European Court of Justice Judgment on minimum operating costs in road carriage

In January 2013, the Regional Administrative Tribunal of Lazio requested the European Court of Justice to rule on the compatibility of the Italian legislation regarding “minimum costs” in road transport with EU competition law.
The Court rendered its judgment on 4th September 2014, declaring the illegitimacy of such legislation on two grounds.
Firstly, the composition of the “Osservatorio dell’Autotrasporto” (the organization determining the minimum costs) is more similar to a trade association and therefore does not ensure the compulsory impartiality and protection of the public interest.
Secondly, the compulsoriness of a minimum pay represents a limitation of the competition not justified by road safety protection reasons, not being suitable to serve such purpose.

Sulphur content in marine fuels

By judgment issued on 23rd January 2014 on the request for a preliminary ruling from the Tribunal of Genoa in a dispute related to the maximum sulphur content in marine fuels, the European Court of Justice held that a cruise ship, flying the flag of a State party to the Annex VI of Marpol, falls within the scope of Article 4a(4) of Directive 1999/32 (providing the use of marine fuels with a maximum sulphur content of 1,5%) with regard to the criterion of ‘regular services’, as laid down in Article 2(3g) ,thereof, provided that it operates cruises, with or without intermediate calls, finishing in the port of departure or another port, provided that those cruises are organized at a particular frequency, on specific dates and, in principle, at specified departure and arrival times, with interested persons being able to choose freely between the various cruises offered.

Maersk and MSC give rise to ‘2M’ alliance

After a few weeks from Mofcom’s decision to prohibit the P3 alliance, Maersk Line and MSC Mediterranean Shipping Company announced the new 2M alliance, a ten-year Vessel Sharing Agreement (VSA) on the Trans-Atlantic, Trans-Pacific and Asia-Europe trade routes.
The VSA, which is expected to start in early 2015, will involve about 185 vessels operating 21 liner services, with around 2.1 million TEUs total capacity.
In addition to having a smaller market share than P3 (deriving from Cma Cgm’s exclusion from the new deal), 2M would be a simpler cooperation by means of Vessel Sharing, without any separate independent organisation with executive powers to manage the network.

Mofcom prohibits P3 Alliance

On 17 June 2014 the Chinese competition authority, Mofcom, published its decision to prohibit the container shipping carriers alliance between Maersk Line, MSC Mediterranean Shipping and CMA CGM (‘P3’). It is important to note that Mofcom’s decision is not subject to any judicial review. The alliance would have involved a long term vessel sharing agreement for a minimum of ten years to create a joint fleet of 255 ships, with the aim of providing a more efficient service. According to Mofcom the agreement would result in a de facto merger and seriously affect Chinese domestic market by weakening the bargaining position of Chinese exporters and reducing the competitive strength of Chinese ports which would probably be forced to reduce their service charges; the size of the shipping companies involved also probably played a role in the decision. Mofcom’s decision came as a surprise, in view of the fact that the alliance had already received approval (although qualified) by the EU and US competition authorities. The decision has also caused concern in the industry about the lack of certainty arising from differing national competition rules.
[In cooperation with Helen Elmer, trainee, London]

Maritime transport

By a judgment issued on 27th March 2014 the European Court of Justice held that a maritime transport service consisting of a cruise which starts and ends, with the same passengers, in the same port of the Member State falls within the definition of ‘maritime cabotage’ under the Council Regulation (EEC) No 3577/92 of 7 December 1992, with reservation of the cabotage services ‘to Community shipowners who have their ships registered in, and flying the flag of, a Member State of the European Union’.

EU law principles

By judgment dated 25.02.2014, the European Court of Justice confirmed the right of every person to be heard before a detrimental measure is issued against them. The compulsory and preliminary right of controverting, set forth by Case Sopropé, has been recognized as an EU law principle and therefore its application can be directly invoked by the taxpayer to the national judges.
The right of controverting is not only about the right to state the taxpayer’s point of view about the sanctions issued by the authority, but it also refers to the right be heard and to raise objections before the final decision is adopted (C-29/13 and 30/13, Global Trans Lodzhistik OOD vs Nachalnik na Mitnitsa Stolichna).

Ship recycling

On 10th December 2013 the Regulation UE no. 1257/2013 on ship recycling was published on the Official Journal of the European Union.

The purpose of the Regulation is to enhance safety, protection of human health and of the Union’s marine environment through an environmentally sound management of hazardous or toxic waste originated by the ship recycling process.

Jurisdiction on international sale of goods

By a judgment issued on 16 January 2014, the Tribunal of Mantova declared the lack of jurisdiction of the Italian Courts holding that in the absence of an agreement between the parties (necessary requirement according to EC Regulation 44/2001), the place of delivery of the goods must be intended as the place where the goods are in fact to be delivered to the buyer, notwithstanding the “CPT (Carriage Paid To)” clause.

Piracy at Sea

On 19th October 2013 the General Director of Police issued a circular to implement the provisions of the Ministerial Decree No 266 dated 28.12.2012 (published on the Official Gazette No 75 dated 29.3.2013), concerning the use of private security guards onboard Italian merchant ships which sail in international waters at risk of piracy. This is Italy’s latest step to fight piracy at sea. Further information can be found in articles written by