Opinion of the Committee of the Regions on the communication of the Commission concerning 'The development of short sea shipping in Europe: Prospects and challenges` (96/C 129/06)

On 18 July 1995, the Bureau of the Committee of the Regions decided to draw up an opinion on the above-mentioned communication.

Commission 3 was given the task of preparing the work of the Committee of the Regions in this area, and appointed Mr Yvon Bourges Rapporteur.

Commission 3 for Transport and Telecommunications met on 10 October 1995. A preliminary draft Opinion was submitted to the attention of its members by the Rapporteur. The aim was to stimulate an exchange of views on the subject, and to arrange for those working in shipping to play a part in the deliberations of the Committee of the Regions through your Commission's opinion.

On 8 November this year, a working party met in Brussels at the Committee of the Regions. The Rapporteur of the European Parliament, members of Commission 3, representatives of the European Commission and those working in shipping were able to express their position on short sea shipping.

Commission 3 met again on 14 December 1995 to give final form to this opinion.

At its 11th Plenary Session, held on 17 and 18 January 1996 (meeting of 18 January), the Committee of the Regions adopted the following Opinion.

INTRODUCTION

Since the beginning of the century, the average annual growth in shipping has been around 3 %. Shipping accounts for 30 % of intra-Community trade. It is the second mode of transport in Europe after road transport (which represents 37 % of trade).

This sector is characterized by very cyclic activity, with supply and demand subject to unpredictable factors in the economy (globalization of trade, and increased competition) in policy (organization of trade and developments in modes of transport) and in the climate.

For several years there has been a noticeable concentration of traffic around a few large carriers, and at the same time, small companies have occupied 'niche` markets.

This trend has been coupled with a deterioration in economic and financial results for firms in the sector: this is explained partly by high running costs and tariffs. In order to alleviate these difficulties, some countries have instituted special schemes for investment grants, tax incentives, or specific arrangements to cover social security contributions. These provisions have made it possible, for instance, to hire, in crews, more foreigners whose wages are lower than those for nationals. We have also seen some fleets or crews transferred to countries, within the European Union itself, which have a more favourable tax regime.

Another marked current trend is for operators to develop multimodality: increasingly they bring in complementary modes of transport, and extend their networks by taking over transport companies or forming partnerships (vertical combination).

Lastly, within the framework of the WTO (formally GATT), shipping is one of the sectors for which no definitive agreement has yet been reached. However, the reduction of tariff barriers might be one of the factors indicating an upturn in world trade in general, and shipping in particular.

This tends to prove that it would be the right moment to define and implement, at a European level and in each Member State, a real development strategy for shipping in general, and short sea shipping in particular.

BASIS FOR ACTION

In view of the Treaty establishing the European Communities and Article 3 which proposes 'the introduction of a common transport policy`,

In view of the White Paper of 6 April 1992 on the future development of the common transport policy (doc. COM(92) 96 final) adopted by the Council in June 1993,

In view of the communication from the Commission on 'The common transport policy: Programme for action 1995-2000` (doc. COM(302) 95 final),

1. The Committee of the Regions feels that in this communication, the European Commission deserves credit for opening the debate on the future development of the common transport policy; it has set itself the aim of strengthening the place of short sea shipping within the context of effecting one large single market in transport in Europe with fair competition for all modes of transport and for optimum utilisation of transport capacity, and it bases itself on three powerful ideas: making improvements in the quality and efficiency of coastal shipping services; the development of portinfrastructure and port efficiency; and the preparation of coastal shipping for the enlargement of Europe. In accordance with the principles of the White Paper, each mode of transport and each port must rely on its own qualifications, and there must be fair competition. The necessary harmonization in this sector raises sensitive and complex issues which the Commission has also tried to bring up in its communication.

2. The Committee of the Regions is anxious to emphasize the positive role that short sea shipping can play in the search for a more balanced development of the various modes of transport in the service of intra-Community trade. The marked trend towards congestion of land transport, and the high cost of transport infrastructure (rail and road) reinforce this point of view.

Furthermore, the constant growth of intra-Community trade makes it possible to foresee major shifts to sea transport for traffic currently handled on land.

In fact, European geography offers a huge and currently under-used network of sea and river routes, and Community shipping has a direct potential for growth, leading to opportunities for economic development to the advantage of Europe's peripheral regions quite as much as for the industrial centres of Europe.

Lastly, the development of short sea shipping can only contribute to the preservation or creation of jobs in the European Union and become a major aspect of a policy for strategic development within Europe.

3. The Committee of the Regions welcomes, therefore, the Commission's proposals; some of them have already been adopted or even put into effect by the European Union; others need to be better defined before being implemented; others, finally, are worth taking further, or clarifying or even strengthening

In fact, the question of short sea shipping must be approached in a comprehensive manner. It must have a place in shipping policy in order for consideration to be given to an integrated approach to the problems of port infrastructure and the regulations in force, and a place in other transport policies, with a view towards multimodal trans-European networks, and with the aim of freeing congested land corridors. It is vital and urgent to lessen the high cost of short sea shipping so that it may play its part to the full in the distribution of traffic into modes of transport, with the dual concern for a rational use of communications infrastructures, and balanced strategic planning.

A strongly assertive policy by the European Union and the Member States ought to support these aims and free the resources for them.

Local authorities, too, have an important role to play in the implementation of measures designed to encourage short sea shipping.

OBSERVATIONS

The Committee of the Regions, therefore, puts forward the following observations to the Commission and the Council:

4. Short sea shipping offers certain advantages (lower energy consumption, reduced environmental impact, greater cost-effectiveness of maritime and port investments compared with land transport), but it must still overcome a number of structural, institutional, legal or operational imbalances which act as a brake on its development.

5. The diversity of the special provisions, and of the regulations in Member States, constitutes an obstacle to the implementation of a common shipping policy in Europe. The achievement of a single market in shipping, and short sea shipping in particular, is largely contingent upon the adoption of rules which place users and shipowners in competitive market conditions.

6. Short international sea shipping must be subject to the same conditions as those applicable to land transport. It is, therefore, in achieving the convergence of competitive conditions between Member States that it will be possible to reassert the competitiveness of Community shipping.

However, this determination to achieve convergence does not emerge explicitly in the Commission's document as a priority, but as a middle or even a long-term objective.

In this connection it is appropriate:

a) that the principle of entry onto the Community's EUROS register is systematically applied. Heterogeneity of conditions for assigning the nationality of the vessel, and disparities in tax depending on the location of the shipping company's head office perpetuate competitive imbalance. Transferring to the flag of a non-Member country with cheaper labour has harmful consequences for the employment of seamen originating from the European Union. As a result, it is desirable to begin by filling the gaps in the definition of a Community shipowner, and to give consideration to the creation of a 'European` flag;

b) that the question of harmonizing legislation and regulations relating to working conditions and employment status of European merchant seamen is broached in practice (in conferring expatriate status upon them, for instance, as is the case with northern States); the current lack of legal clarity is leading to social dumping that is unacceptable in Europe;

c) that the operating conditions for the ports in the various Member States, concerning the movement of goods by sea, are brought closer together - firstly on an industrial level by harmonizing competition and transport conditions. On an economic level, rather than the legal status of the ports, it is in working habits and customs that it is appropriate to seek convergence;

d) that the Commission includes in its Green Paper on 'the principles for the allocation of external costs for the use of transport infrastructure` the principle of a fairer distribution of external costs for transport to the benefit of shipping;

e) that the Commission proposes incentives facilitating the financing of merchant ships (coasters, and ro-ro and container vessels); this would allow imbalances to be avoided in the activities of European dockyards, and to renew the coaster fleet, which has an average age of over 20 years old;

f) that abuse of the monopoly on operations ports be avoided, with a view to moving gradually towards competition on equal terms.

7. Amongst the obstacles to be overcome, the Committee of the Regions is particularly aware of the need to simplify the administrative procedures, which could paralyse the development of short sea shipping.

8. In the Commission's document, short sea shipping covers coastal navigation and, by extension, sea-river traffic: this clearly enlarges the possible fields of involvement, with varying potential depending on the field. There is a concealed danger of paying unduly detailed attention to the problems surrounding the great inland waterways of the centre of Europe to the neglect of others. The specific characteristics of coastal shipping could be worked on further, and become in turn the subject of detailed proposals.

9. Starting from the principle that the revival of short sea shipping may contribute in a significant manner to the development of business in medium-sized and small ports, the Committee of the Regions would like to see hard-and-fast measures put forward for the growth potential of these ports to be better exploited.

The development of transhipment ports, for instance, would make possible a revival of business in small and medium-sized ports, with investments in low-cost port infrastructure. In this connection, inter-port cooperation is possible and desirable, and ought to be promoted at European level.

Funds could, moreover, be allocated to a certain number of test or pilot markets, which, by demonstrating their efficiency, and without entailing a distortion of competition, could serve as a benchmark in the promotion of short sea shipping for these ports.

10. It would be helpful to incorporate the conclusions of work carried out by the regions of the Atlantic seaboard on the subject of short sea shipping - regions which were not taken into account by the Commission in drawing up this communication.

This work should be incorporated into the communication on the same footing as work carried out on the ports and traffic of the North Sea, the Baltic and the Mediterranean, thus taking in the Community shoreline in its entirety. The studies carried out on the eight corridors contribute interesting aspects to a discussion on the development of short sea shipping, but cannot serve as an exclusive reference-point to future proposals for concrete action - other corridors may be contemplated.

11. The setting-up of the Maris programme opens up interesting prospects. The creation of a maritime information highway can have only positive repercussions on the development and efficiency of the services offered by European short sea shipping.

In terms of image, short sea shipping must be seen as a mode of transport based on high technology, and one that is readily accessible. The Committee of the Regions suggests that the Commission carries out experiments in two or three pilot regions capable of accommodating these advanced technologies.

12. Lastly, it would be desirable for the Commission and the Council to specify clearly the detailed arrangements for access to European funding for port projects of shared benefit. Even though the ports do not feature in the maps of trans-European network plans, the machinery for eligibility and for the funding of projects supported by the European Union should include them on account of their role in general economic development and in the territorial balance of Europe, in particular for the development of the hinterland of the port areas. The Committee of the Regions wishes that in any event they are included in the budget allocation devoted to trans-European transport networks which will be renegotiated in 1999.

CONCLUSIONS

13. In order to give weight to the Commission's already attractive - if incomplete - proposals, it would be desirable that an appropriate initiative should enable short sea shipping to fulfil its role entirely in European transport policy.

14. The Committee of the Regions is inclined to concur with the Commission's thinking on this important subject. It expresses its satisfaction with the reference made by the Commission to the subsidiarity principle, and wishes to see this principle applied to the areas that fall within the powers of regional and local authorities.

15. Short sea shipping transport policy can and must represent a significant asset in definition of territory.

Local and regional authorities must be consulted and must play an active part in the decision-making procedure in fields relating to them, particularly in the configuration of port infrastructure, traffic management and environmental affairs.

Done at Brussels, 18 January 1996.

The Chairman of the Committee of the Regions

Jacques BLANC