Commission notice

pursuant to Article 23(3) of Council Regulation (EEC) No 4056/86 and Article 19(3) of Council Regulation 17 concerning Case COMP/37.396 - Revised Transatlantic Conference Agreement

(2001/C 335/03)

(Text with EEA relevance)

1. On 29 January 1999, the parties to the Transatlantic Conference Agreement ("TACA")(1) submitted to the Commission pursuant to Article 12(1) of Regulation (EEC) No 4056/86 and Article 12(1) of Regulation (EEC) No 1017/68 an application for exemption under Article 81(3) and Article 5 of Regulation (EEC) No 1017/68 in respect of a revised version of the Transatlantic Conference Agreement for which an application for individual exemption was originally made to the European Commission on 5 July 1994 and in relation to which the Commission issued a Decision on 16 September 1998 (the "TACA Decision")(2). The revised agreement is referred to as the "revised TACA".

2. On 6 May 1999, pursuant to Article 12(2) of Regulation (EEC) No 4056/86 and to Article 12(2) of Regulation (EEC) No 1017/68, the Commission published a summary of the application in the Official Journal of the European Communities, inviting interested parties to comment within 30 days from the date of publication(3).

3. On 4 August 1999, before the expiry of the 90-day deadline provided for in Article 12(3) of Regulation (EEC) No 4056/86, the Commission informed the parties that there existed serious doubts within the meaning of that article as to the applicability of Article 81(3) to the notified agreement. As the Commission did not raise serious doubts with regard to those aspects of the notified agreement that fell within the scope of Regulation (EEC) No 1017/68, those aspects were consequently deemed exempt until 5 May 2002(4).

4. The Commission intends to take a decision finding that the remaining aspects of the notified agreement that may infringe Article 81(1) either fall within the scope of the block exemption for liner shipping conferences provided for in Regulation (EEC) No 4056/86 or qualify for exemption under Article 81(3).

5. In its letter of serious doubts, the Commission stated its concern that certain provisions of the notified agreement would allow the members of the TACA to exchange information relating to individual service contracting activity in a manner restrictive of competition.

6. In response to the Commission's concerns, the members of the TACA have made changes and given undertakings. These changes and undertakings include awarding the task of collecting and aggregating confidential individual contract data to an independent third party and ensuring that, with certain limited exceptions, no carrier-specific information not in the public domain is either gathered by, or distributed to, the TACA secretariat or the parties. The Commission is satisfied that these changes and undertakings are sufficient to address the concerns which led it to raise serious doubts.

7. Following discussions with the Commission, the parties have further amended the provision in the revised TACA agreement that gives the parties a general authority to regulate the carrying capacity offered by each member. The amendments include an undertaking not to increase any tariff rate in conjunction with any capacity regulation programme or to create an artificial peak season. The parties will also provide the Commission with reports before, during and after the implementation of any such capacity regulation programme covering, inter alia, projected and actual cargo liftings, available capacity and unused slots. It is understood that any TACA capacity programme would follow the guidelines set out in previous Commission decisions, according to which a coordinated capacity withdrawal is permissible in a situation where such withdrawal is necessary in order to cope with a short-term fluctuation of demand and is compatible with the provisions of Article 81(3) of the EC Treaty.

8. The Commission considers that any remaining provision of the revised TACA that may be restrictive of competition and may fall outside the scope of Regulation (EEC) No 4056/86 satisfies the conditions for individual exemption set out in Article 81(3).

9. The Commission also notes that the parties to the TACA are subject to considerable internal and external competition. The introduction of confidential individual service contracts, made possible by the US Ocean Shipping Reform Act of 1998, has dramatically increased competition between the members of the TACA and has reduced the proportion of cargo carried under the conference tariff. External competitive pressures have also increased, as is evidenced by the decline in the market share of the TACA parties from above 60 % in 1995 to approximately 50 % today. The Commission concludes that subject to the parties' compliance with the above undertakings, there is no risk that the notified agreement will lead to the elimination of effective competition on the relevant market.

10. In accordance with Article 23(3) of Regulation (EEC) No 4056/86 and Article 19(3) of Regulation No 17, before the Commission adopts a decision it invites interested parties to submit their comments within 30 days from the date of publication of this notice, quoting reference "Case COMP/37.396 - revised TACA", to: European Commission Directorate-General for Competition

Unit COMP/D2

Rue de la Loi/Wetstraat 200 B - 1049 Brussels Fax (32-2) 296 98 12.

(1) Atlantic Container Line AB, Hapag-Lloyd Container Linie GmbH, Mediterranean Shipping Company SA, A. P. Moller - Maersk Sealand, Nippon Yusen Kaisha, Orient Overseas Container Line (UK) Ltd, P & O Nedlloyd Container Line Limited.

(2) Commission Decision of 16 September 1999 (OJ L 95, 9.4.1999, p. 1).

(3) OJ C 125, 6.5.1999, p. 6.

(4) See press release IP/99/620, 5.8.1999.