Shippers' group targets global maritime reform

By Staff -- Logistics Management, 10/1/2000

T he movement to increase ocean shipping industry competition has gone global. With the successful passage of the Ocean Shipping Reform Act (OSRA) in the United States behind them, shippers are pressing their cause worldwide.

At the seventh annual meeting of the Tripartite Shippers Group, held in September in Haifa, Israel, representatives from member organizations voted to submit a petition regarding maritime regulatory reform to the Organization for Economic Cooperation and Development (OECD). The Tripartite Shippers Group includes the three original members-the National Industrial Transportation League (NITL), the European Shippers' Council, and the Japan Shippers' Council-and shippers' councils from Canada, Hong Kong, Korea, Singapore, Thailand, and the ASEAN (Association of Southeast Asian Nations) countries.

OECD has been conducting studies on regulatory reform in several business sectors, including the maritime industry. Earlier this year, the Tripartite Shippers Group sent a delegation to OECD's regulatory reform workshop in Paris, where the group requested that the OECD review regulations affecting competition in the maritime industry and pledged its support for such a review. Specifically, the group's members would like the OECD to examine seven aspects of ocean shipping. They include: immunity and pricing, entry and exit from trade routes, carriers' financial positions, industry cost structures and cost trends, market concentration, activities of ocean carrier discussion and stabilization agreements, and the role of technology in reducing costs and increasing flexibility. This kind of sweeping investigation is warranted, shippers believe. "[N]ew and different ways of approaching today's ocean transportation business are the only way to develop innovations and efficiencies in an industry [that] for too long has been rooted in the past," read a statement issued by the Hong Kong Shippers' Council.

Members also agreed to continue to work in their home regions to promote greater competition in the maritime sector. In that vein, they affirmed support for pending legislation in Canada that would strip ocean carriers' groups of their exemption from antitrust laws.

Another important issue the group addressed was reform of maritime cargo-liability regimes. Members agreed that laws governing ocean cargo liability in most countries were greatly outdated and that they would encourage their national governments to implement changes that would, at the least:

• Define a package as "the individual units packed in a container or on a pallet," and not the container or pallet itself;

• Increase per-package limits to a level that realistically reflects the value of a lost or damaged shipment; and

• Eliminate the ancient "error of navigation" defense that allows carriers to avoid liability for cargo loss or damage that results from negligent navigation or management of a vessel.

Members also agreed to continue to develop the Global Shippers Network information source (www.globalshippersnetwork.net) by adding links to government and industry Web sites, creating opportunities for transportation policy makers to post information, and facilitating educational opportunities for shippers and other transportation professionals.

NITL President Gerry Mayer praised the meeting as being "very productive" and "an important planning session for all participants." He also noted the uniformity of shippers' needs, saying, "It is obvious that shippers from all parts of the world have similar concerns."