words, it includes coastal shipping, transport between mainland coasts and islands, intra-Community shipping (between Member States), shipping within Member States (cabotage) and sea-river transport by ship to and from inland river ports. Geographically, it extends beyond the limits of the EU, to Norway, Iceland, the Black Sea, the Baltic and the Mediterranean area. An example of the kind of confusion that can be caused by the lack of a proper definition is that, in Annex V, Table 11 refers to an arbitrary dividing line between short sea and deep sea ships; but no such dividing line exists. Ships of 6 000 GRT are entirely suitable as ocean-going vessels, while large tankers are habitually used on short sea voyages. The size of ships is independent of their type of use.

3.3.2. The ESC notes that this definition will need to be further refined when later legislation is introduced to achieve the aims of the communication, in order to specify the beneficiaries as well. It is also doubtful to what extent the term 'short sea' is appropriate for describing all the above modes of transport, given that some of them are not even short-haul.

3.3.3. The ESC also points out that the short sea sector covers a wide range of diversified activities and services which are by no means homogeneous. Basic types of service in this area include bulk transport, ferries, feeder services and liner services. This is not sufficiently analysed in the communication. At all events, it will need to be taken into account in the formulation of specific policy measures.

3.4. Bulk transport

The communication covers mainly goods transport, and secondarily passenger transport. However, it is doubtful whether the analysis of the problems or the proposed measures take sufficient account of the bulk transport sector. The communication is concerned mainly with liner transport, which normally forms part of combined transport. However, bulk transport - which constitutes 50 % of short sea shipping - deserves more detailed examination in the document. As was rightly stated recently, maritime transport, and particularly maritime bulk transport, is the cinderella of transport (). It is worth noting that the MIF Short Sea Panel's remit clearly covers bulk transport.

3.5. Ferries

The communication does not appear to take into account the important role played by ferry (including ro-ro) services in intra-Community transport. They are also of vital importance for certain remote islands and regions. Where such services carry the full economic costs and comparable road and rail services do not pay the full external costs, the competitive disadvantage for ferry services should be removed, or, on environmental grounds, reversed.

3.6. Feeder service

Feeder services connect hub ports with smaller ports not directly served by very large deep sea containerships. These services are probably the fastest growing sector within short sea shipping and their role will continue to grow. As to the proposed measures proper weight does not appear to be given to this important market.

4. Proposed studies

4.1. The communication envisages a large number of studies. The ESC believes that perhaps not all these studies are necessary to achieve the basic aim of the communication, i.e. the shift of goods transport from land to sea. It therefore recommends that, depending on the choice of studies, priorities be set on the basis of practical objectives, so as to maximize the effectiveness of Community resources in promoting short sea shipping. Timely consultations with the social partners in the shipping sector will contribute to achieving this.

4.2. Study of the eight trade corridors

The 'Corridors Study' (covering the eight trade corridors) sought to use typical examples to identify possibilities for shifting goods transport from land to sea routes. Although the study suggests that in absolute terms the freight volume which can be transferred is not at first sight very high in comparison with road transport, it is considered that, even this proportion contributes to reducing congestion on roads. Moreover, it must not be forgotten that the study in question does not exhaust all the possible goods/markets which could be transferred from land to sea routes. Moreover, it entirely ignores sea transport within Member States (cabotage) and confines itself to cross-frontier transport. Thus further coverage is required here.

4.3. Image of short sea shipping

The ESC agrees with the communication's stress on the need to improve the image which short sea shipping has among potential users, so as to make it a commercially attractive alternative mode of transport. The sector's image is outdated; moreover, it suffers as a result of the very complicated bureaucratic procedures for goods transit in ports. Given that it is basically small and medium-sized enterprises which are involved in short sea shipping, the use of advertising, information, EDI and advanced technologies is very limited. Particularly for EDI development, the regional funds of the EU could contribute to the funding of the necessary investment.

4.4. Transit/Veterinary checks

The detection and elimination of superfluous bureaucratic checks (especially in transit) is particularly important. In this context, sea transport must not be put at a disadvantage in relation to land transport. The Commission's intention to restrict veterinary checks to the port of final destination is endorsed, but draft legislation is needed as soon as possible.

4.5. Railways versus short sea shipping

The ESC notes that the communication focuses on comparing short sea shipping with land transport. It pays little attention to the relationship between rail transport and short sea shipping, or to competition between them (especially in northern countries). Despite the fact that rail transport is generally environment-friendly, competition between it and short sea shipping must be on equal terms.

4.6. Freight forwarders

Another disincentive with a negative effect on the competitiveness of short sea shipping - not mentioned in the communication - is the fact that freight forwarders in the EU, for a variety of reasons prefer to use road transport rather than short sea shipping.

4.7. Maritime cabotage

Given that maritime cabotage comes under the definition of short sea shipping, the communication (Annex IV) does not give sufficient coverage to the impact of cabotage liberalization on the basis of the timetable laid down in Regulation 3577/92.

4.8. The ESC feels that the role of small- and medium-scale ports in relieving congestion in large ports and on the main road links should be given greater emphasis and, where this would be justified, qualify for support from the Structural Funds or the Cohesion Fund.

5. Social dimension

5.1. The communication appears to ignore the social dimension of short sea shipping. Although the ESC acknowledges that to a certain extent the social problems of short sea shipping are of a horizontal nature, i.e. common to sea transport in general - and the Commission will deal with these general problems in other initiatives - nonetheless, specific social problems do exist in short sea shipping, and the communication ought to examine them. For instance, the lack of 24-hour working (in shifts) in certain ports reduces their productivity as a link in short sea/hinterland combined transport. The lack of flexibility in working conditions in certain ports further impedes the development of short sea shipping. Incentives in this direction should therefore be provided. These problems ought to be discussed by the Round Tables (attended by those properly concerned, including the social partners) with a view to finding practical solutions at the local level. The ESC acknowledges in any case that the development of short sea shipping will have the additional advantage of creating more job opportunities. Success will also depend on the quality of ships and seamen. Efforts to improve quality are all the more necessary because of the world shortage of qualified seamen.

5.2. There is therefore an urgent need at Community level for funding of programmes to attract and training Community citizens for seafaring jobs.

5.3. More stress should also be placed on initial and in-service training of the workforce at all levels, with funding from the European Social Fund. However, it must be acknowledged that progress has been made in the port sector in Europe generally, in terms of improving productivity through new investment in capital equipment and reorganization of working methods. As a result of this reorganization, the employment of dockers has been drastically reduced. In the long term, however, it is thought that the operational reorganization of ports will result in more jobs being created ().

6. Transparency

6.1. The ESC agrees with the view expressed in the communication that greater transparency is needed, but at the same time notes the need for transparency to be imposed on all links in the transport chain (road and rail transport, ports, maritime transport, river transport).

6.2. Specifically for ports, it must be made clear which tariffs and subsidies affect the port services proper and which concern other services. Ports must operate competitively, given that indirect subsidies exist. In parallel, it is necessary to strengthen the role of ports in the trans-European networks, since for the moment the ports are the 'poor relations' in those networks (). River ports will also have to be incorporated into trans-European networks.

6.3. It is equally necessary to determine what direct or indirect subsidies go to the other transport modes, so that competition between modes is not distorted by differences in costs caused by different degrees of official financial support. The underlying principle should be that each mode pays its full costs. Cross-subsidization of transport modes must be discouraged. This argument is developed particularly in the ESC Opinion on the 'Green Paper on the impact of transport on the environment: a Community strategy for sustainable mobility' (). It is also developed in the ESC Opinion on aids for transport by rail, road and inland waterway (Regulation 1107/70) (). The ESC understands that the recent Green Paper on the fair and effective pricing of transport will help achieve this.

6.4. The ESC regards as very positive the conclusions of the Council of Ministers for Industry (6 November 1995) on transparency and state aids. In particular, attention is drawn to the fact that the various EU policies (including transport policy) will be reviewed in connection with monitoring of state aids.

7. Statistics

7.1. The use of turnaround time in ports as a statistical criterion for comparing port productivity can produce misleading conclusions. This approach ignores the fact that short sea ships spend a greater proportion of their time in port than do ocean-going ships, on account of the normally shorter sea distances and the more frequent loading/unloading in ports.

7.2. In general, the available statistics on short sea shipping are of low quality. Producing improved statistics should not however involve excessive burdens or costs for the firms supplying the data concerned.

8. Subsidiarity

The proposed integrated policy fortunately covers the subsidiarity principle, i.e. the division of responsibilities at national and Community levels. However, efforts must be intensified to ensure energetic participation by the regions as well in order to achieve a better result. This could be achieved by involving the regions in the Round Tables.

9. Sea-transport strategy

9.1. The ESC hopes that the communication will be followed up, and that the short sea sector will receive due attention in the expected Commission document on sea-transport strategy.

9.2. The communication aims to stimulate further discussion leading to legislative measures. Although the communication achieves what it sets out to do, the ESC thinks it is now time to move on to the next stage. More action, less discussion. It is practical solutions which are needed, not more grand declarations. The Commission's enthusiasm for relieving traffic congestion through short sea shipping must be translated into specific measures which must form part of a broader transport policy. If appropriate steps are not taken, in a few years mobility will not be sustainable and an impasse will be reached. Shifting goods transport from land to sea routes is a complicated question, and its implementation depends on many factors. In view of the difficulty of the operation, the ESC would stress the contribution which the principle of subsidiarity can make to its success.

10. Specific comments

10.1. In Annex III, point 4, 'Difficulties in competitive pricing', applies only to liners. Non-liner transport usually has the opposite characteristic, i.e. high load factors and exceptionally competitive freight rates.

10.2. In Annex III.B, point 2, 'Port charges', the basic observation that short sea shipping is subject to disproportionately high port charges is correct. The ESC agrees entirely with the stress placed on reducing them. However, the difference mentioned between port costs per container in Northern and Southern Europe is not representative of the variations affecting bulk transport. For instance, the charges at a port on the west coast of Britain can sometimes be three or more times those at a Mediterranean Spanish port.

11. Conclusions

11.1. In the light of the above, the ESC thinks that urgent attention must be given to the following:

- enabling short sea shipping to compete on equal terms with the other transport modes through transparency of subsidies and future internalization of external costs; the role of the European Commission in defining and implementing this idea will be crucial;

- full integration of short sea shipping in the trans-European networks as an equal partner with the other transport modes;

- working out practical solutions to administrative problems affecting short sea shipping (e.g. customs/transit procedure);

- upgrading the role of small and medium-sized ports to relieve congestion in large ports and main roads;

- improving and expanding the study of the eight trade corridors;

- a clearer image of short sea shipping as a commercially attractive alternative mode of transport;

- continuing support for and coordination with the MIF Short Sea Panel and support for the work of the Round Tables;

- concentration on the social dimension of the short sea sector (and especially on training).

11.2. To achieve the above, it is necessary to draw up a list of priorities and introduce continuous monitoring of the relevant actions, with close cooperation between the Commission, the Member States and the MIF Short Sea Panel.

Done at Brussels, 31 January 1996.

The President

of the Economic and Social Committee

Carlos FERRER

() See ESC Opinion in OJ No C 49, 24. 2. 1992, p. 52.

() See ESC Opinion in OJ No C 352, 30. 12. 1993, p. 11.

() See ESC Opinion in OJ No C 313, 30. 11. 1992, p. 43.

() European Maritime Industries Forum.

() See ESC Opinion on the future development of the common transport policy - OJ No C 352, 30. 12. 1993.

() In its Opinion on the Legislative Commission programme for transport/the common transport policy action programme 1995-2000 (1305/95), the Committee concurs with the Commission's view that progress on transport policy matters was very slow during the EEC's first 25 years.

() A corresponding OECD study found that traffic congestion costs the developed industrialized countries 2 % of their Gross National Product (GNP). More particularly, the study finds that accidents account for 2 % of GNP, noise pollution 0,3 %, local pollution 0,4 %, total pollution 1-10 % in the long term; the whole time taken up by congestion costs 8,5 % of GNP, representing 2 % extra when compared with free flowing traffic. It is clear that the bulk of these costs derive from road transport - OECD/European Conference of Transport Ministers' study entitled 'Internalization of the Social Cost of Transport' (1993).

() OJ No C 397, 31. 12. 1994, p. 23.

() Opinion CES 1305/95.

() M. Everard (11. 4. 1995) - Reginald Grout Shipping Lecture.

() Sept./Oct. Bulletin 1995 - Netherlands Ministry of Transport.

() OJ No C 397, 31. 12. 1994, p. 23.

() OJ No C 313, 30. 11. 1992.

() ESC Opinion CES 1316/95, 22. 11. 1995.