2011-12-21, 10:21
The question on a possible cart in the port still unanswered
© Vidmantas Matutis photo
Unprecedented situation, when due to the price cartel, 12 million LTL of fines were given to 32 port companies is still raising passions in the Port of Klaipeda. Fines are 10-12, sometimes 20 times higher than actual annual profits of shipping agent companies.
Some got fined, others not
Competition Council’s report states that from 1998 to 2011, the Lithuanian Shipbrokers and Agents Association and its members were in agreement to apply minimum standards for ship agencies’ service fees and were overseeing how other companies are complying with them. This is how ship agency companies escaped the need to compete on prices and prevented ship owners to benefit from competition advantages. Provided that the violation was serious and inflected for thirteen years, heavy fines were allocated. For cartel agreement, Competition Council has allocated such fines in LTL for these companies: Afalita (42,4 thousand), Amber Bay (510,5 thousand), Arijus (1,223 million), Astramara (50,5 thousand), Baltic Forwarding and Shipping (450,4 thousand), Baltic Transferring (1,861 million), Baltlanta (1,389 million), Baltnautic Shipping Ltd (235 thousand), BPA (321,7 thousand), Fertimara (138,4 thousand), Fregata Servicing Agency (69,6 thousand), Green Terminal (189,6 thousand), Joint Expedition (171,6 thousand), Jurtransa (27,5 thousand), Sea Agency Forsa (321,6 thousand), Bega (1,184 million), Klaipeda Translit (150,9 thousand), Lepunas (241,9 thousand), Limarko and Limarko Sea Agency (626,3 thousand), Litma (518,6 thousand), MK Shipping (420 thousand), Nordis Shipping Service (21,6 thousand), Nurminem Maritime (108,2 thousand), Oceanic Container Service (347,3 thousand), Passat (151,2 thousand), Commercial House Skelme (127,1 thousand), Unitek (8,2 thousand), Western Ships’ Agents (211,5 thousand), Port’s Gate (73,1 thousand), VPA Logistics (337,7 thousand), Volfra-Klaipeda (44,9 thousand), WM H. Muller & Co (106,5 thousand), and Lithuanian Shipbrokers and Agents Association (800 hundred).
As regards other seven companies, among which are large foreign companies’ subsidiaries in Lithuania, their cases on the same infringement were discontinued. This surprised the fined companies because the latter companies operated on similar terms and circumstances.
“Just imagine what could mean fining such companies as DFDS Seaways or MSC? Foreign companies would instantly file claims for their reputation disruption,” – claimed President of Lithuanian Shipbrokers Association Vytautas Sileika.
Set up limitations
Lithuanian Shipbrokers and Agents Association and individual companies will file claims against the conclusions reached by the Competition Council. Also, they will file claims on the allocated fines. The companies have already hired lawyers and are preparing for the court proceedings. One of the lawyers of Lawin, the law firm hired to defend companies; Karolis Kacerauskas claimed that until 1998, the minimum fees for ship agents were set up by the Ministry of Transport. Upon the cancellation of these minimum fees, other minimum fees were set up by the Association. According to Mr. Kacerauskas, until 2006 Lithuanian Shipbrokers and Agents Union tried to require compliance with the minimum service rates. First, it was a fight against ship agent’s price dumping. Second, ship owners asked to provide indicative prices of shipping agents in the port of Klaipeda.
“Upon sailing to ports, ship owners want to know approximate prices. European Union has some countries, where ship agents’ fees are declared publicly just as other port’s fees. This is understood as a part of business,” – noted Manager of MK Shipping Mindaugas Karalius.
What has changed since 2006? According to Mr. Kacerauskas until 2006, ship agents’ activities have been attested. In order to receive a certificate, one needed a recommendation from the Lithuanian Shipbrokers and Agents Association. When this provision had been eliminated, the impact of Association for the agencies disappeared. After 2006, conditions for ship agencies have changed significantly. Ship agency prices began to decline. As Mr. Sileika points out, a lot of companies started administering ships in 3-4 times lower prices than recommended. Its relevance has disappeared. It is believed that in 2006 the importance of the agreement of 1998 disappeared.
“The limitation to examine competition violations is three years. This means that even in the case of violation in breaching competition laws has been made, the deadline to hear it ended in 2009,” – claimed Mr. Kacerauskas.
