On Oct. 18, 2008, five years after the establishment of the ELAA as the liner shipping industry’s lobby organization in Brussels, the liner shipping conference system came to an end on trades to and from Europe. The abolition of conferences comes at a difficult time for the industry: We must cope with the massive financial and economic conditions following the subprime crisis in the U.S. The impact has been that the industry having been used to double-digit growth will see negative growth on major trades in 2009. As a result, freight rates are falling and the outlook for profitability is weak.
On Oct. 20, the ELAA established a subsidiary company based in London and Singapore to run the Information Exchange System between lines. The ELAA system was vetted by two of the top competition law firms in the EU the top priority of the ELAA and its members is that the system be run in accordance with the EU competition rules, as set out in the maritime guidelines.
The challenge for us in 2009 will be to have the output up and running for our member lines, shippers and the general public.
The other major challenge for our industry in 2009 will be the review of the consortia block exemption which was announced within 10 days of the end of the conference system. The ELAA has been mandated by its members to represent the industry in this review, which in many ways will be more important than the conference review because it governs the way lines operate on a day-to-day basis.