Opinion of the Economic and Social Committee on the "Proposal for a Directive of the European Parliament and of the Council on market access to port services"

(2002/C 48/27)

On 13 March 2001 the Council decided to consult the Economic and Social Committee, under Article 80(2) of the Treaty establishing the European Community, on the above-mentioned proposal.

The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for preparing the Committee's work on the subject, drew up its opinion on 6 November 2001. The rapporteur was Mr Retureau.

At its 386th plenary session (meeting of 29 November 2001) the Committee adopted the following opinion by 62 votes to 8 with 10 abstentions.

1. General presentation of the Commission document

1.1. In the Commission's view, maritime transport and port activities are likely to increase in scale, particularly as one of the alternatives to the problems raised by road transport.

1.2. The Commission therefore believes that three categories of issue should be resolved:

- the inclusion of seaports in the trans-European transport network (TEN-T);

- the systematic approach to regulating access to the market in port services;

- public financing of seaports and port infrastructures.

1.2.1. Seaports and the trans-European transport network (TEN-T)

1.2.1.1. European Parliament and Council Decision No. 1692/96/EC of 23 July 1996 on Community guidelines for the development of the trans-European transport network (TEN-T)(1) provides a broad framework for the establishment of an integrated, multimodal infrastructure network. This decision acknowledges that seaports have an important place in such a network, but agreement has not yet been reached on the choice of ports, their inclusion in the network, or the criteria on the type and volume of traffic.

1.2.1.2. The Commission takes the view that there is no justification for continuing to exclude seaports from the intermodal transport system, and it proposed that some 300 seaports be selected, using objective criteria, for inclusion in the outline plans; it also endeavoured to improve the definition of relevant projects of common interest relating to seaports. Its criteria were:

- seaports must be open to all commercial operators;

- volume of traffic: three million tonnes of goods or 500000 international passengers per year, with certain exceptions for the Greek islands;

- strategic importance ensuring territorial continuity between land links of the TEN-T.

1.2.1.3. At present the institutions are seeking agreement on this and, according to the Commission, seem to be approaching a solution.

1.2.2. Access to the port services market

1.2.2.1. Although the level of market openness varies from one Member State to another, even between different ports within the same Member State, all the Member States have chosen gradually to open up this sector to competition, in accordance with the competition rules of the Treaty and with the principles of free movement of workers and freedom to provide services.

1.2.2.2. However, a number of aspects peculiar to ports should not be forgotten: it can happen that ports provide only limited space; they also have a well-defined role to play in Community customs procedures; they have a special responsibility for maritime and on-shore safety and for protecting the environment. These considerations may justify restrictions on access to the market for the provision of certain port services. Nonetheless, a reasoned justification must be given for any restriction. What is more, the diversity of Community ports calls for a differentiated approach. It has been rightly pointed out that since no two ports are identical, many decisions on the level of openness of the port services market will be influenced by the characteristics of the port concerned.

1.2.2.3. Up to now the Commission has dealt with problems in applying the Treaty rules on a case-by-case basis. However, consultations have, in its view, shown that the idea of establishing a regulatory framework at Community level is gaining ground. It would be a matter of establishing more systematic rules on access to the port services market in ports which have international traffic, while taking proper account of the requirements of maritime safety and environmental protection, and, where appropriate, of public service obligations and the diversity of the ports concerned. These rules would form a framework for national measures which help to eliminate restrictions still in force in the port services market, while ensuring, on grounds of subsidiarity, that the local, regional and national characteristics of the ports are adequately respected.

1.2.2.4. This approach is not unanimously supported. The main objections are as follows:

- as the barriers to access to the cargo-handling market have mostly been removed, it would not be necessary to establish a new regulatory framework; but, in the Commission's view, this would not fit the situation throughout the Community, and in any case would not take account of the problem of procedural rules for granting authorisations;

- the port pilots and towage operators oppose the competitive regulatory framework envisaged; they wish to maintain the current structures on the grounds that they have made it possible to ensure high safety standards. For the Commission, this role does not in itself amount to a sufficient reason for excluding a priori these services from the scope of the Treaty rules or from a new regulatory framework at Community level.

1.2.2.5. Finally, the main difficulty would lie in reconciling the requirements of maritime safety and environmental protection - and where appropriate public service obligations - with a regulatory framework compatible with competitive operation.

1.2.2.6. In view of the complexity of the Member States' port regimes and of the diversity of ports with regard to size, status and function, and in view of maritime safety and environmental protection requirements, a directive is regarded as the most appropriate legal instrument, leaving the responsibility for implementing the provisions to the Member States.

1.2.2.7. According to the Commission, "port services" are defined as services of a commercial nature that are provided, for payment, to port users, this payment not being normally included in the charges collected for being allowed to call at or operate in a port.

1.2.2.8. The quality, efficiency and price-performance ratio of port services have become decisive factors in competition between Community ports.

1.2.2.9. Historically port services have been provided within a framework of exclusive rights and/or legal or de facto monopolies of a public or private nature. However, this situation is evolving and important changes are taking place, particularly in cargo handling, with new operators starting up - but not in a uniform way; these changes are not necessarily accompanied by clear and reliable procedural rules defining the rights and obligations of present and future service providers, as well as those of the national authorities responsible for supervising and/or selecting service providers.

1.2.2.10. The changes have not been of the same scale as regards other types of port services; barriers to access and private or public monopolies are still prevalent, particularly in port pilotage and - to a lesser extent - in towing and mooring.

1.2.2.11. The port administrations are apparently aware that this situation would result, among other things, in the supply of these services representing in some cases an abnormally high cost factor for port users and thus becoming an important element in competition between ports.

1.2.2.12. Nonetheless, the Commission recognises that certain restrictions can be justified by the specific situations and obligations of the ports.

1.2.3. Public finances and seaports

1.2.3.1. After an extremely thorough and detailed analysis of everything which it regards as state aid in the port sector, the Commission stresses the need to separate port services activities from other activities in the accounts of the port authorities, in accordance with the rules of private, general and analytical accounting. An "inventory" of public financing and charging practices drawn up by the Commission is found in Annex 2 to the Communication. These practices do not appear to be transparent and the procedures for selecting service providers do not in general appear to be fair or open, or at the very least appear to be inadequate.

1.2.3.2. It is said that none of the three accounting systems used in different ports is transparent, in the sense that none distinguishes commercial activities from the activities of public management of the port and its infrastructure, nor do they indicate (especially for municipal ports) the capital flows linked with specific activities. Criticism is directed at the public bodies for implementing rules of public accounting, and public financial law instead of commercial and financial accounting of a private type. The Commission therefore wishes to supplement the "transparency" Directive (2000/52/EC) with a legal obligation on seaports to keep separate general and/or analytical accounts for "commercial" and "public" activities.

1.2.3.3. As regards state aid, the Commission does not wish to draw up general guidelines on the state aid which could be authorised for ports, as exist for other sectors, and does not think it is in a position to provide the desirable clarification on the matter, mainly because there is little case law with regard to ports; it will continue to carry out case-by-case examinations, applying the general rules of the Treaty "where the facts and specificities of each case alone determine the outcome".

2. Reasons for and main provisions of the draft directive

2.1. Reasons

2.1.1. The justification for such a directive is that the market for port services is not at present covered by any specific regulatory framework, and the need to ensure their efficiency in the context of the liberalisation of sea transport which has occurred over the last ten years. Certain restrictions in access to the port services market have effects on the quality and cost of these services. Specific rules are therefore needed, in the interests of all, to eliminate the restrictions and establish a more systematic approach in combating state aid.

2.1.2. These measures should lead to competition within and between ports taking place on an equal footing. Although, in the Commission's view, the openness of this market has increased and continues to improve, the rules governing it are not yet sufficiently clear or generalised. Moreover, the Commission is presenting its proposal as following on directly from the conclusions of the European Council in Lisbon which invited the institutions and the Member States to "speed up liberalisation in areas such as ... transport".

2.2. Main provisions of the draft directive

2.2.1. The common rules applicable to the selected ports can be summed up as follows:

- no commercial port service should be excluded from the Community framework (a list is annexed to the draft);

- the Member States have the opportunity to draw up a transparent, well-proportioned and non-discriminatory system of prior authorisation on the basis of qualifications, safety and other criteria, including public service criteria; a legal appeal procedure is to be set up for the selection procedures; the rules on adjudicating and awarding public contracts apply, as do those on mutual recognition of vocational qualifications, provided that such a criterion is chosen for giving the authorisation;

- no limit is set for the number of authorisations to be granted, apart from the limits of space and maritime safety - the only ones which could restrict the number of service providers (which would be subject to checks); the principle is that of unlimited access; in the freight-handling sector, at least two service providers must be authorised in general terms; the port manager cannot impose a limitation if he is himself a service provider, nor can he manage the selection procedure which must in that case be managed by an independent body set up for that purpose;

- self-handling must be allowed as widely as possible subject to the same rules (security, qualification, etc.) as those applying to service providers;

- the managing body of the port must not receive any special treatment in relation to any other service provider; it must separate its port services accounts from the accounts of its other activities; an external audit of these accounts is set up, and the auditor's report must include information on financial flows between the managing body's different activities;

- the relevant authority designated by the Member States must provide adequate training to any operator when local knowledge is essential to any potential service provider;

- a time limit must be imposed on the activities of any service provider, but a distinction is possible between those who have made substantial investments and those who have made no or only insignificant investments;

- the transitional measures provide for a fairly rapid review ("within a reasonable timeframe") of the validity of the existing authorisations which were granted under earlier rules different from those laid down in the directive; the duration of the transition period will vary according to the level and type of investment made by the current authorised service providers;

- the directive and its implementation by the Member States must not compromise safety in ports, particularly maritime safety, nor the application of environmental protection rules;

- the institutional structures, rules on training and qualifications of staff and rules on equipment, safety and environmental protection are left to subsidiarity, without prejudice to existing Community law in these fields. Ownership arrangements are respected (in line with Article 295 of the Treaty);

- only services provided within the port area are covered by the directive;

- the application of social legislation is provided for (Article 15);

- the Member States will have to provide periodic reports to the Commission, which will use them to prepare a summary report and possibly proposals for revising the directive.

3. General comments

3.1. Seaports play a major role in the European Union's internal and external trade. The bulk of external trade and a significant proportion of internal trade pass through their infrastructure. It is therefore essential to integrate them fully in the multimodal transport network, since ports can contribute positively to the sustainable development of transport in Europe, particularly through the desirable development of maritime cabotage. The development of cabotage between Community ports would require in particular a significant easing of administrative formalities and constraints. Indeed, even more so than price, the bureaucratic procedures which have to be followed when calling in at a port constitute major obstacles to the development of short haul maritime transport.

3.2. The ports also participate in economic and social cohesion and in public transport service, connecting in particular with islands and peripheral areas; in environmental protection and in combating maritime disasters and pollution; they play a part in general regional development, both directly and through the services and industries which are established in and around ports (in some cases it is an industry which creates the port). This contribution to employment - through diversified, skilled jobs - and to social and territorial cohesion cannot be detached from their functions, as emphasised in the Committee's opinion on the Green Paper(2).

3.3. Seaports are also sensitive places where the external frontiers of the Union take tangible form and where sovereign activities must take place to ensure the security of the Union (inspections by the state of the port, customs checks and the fight against organised crime) and to implement other policies (taxation, immigration policy, etc.). These various functions, which by their nature are non-commercial, nonetheless have an important direct commercial impact, particularly in terms of the time they can involve during which a ship is immobilised at the quayside, or when the state delegates certain functions to the port authority without compensation.

3.4. All these functions are linked economically to the general operation of the ports. Their management and the safety and effectiveness of their operation call for an overall, integrated approach which ensures that the various tasks are performed by the relevant authorities and operators in the minimum of time and with the maximum of safety and efficiency; this would meet the demands of users and help to limit the costs involved in deep sea shipping calling at ports; this demand is particularly high for internal and European cabotage.

3.5. The Green Paper on Sea Ports and Maritime Infrastructure had been presented as a contribution to improving the effectiveness and quality of port services; however, the draft directive deals essentially with competition questions. While supporting, as it did at the time of the Green Paper(3), the principles of fair competition, transparency and freedom to provide services, the Committee also thinks that legislation must seek to strengthen the economic capacity of ports without increasing their administrative burdens.

3.6. The elimination of state aid or similar forms of aid is the Commission's central concern; the port sector is described as heavily dependent on state aid or on other public authorities, with a lack of transparency in its accounts to the extent that they do not clearly show these forms of aid.

3.7. The Committee is convinced that the "transparency" directive (Directive 2000/52/EC(4)), subject to an extension of its scope to cover all ports in the TEN, and the Treaty Articles relating to competition and to public aids and subsidies, as well as the relevant Court of Justice case law, would be enough to give the Commission considerable, sufficient and effective means of intervention on a case-by-case basis if violations of these rules were found in a given port, whatever its ownership arrangements. The very detailed analyses made by the Commission of every imaginable form of state aid in the general presentation of its draft confirm this. If there is a conflict of interpretation, it is for the Court of Justice in Luxembourg to decide, and it will be possible subsequently to base action on a body of case law which would provide a more consistent interpretation of the rules on state aids or competition, applying to all ports.

3.8. Ports are places of temporary storage, on public land managed by the port authority and on adjacent private land (unless the port itself is private), but above all of transit between different transport modes, and a more global approach to the services linked with transport would perhaps have been preferable to an approach which picks out ports carrying out a certain level of activities, but which are a link in a chain which should be considered as a whole. The Committee points out that the White Paper on transport deals with sea shipping and with the efficiency and development of ports; it will give its views in the near future on the Commission's proposed policy.

3.9. While normal, fair competition must in the Committee's view be guaranteed between ports, while respecting standards of safety for people and goods and the requirements of general interest and public obligations, any distortions of competition do not result solely - as the Commission appears to think - from aids or subsidies which are thought to be inappropriate. For example, access arrangements at the port, particularly by road, rail and river: distortions between ports can arise from significant distortions in the funding of these different modes of access.

3.10. Other major factors in distortion of competition are: the inspection of ships, depending on whether the Paris memorandum of understanding is respected or not (targeting coefficient for inspection of 25 % of ships entering the port), with consequences for maritime safety; different treatment depending on the port, sometimes involving the dropping of certain official customs or immigration checks and inspections, putting undue burdens on the port authority, with the risk of facilitating delinquent activities. These factors can constitute a serious threat to public order and certain common policies. The Commission should take them seriously, especially when the latter aspect is involved.

3.11. As regards competition, it should also be noted that in accordance with the proportionality principle it is the comparison of any restrictions practised in the Member States which would be likely to reveal any cases of discrimination. It is clear that the diversity of port situations makes such a comparison difficult. A text of general scope would therefore have limited significance in this respect.

3.12. Examination of the written and oral contributions received from operators and port users, particularly at the hearing held at the ESC on 18 July 2001 with a number of their representatives, has shown that the reservations expressed, with differences of emphasis, on various points of the Commission proposal, did not come only from piloting, towing and mooring associations, as the Commission claimed:

- The piloting, towing and mooring associations in fact expressed fairly strong opposition to the draft directive.

- The port organisations themselves, while confirming their attachment to the principles of competition and transparency enshrined in the Treaty establishing the European Community, express reservations concerning the form and the content, particularly with regard to the picking out of ports of a certain size in the transport chain as a whole, and the imposition of certain rigid rules, instead of allowing the relevant port authority greater scope for management according to the particular circumstances of the port concerned, subject to possible monitoring by the Commission and, if appropriate, the Court of Justice.

- The trade unions in the port handling sector take the view that the draft directive would impose an artificial system of competition which would not take account of existing collective and other agreements, and would cause serious social problems; in their view, handling should be excluded from the directive.

- The shipowners' and shippers' representatives, as customers of the ports, in principle support the Commission's proposals, which they expect will in particular reduce their port costs and increase efficiency.

3.13. The Committee agrees with the Commission's statement that competition and transparency have made considerable progress in recent years according to the diversity of situations - which should lead one to allow in all cases a decisive role for subsidiarity, subject to the monitoring mentioned above - and to revise accordingly the set of draft rules.

3.14. Finally, the Committee would point out that, in its opinion given when the Commission Green Paper on port services was published, it issued its views and recommendations favourable to the proposed approach; but it also stressed the need to take into account the social, employment and economic and social cohesion aspects, as well as the environment - which do not receive in this piece of draft legislation the attention which their importance merits.

3.15. One of the aims of the draft directive, namely to encourage the development of combined transport and thus reduce the burden on other transport infrastructure, is entirely desirable, but there is a need to streamline certain bureaucratic procedures specific to maritime transport as compared with the other modes of transport.

3.16. The directive should avoid creating new obligations for the responsible authorities of the ports concerned, which would run the risk of burdening and complicating their management; this would lead to a significant increase in their operating costs, particularly for the smaller ports.

3.17. In view of the aims to be achieved, it is essential to ensure that the provisions on handling do not cast doubt on collective and other agreements resulting from the social dialogue, which guarantee the continuity of service and the maintenance of social harmony(5).

4. Specific comments

4.1. Scope and definitions

4.1.1. The Committee notes that some of the Commission's definitions need to be clarified or reformulated: the terms "port user" and "port facilities" should be clarified, and the concept of "port system" is unsatisfactory and should be reformulated. The definition of a "sea port" should cover all ports to which ocean-going vessels have access. Finally, the Committee would prefer the text to be recast as part of a framework directive so as to give full scope to subsidiarity and local initiatives - essential for adapting the operation of ports both to the general needs of the TEN-T and to the specific needs of customers and areas.

4.1.2. Any draft legislation on ports must take due account of their role in sustainable transport, environmental protection, employment, economic and social cohesion and regional development. Questions also arise as to the thresholds for inclusion of ports in the scope of this legislation: these are based on tonnage or number of passengers, not on movements of ships - which is also a significant criterion - and do not take account of the varied nature of cargoes, requiring different treatment and investment, and different numbers of handling staff. As it stands, the proposal would in fact encourage large ports at the expense of small and medium-sized ports, when the latter are essential to decentralised intermodal transport and to providing a real alternative to certain modes of transport with a view to sustainable development in Europe.

4.1.3. In any case, and even though the traffic data change year by year, the list of ports concerned should be annexed to the directive; in addition, the Committee suggests that the thresholds envisaged for implementing the directive be raised, so that small and medium-sized ports do not have their costs and obligations substantially increased - something which would put them in an even more difficult situation vis-à-vis the large ports.

4.2. Accounting and state aid, monitoring

4.2.1. The Committee notes that the system of property ownership is respected (in accordance with Treaty Article 295). Like the port authorities, any service provider is obliged to submit annually to the awarding authority true, detailed accounts; these accounts should be subject to external audit, so that checks can be made on the way in which it meets its specifications and any public-interest service obligations it may have. The latter concept should not be defined too restrictively: essential services for any ship - all those with an impact on maritime safety, such as pilotage in certain ports, or on operational safety when handling dangerous cargoes - and defined as essential by the legislation of the state concerned - constitute public-interest services.

4.3. Procedures on tendering, transparency

4.3.1. The Directive lays down the principle that administrative decisions and procedural measures must be adopted by neutral bodies and not by authorities which are also the private providers' rivals. This is to be endorsed. However, the administrative outlay involved in such procedures should be kept as low as possible. Checks should therefore be carried out to ascertain whether the proposed transparency in the bookkeeping, in conjunction with the rules for awarding contracts by competitive tender and external checks, is not sufficient to ensure the requisite independence of the authority taking the decisions without new authorities having to be set up merely for this purpose.

4.3.2. In order to take account of port users' interests, it seems desirable to the ESC to encourage the setting up of a committee of port partners and players, to emphasise the existence of a port community which can guarantee transparency. Meeting regularly, and broadened to include the elected representatives of the municipalities where the port is situated, such a port community would provide real added value for users, managers, workers, enterprises, and local people in terms of economic efficiency, cohesion and transparency.

4.3.3. The relevant authority designated by the Member States would be obliged to provide adequate training for any operator (i.e. all its staff) when local knowledge is essential to any potential service provider: this constitutes a heavy burden for which the mode of funding is unclear. Local knowledge depends on the professionals working in the port itself, its access points and the port territory as a whole (public and private areas); it is difficult to imagine a firm or cooperative responsible for pilotage, inshore pilotage or towing being obliged to train potential competitors. The port managers themselves do not necessarily have the resources to provide such training; at most they could be obliged to provide information for potential candidates on the special local features of the port. Port familiarisation is very specific, and in some cases can involve several years of training and experience.

4.3.4. The concept of a reasonable time-limit within which the validity of authorisations granted under an earlier, different, system must be reviewed (unlimited - which means that in practice there will be a review in nearly all cases) is lacking in precision; the maximum time-limit of 25 years would not be appropriate when operators have made very substantial investments which can be legally written off over a longer period, which should then be taken into account.

4.4. Self-handling

4.4.1. Self-handling would pose the same problems of safety and skills as arise for the port handling staff. Equipment such as a crane requires highly skilled staff with lengthy training; it is not feasible to authorise the ship-owner or cargo owner to employ temporary external staff or the firm's own insufficiently skilled staff, because that would put pressure on wages and existing regular jobs in the port; this would involve higher risks of personal injury and of serious pollution or accidents, which could result from careless handling of certain types of cargo. The Member States and the port authorities must retain the right to set strict rules and criteria in this area in order to prevent any abuses and ensure the safety of people and goods, as well as the skills and working conditions of the handling staff which are essential to operational safety.

5. Conclusions

5.1. To sum up, the Committee notes with interest that the Commission proposal seeks to eliminate restrictions on access to the port services market and to make existing monopolies more competitive, but takes the view that the means proposed give rise to reservations; it also thinks that the proposal involves some pointless bureaucratic aspects, which could make management more cumbersome. Thus the obligation to have at least two handling firms operating in most ports should not be imposed mechanically. It fully supports extending the obligation of transparency and separate accounts to all ports in the Trans-European Network, but believes that this could be done by amending the aforementioned Transparency Directive.

5.2. Moreover, the distinction made between "unlimited" and "limited" ports seems theoretical: each port has to contend with specific constraints which require specific treatment. The case of private ports open to commercial traffic also raises special problems, particularly because of the nature and the scale of such an investment, necessarily a very long-term one in terms of returns.

5.3. It is essential to give more thought to ways of taking into account the interests of owners of goods, who are essentially those who make the real choice of maritime transport and between ports: this choice does not depend solely on internal competition measures in the ports, but on their organisation, their transport/storage logistics and the facilities and interfaces available to them for that purpose, and on other factors, such as the proximity of their customers, cost-effectiveness ratios, administrative constraints etc.

5.4. In the Committee's view, therefore, the proposal on port services ought to be placed by the Commission in the context of the debate on the Transport White Paper. Ports must be made part of a coherent overall approach, while taking full account of their specific features, and bearing in mind the important recent and current developments. Improving the competitiveness of European ports requires an approach which is broader than the current vision.

Brussels, 29 November 2001.

The President

of the Economic and Social Committee

Göke Frerichs

(1) OJ L 228, 9.9.1996, p. 1.

(2) OJ C 407, 28.12.1998, p. 92.

(3) OJ C 407, 28.12.1998, p. 92.

(4) OJ L 193, 29.7.2000, p. 75.

(5) In three judgments issued on 21 September 1999, the Court of Justice of the EC allowed that collective agreements could derogate from Community competition law, in Albany International BV, C67/96 Rec. I-5751, in Brentjens' Handelsonderneming BV, C117/97 Rec. I-6025, and in Maatschappig Drijvende BV, C212/97 Rec. I-6121, by virtue of their nature and their subject.

APPENDIX

To the opinion of the Economic and Social Committee

The following amendment, which received at least a quarter of the votes cast, was considered and rejected.

Point 4.4.1

Delete second sentence ("Equipment such as crane ... certain types of cargo").

Reason

This paragraph on self-handling is much too negative and is also in stark contrast to the position adopted by the ESC in its opinion on the Green Paper on sea ports: "As to cargo handling services, it is important that not only new 'traditional' operators but also shipowners, shippers/cargo owners and forwarders could enter the market (self-handling)." (point 4.2.3). At the 18 July hearing, ship-owner and shipper representatives stressed that self-handling was crucial.

Result of voting

For: 34, against: 43, abstentions: 5.