No C 59/10 Official  Journal  of the European  Communities 8. 3. 78 
Opinion  on transport  problems  in relations  with  Eastern  Bloc  countries 
The opinion  of the Committee  does  not relate  to any  particular  text. 
A. LEGAL  BASIS  FOR  THE  OPINION 
At its 139th  plenary  session  held  on 25 and  26 May  1976  the Committee,  acting  on a pro-
posal  from  its Bureau,  decided  to deliver  an opinion  on the abovementioned  subject  on its 
own initiative. 
B. OPINION  OF THE  ECONOMIC  AND  SOCIAL  COMMITTEE 
The Economic  and Social  Committee  drew  up its opinion  at its 153rd  plenary  session  held  in 
Brussels  on 23 and  24 November  1977. 
The hill text  of the opinion  is as follows: 
THE  ECONOMIC  AND  SOCIAL  COMMITTEE, 
Having  regard  to the decisions  taken  by its Bureau  on 
24 May  1976  and  25 January  1977  authorizing  the 
Section  for Transport  and  Communications  to prepare 
an own-initiative  opinion  on transport  problems  in rela-
tions  with  Eastern  Bloc  countries, 
Having  regard  to the additional  opinion  issued  by the 
Section  for Transport  and  Communications  at its 116th 
meeting  held  on 4 November  1977, 
Having  regard  to the  report  and  appendices  thereto 
submitted  by the rapporteur,  Mr Hennig, 
Having  regard  to its initial  opinion  of 22 June  1977  on 
the matter, 
Having  regard  to the discussions  at its 153rd  plenary 
session  held  on 23 and  24 November  1977  (meeting  of 
23 November), 
Having  regard  to Article  15 and the fourth  paragraph  of 
Article  20 of the Rules  of Procedure, 
Whereas: 
1. The  steadily  mounting  competition  from  the East-
ern Bloc  has been  a source  of concern  to politicians 
and representatives  of the two  sides  of industry  in 
the European  Communities  for some  considerable 
time now  on account  of the  conditions  under 
which  it is flourishing.  By virtue  of their  centrally 
controlled  economies,  Eastern  Bloc  countries  are succeeding  to an increasing  degree  in changing 
the pattern  of East-West  goods  traffic  in their  own 
favour. 
2. For  a number  of reasons  (systematic  expansion  of 
fleets,  chronic  shortage  of foreign  exchange,  etc.), 
the Eastern  Bloc  is doing  its utmost  to have  its 
imports  and  exports  carried  fob/cif  by Eastern 
Bloc  operators.  Eastern  Bloc  partners  normally 
succeed  in having  fob  and  cif clauses  inserted  in 
trade  agreements  and  supply  contracts,  especially 
as the countries  of the  Community  have  so far 
shown  more  interest  in increasing  their  volume  of 
foreign  trade  than  in acquiring  a larger  share  of 
traffic. 
3. In some  transport  sectors  Eastern  Bloc  countries 
can be seen  to be pursuing  a policy  of low  freight 
rates  which  does  not accord  with  customary  prac-
tice in the West. 
4. Even  though  definite  threats  are already  looming 
large  over  sea transport,  waterway  shipping  and 
road  haulage,  Eastern  Bloc  countries  are still  pro-
ceeding  to establish  or expand  their  own  networks 
of representatives  and cargo-handling  agencies  and 
are causing  growing  concern  amongst  transport 
users  and  port  services  as a result. 
5. Intent  on acquiring  regular  cargoes,  Eastern  Bloc 
shipping  lines,  and especially  those  from  the Soviet 
Union,  are offering  freight  rates  that  are not  in 
8. 3. 78 Official  Journal  of the European  Communities No C 59/11 
keeping  with  normal  commercial  principles.  Fleet 
expansion  plans  have  also  developed  a momentum 
of their  own  not dictated  by economic  or commer-
cial considerations.  Once  the new  container  ton-
nage  appears  on the market,  competition  in sea 
transport  will  most  likely  be stepped  up further 
and could  very  soon  threaten  the  existence  of 
western  liner  companies. 
6. To  a large  extent,  Eastern  Bloc  transport  organiza-
tions  have  already  gained  a stranglehold  on road 
haulage  between  the  Community  and  Eastern 
Europe.  In this  sector,  just  as in sea  transport, 
competition  problems  are being  posed  by the sus-
tained  expansion  of Eastern  Bloc  transport  capac-
ity in bilateral  traffic  between  Eastern  Bloc  and 
Community  countries  and in third-country  traffic. 
7. Similar  problems  exist  in inland  waterway  ship-
ping.  On  the  waterways  covered  by the  Act  of 
Mannheim  (Rhine  Shipping  Act),  passenger  and 
cargo  vessels  have  complete  freedom  regardless  of 
the flags  they  fly. In cross-frontier  traffic  there  are 
neither  government  regulations  on rates  nor  re-
strictions  on access.  Thus,  shipping  lines  from 
COMECON  countries  are  still  allowed  by the 
Rhine  riparian  States'  free  market  economies  to 
freely  canvass  for cargoes  and push  their  way  into 
traffic  with  the  Rhine  riparian  States.  Once  the 
Main-Danube  Canal  has  been  completed,  this 
problem  will  grow  worse,  since  Eastern  Bloc  ves-
sels, which  have  so far  operated  only  on the 
Danube,  will  then  be able  to penetrate  West  Euro-
pean  markets  unimpeded  unless  measures  are 
taken  in good  time. 
8. Another  disquieting  aspect  is the fact  that  Eastern 
Bloc  firms  are freely  able  to set up offices  in the 
Community  and,  in the field  of maritime  shipping, 
fly the flags  of the Member  States  of the Com-
munity  under  the  guise  of Western-based  com-
panies. 
9. Finally,  employment  in  transport  may  be 
threatened  by Eastern  Bloc  operators'  penetration 
of the markets  — a factor  which  is already  causing 
workers'  representatives  some  concern. 
10. In the long  run  the  events  described  above  will 
probably  have  serious  drawbacks  for industry  in 
the Community  as a whole,  at the very  latest  when 
the Eastern  Bloc  has succeeded  through  a deliber-
ate market  policy  and  a certain  amount  of negli-
gence  on the  part  of the  West  in building  up monopolies  in the various  transport  sectors.  This 
not only  may  mean  total  economic  dependence  but 
also seems  undesirable  on  general  political 
grounds, 
HAS  ADOPTED  THE  FOLLOWING  OPINION: 
with no votes  against  and  four  abstentions: 
1. General  comments 
1.1. The  Committee  has ascertained  that  it is primarily 
sea transport,  inland  shipping  and road  haulage  and also 
to a lesser  degree  port  activities  and  ancillary  services 
that are  affected  by the  expansion  of Eastern  Bloc 
countries'  share  of traffic,  which  is threatening  the sur-
vival  of Western  operators. 
1.2. Less  disquieting  it would  seem,  is the situation  in 
air and  rail transport.  These  sectors,  in which  traffic  is 
controlled  in the  main  by a regulatory  framework, 
where  also  examined  by the Committee.  This  does  not 
mean,  however,  that  it will  not be necessary  in future  to 
keep  a very  careful  eye on air and rail transport  in order 
to prevent  rates,  for  example,  from  diverging.  The 
Committee  thinks,  nonetheless,  that  any  problems  can 
be settled  within  the framework  of existing  agreements. 
1.3. The  Committee  hopes  that  an effective  solution  for 
other  modes  of transport  (sea  transport,  inland  shipping 
and road  haulage)  can also  be negotiated. 
1.4. It considers  that  concrete  grounds  for such  action 
are to be found  in the Final  Act of the Helsinki  Confer-
ence of 1 August  1975,  where  it is stated  in Section  II 
that: 
'The participating  States  . . . consider  that  their 
trade  in various  products  should  be conducted  in 
such a way  as not to cause  serious  injury  — and 
should  the situation  arise,  market  disruption  — in 
domestic  markets  for these  products  and  in particu-
lar to the detriment  of domestic  producers  of like  or 
directly  competitive  products  . ..' 
The participating  States  also  agreed  to 'encourage  the 
development  of international  inland  transport  of pas-
sengers  and  goods  as well  as the possibilities  of ade-
quate  participation  in such  transport  on the basis  of 
reciprocal  advantage'.  And  at a general  level  reciprocal 
measures  to develop  commercial  and economic  relations 
by improving  'business  contacts  and  facilities'  were 
promised. 
No C 59/12 Official  Journal  of the European  Communities 8. 3. 78 
The conclusion  regarding  trade  drawn  here  from  the 
major  differences  between  the two  sides'  economic  sys-
tems,  should  the Committee  thinks,  also  serve  as the 
guiding  principle  for the policy  to be pursued  with  re-
gard to transport. 
The practical  successes  not scored  so far on this  front 
must  be made  a certainty  in future  by using  more  suit-
able methods  than  have  been  used  so far. 
1.5. The  Committee  is, however,  aware  that  — as the 
Helsinki  Agreement  shows  — agreements  by themselves 
are no guarantee  that  an intolerable  situation  will  be 
terminated.  The  Committee  therefore  calls  on the Com-
munity  bodies  to equip  themselves  as soon  as possible 
with suitable  legal  instruments  for taking  counter-action 
in the event  of serious  disturbances  on the transport 
market. 
Such  legal  instruments,  however,  do not  rule  out 
negotiations  between  the Community,  represented  by 
the Commission,  and  the COMECON  or COMECON 
States  — negotiations  which  might  thereby  prove  to be 
more  fruitful. 
2. Specific  comments 
2.1. Subject  to its basic  comments  on what  form  action 
should  take  and  where  the  responsibilities  lie,  the 
Committee  holds  the views  set out below: 
It is in the transport  industry's  interest,  the Committee 
thinks,  to work  towards  the following  common  targets 
in international  traffic  between  the  Community  and 
East European  State-trading  countries: 
— Community  land  and  sea operators  should  have  a 
fair share  of East-West  traffic.  The purpose  of efforts 
here must  be to prevent  the COMECON  countries 
from  reaping  all the benefits  and to work  towards 
effective  and  — at all events  — evenly  matched 
reciprocity.  It would  appear  advisable  to do some-
thing  about  the cif and  fob  clauses  in supply  con-
tracts  so as to ensure  equal  access  to the market. 
— Workers  employed  by Community  operators  should 
be ensured  legal  and  social  protection  when  in East-
ern Bloc  countries. — The  administrative  formalities  in international 
transport  — and  especially  at frontiers  — should  be 
simplified  and aligned. 
— The  special  taxes  and  discriminatory  charges  in 
COMECON  countries  should  be abolished. 
— The  transport  activities  of COMECON  countries 
should  be monitored  in order  to guarantee  reci-
procity  with  regard  to the right  of establishment, 
the acquisition  of holdings  and  the  access  to 
cargoes/loads. 
— The  setting-up  of businesses  and acquisition  of hold-
ings in the  Community  by COMECON  firms 
should  be regulated. 
These  general  objectives  can be attained  most  effectively 
if efforts  are concentrated  primarily  on ensuring  that 
both  sides  have  fair  access  to markets  and  to car-
goes/loads.  On a general  level,  it must  be emphasized 
once  more  that  the competitive  disadvantages  of Wes-
tern operators  stem  from  the fact  that  the State-owned 
transport  organizations  in the  COMECON  countries 
restrict  the customer's  choice  through  their  trading  and 
transport  policies. 
A Community-wide  solution  includes  ipso  facto  ap-
propriate  checks  at Community  level  to verify  the ob-
servance  of agreements. 
It is imperative,  the Committee  thinks,  for the targets 
set out below  to be achieved  in the separate  transport 
sectors: 
2.2. Sea  transport 
In the  field  of sea  transport,  the  appropriate  bodies 
must  take  suitable  action  to ensure  the following: 
— COMECON  countries  should  be made  to drop 
freight  rates  that  are in no balanced  relation  to the 
normal  terms  in Western  countries. 
— Community  shipowners  should  be given  a balanced 
share  of bilateral  traffic  between  Community  and 
COMECON  ports  in both  directions,  at adequate 
rates  and  without  carriers  from  other  countries 
being  excluded. 
— West  European  shipowners  should  be given  the 
chance  to acquire  a share  of traffic  between 
COMECON  ports  and  ports  outside  the  Com-
munity. — Consideration  should  be given  to the social  aspects 
of the problems  posed  in East-West  transport  by 
unfair  competition  and  especially  to the  employ-
ment  question  and  the repercussions  on other  sec-
tors of the economy. — Eastern  Bloc  shipping  lines  should  be allowed  to 
accede  to existing  agreements  between  Western 
shipowners. 
8. 3. 78 Official  Journal  of the European  Communities No C 59/13 
2.3. International  road  haulage 
The following  are the main  measures  that  spring  to 
mind  for giving  Western  road  hauliers  an equal  share  of 
traffic  between  Member  States  and  Eastern  Bloc  coun-
tries: 
— Agreements  on equal  access  to the market  through  a 
system  of licences  for bilateral  and  transit  traffic. 
— Agreements  on access  to loads  by ensuring  the free-
dom of establishment  coupled  with  possibilities  for 
securing  loads  (if need  be, traffic-sharing  agreements 
could  be concluded). 
— Ban  on exorbitant  road  tolls  and transit  levies. 
— Rules  governing  the picking  up of return  loads  or 
additional  loads  in transit. 
— Reduction  in the  high  visa  fees  charged  by 
COMECON  countries  and  introduction  of perma-
nent visas  for lorry  crews. 
— Recognition  of the  green  insurance  card  by all 
COMECON  countries,  thus  putting  an end  to the 
need  for separate  insurances  to be taken  out  for 
vehicles. 
— Simplification  and  acceleration  of customs  proce-
dure. 
— Guarantee  of adequate  stop-overs  for lorry  crews. 
— Legal  protection  for lorry  crews  involved  in acci-
dents. 
2.4. Inland  waterway  shipping 
The Rhine's  special  status  is a central  factor  here. 
Competition  in inland  shipping  is determined  primarily 
by the  legal  regimes  applicable  to the  international 
waterways.  Here,  too,  there  is need  for  protection 
against  cut-throat  competition  from  East  European 
operators;  such  protection  will  be needed  even  more 
after  the completion  of the Main-Danube  Canal. Navigation  on  the  Rhine  by  vessels  from 
COMECON  countries  should  be  restricted  to 
two-way  traffic  between  a Rhine  riparian  State  and 
the COMECON  country  in question. 
— It is necessary  to retain  the complete  ban  on cabot-
age applicable  to waterway  vessels  operating  outside 
the Rhine  area. 
— The  requisite  arrangements  could  best  be laid  down 
in trade  agreements  incorporating  transport  clauses 
or in special  transport  agreements  of equal  value. 
If transport  clauses  in trade  agreements  do not suf-
fice, detailed  rulings  on the questions  of bilateral 
traffic,  cabotage,  transit  traffic,  the picking  up of 
return  loads  or additional  loads  in transit  and 
third-country  traffic  will be necessary  in the special 
transport  agreements. 
— In addition,  agreements  should  be drawn  up on the 
alignment  of technical  matters  (vessel  registration, 
certificates,  navigation  licences)  and  on safety  as-
pects. 
Suitable  monitoring  procedures,  e.g.  quota  restrictions, 
must  be introduced  to ensure  that  treaties  and  agree-
ments  are observed. 
2.5. Air transport 
It can be concluded  from  the Committee's  studies  that 
as they  are guided  by different  motives  and avail  them-
selves  of different  opportunities,-  East  European  airlines 
obtain  different  results  to their  West  European  counter-
parts. 
As a result,  East  European  airlines  have  a larger  share  of 
traffic  and a stronger  foothold  on the market. 
The Committee  thinks,  however,  that  existing  agree-
ments  still provide  an adequate  basis  for proper  cooper-
ation  and  desirable  improvements  in the  areas  men-
tioned  above.  Work  should  continue  on this  matter. 
Experience  has shown  that  inland  waterway  operators 
cannot  protect  themselves.  Agreements  between  States 
on East-West  traffic  must  therefore  be reached  by the 
appropriate  authorities. 
— Top  priority  must  be given  to amending  the Act of 
Mannheim  so that  it will  be possible  to restrict 
navigation  on the Rhine  by vessels  from  countries 
other  than  EEC  Member  States  and Switzerland. 2.6. Rail  transport 
Distortions  in traffic  distribution  at the expense  of West 
European  railways  are the result  of the COMECON 
countries'  endeavours  to use their  own  means  of trans-
port as far as possible.  Rail  transport  must  be included 
in any East-West  traffic-sharing  agreements. 
No C 59/14 Official  Journal  of the European  Communities 8. 3. 78 
2.7. Transport  users'  interests 
The Committee  notes  that  the industrial  users  of trans-
port represented  in its midst  show  an understanding  for 
the ideas  for restoring  competition  from  COMECON 
carriers  to normal.  Here,  too,  there  is an awareness  of 
the longer-term  risk  of a growing  dependence  on East-
ern Bloc  transport  operators. 
Therefore,  a better  balance  and  a certain  reciprocity 
should  be sought  with  regard  to the  distribution  of 
goods  traffic.  This  would  be for the  benefit  of the 
Community's  carriers,  though  the interests  of industrial 
transport  users  would  also  not be disregarded. (b) even  if they  do succeed,  these  branches  are restricted 
in their  freedom  of movement;  and 
(c) genuine  reciprocity  is therefore  unattainable,  the 
establishment  by COMECON  countries  in the 
Community  of agencies  or firms  coming  under  their 
control  should  be supervised. 
This restriction  or ban  should  include  firms  which  are 
controlled  directly  or indirectly  by natural  or legal  per-
sons from  a COMECON  country  or by such  a country 
itself.  Control  here  means  the de jure  or de facto  in-
fluencing  of the firm's  decisions  with  regard,  in particu-
lar, to the use of transport  means  or market  strategy. 
2.8. Preventing  abuse  of the freedom  of establishment 
in general  and  in sea ports  in particular 
The Committee  has noted  that  Eastern  Bloc  operators 
have  established  permanent  agencies  in neighbouring 
Western  countries  (e.g.  in sea ports),  whereas  Western 
carriers  and  forwarding  agents  are not able  to set up 
such establishments  in COMECON  countries.  Eastern 
Bloc  operators  can  thus  not  only  compete  freely  for 
cargoes,  but also  keep  a direct  eye on developments  in 
the different  markets;  full  use is also  made  of the busi-
ness opportunities  they  find.  This  gives  Eastern  Bloc 
operators  a major  competitive  advantage. 
In view  of this  situation  and  the fact  that: 
(a) it is difficult  for western  firms  to set up branches  in 
COMECON  countries; 
Done  at Brussels,  23 November  1977. Special  attention  should  be paid  not  only  to vessels 
whose  home  ports  are in COMECON  countries  but 
also to vessels  which  are registered  in a West  European 
country  but  whose  owners  are  either  citizens  of a 
COMECON  country  or under  such  a country's  control. 
Finally,  freedom  of establishment  in COMECON  coun-
tries would  have  to be backed  up by appropriate  free-
dom to secure  cargoes  in these  countries  and  by im-
proved  access  to cargoes  before  it could  be said  that 
Western  carriers  were  given  the same  treatment  as their 
Eastern  Bloc  counterparts. 
The Committee  would  ask all the competent  institutions 
to tackle  this  matter  with  the utmost  vigour  in order  to 
ward  off developments  that  would  be disastrous  for the 
economy  and  have  grave  social  consequences. 
The Chairman 
of the Economic 
and Social  Committee 
Basil  de FERRANTI 
8. 3. 78 Official  Journal  of the European  Communities No C 59/15 
ANNEX 
to the opinion  of the Economic  and  Social  Committee 
The following  passages  in the Section's  opinion  were  replaced  by amendments  accepted  during  the 
Committee's  discussions: 
Paragraph  1.3 
'The Section  concludes  that  it would  be desirable  to introduce  a similar  framework  of agreements 
for sea transport,  inland  shipping  and road  haulage.' 
Voting 
Unanimous. 
Paragraph  1.5 (second  sentence  onwards) 
'It therefore  thinks  that  the Member  States  and the Community  should  strengthen  their  negotiating 
position  by equipping  themselves  with  suitable  legal  instruments  for dealing  with  market  abuses  by 
COMECON  States  if negotiated  terms  are not observed. 
In addition,  however,  negotiations  between  the Community,  represented  by the Commission,  and 
the COMECON  or COMECON  States  may  be the first  step  towards  finding  the desired  solution.' 
Voting 
Unanimous. 
Paragraph  2.2 
'The objectives  in the field  of sea transport  and the measures  to be taken  to achieve  them  must  be as 
follows:'. 
Voting 
Unanimous. 
Paragraph  2.4 
'— Top  priority  must  be given  to amending  or supplementing  the Act of Mannheim,  so as to make 
it clear  which  vessels  are to have  freedom  of navigation  on the Rhine;'. 
Voting 
For: 1, against:  43, abstentions:  42. 
Paragraph  2.5 
'Existing  agreements  form  a satisfactory  basis  at the moment  for proper  cooperation  in this  sector, 
though  they  should  be used  in future  to make  further  improvements,  especially  with  regard  to the 
fixing  of prices  and airlines'  footholds  on markets.' 
Voting 
Unanimous.