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ACCC Investigates Container Shipping Anti-Competitive Practices

ACA International is a member Freight & Trade Alliance(FTA) who are a representative body for the international supply chain sector bringing together importers, exporters, customs brokers, freight forwarders, logistics service providers and industry groups.  In partnership with the Australian Peak Shippers Association (APSA) the FTA

The Australian Competition & Consumer Commission (ACCC) recently confirmed two parallel investigations into alleged price gouging by shipping lines and port operators as importers and exporters strain under high container prices and ongoing port congestion.

  • The ACCC is investigating if there has been a breach of competition laws in relation to the shipping containers to or from Australia.
  • At the same time, wider issue of shipping and freight costs would be looked at in more detail in the ACCC's annual stevedoring monitoring report, which will be released in November.

COVID-19 disruptions and massive consumer demand for retail goods have strained the global shipping industry.

FTA has contacted the ACCC to try to get understanding of the scope of the investigation and to raise further points of concern.

Below is a summary of the main discussion points between the FTA/APSA and the ACCC:

Investigation terms of reference
 
The ACCC confirmed it is investigating a potential breach of the Competition and Consumer Act in relation to whether anti-competitive conduct has led to price increases in the container shipping industry.  Limited information could be provided as the ACCC does not generally comment on matters under investigation, however the following details were obtained:

  • the investigation is NOT a broad ranging enquiry into increasing pricing in the sector and is separate to the review being examined by the Federal Trade Minister – refer HERE;
  • the investigation is narrow in scope and has been commissioned in direct response to a specific allegation of anti-competitive practices; and
  • no detail was provided in terms of the commencement or projected end date of the investigation. 

Independent Decision Making
 
Reference was made to circumstances whereby shipping lines implement new surcharges and spot rates in quick succession of each other:

  • the ACCC is aware of these concerns and is keeping close watch.

Exclusive dealings
 
Reference was made to scenarios whereby shipping lines are offering capacity and / or significantly discounted rates contingent on using their other ‘vertically integrated’ services such as landside transport and customs clearances:

  • examples were sought to make an assessment whether practices are ‘substantially lessening competition'

Other matters
 
FTA/APSA shared views on:

  • stevedore and empty container park administered Terminal Access Charges;
  • the need for reform around shipping competition protections; and
  • landside logistics practices dominated by infrastructure owners without engagement and assessment of impacts on shippers. 

How to assist the ACCC
 
The ACCC is very interested in receiving feedback on suspicious behaviour that may indicate anti-competitive behaviour. Reports can be provided to the ACCC, including anonymously if preferred, via https://www.accc.gov.au/contact-us/contact-the-accc

It is hard to know if the ACCC will have any impact but they along with other commissions and government bodies around the world are receiving the same complaints from importers and exporter in relationship to ongoing and severe increase in costs.  Hopefully they can collectively use their leverage to influence some change

We will continue to update you on any news out of the investigations.