COUNCIL REGULATION (EEC) No 4057/86

of 22 December 1986

on unfair pricing practices in maritime transport

THE COUNCIL OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Economic Community, and in particular Article 84 (2) thereof,

Having regard to the draft Regulation submitted by the Commission,

Having regard to the opinion of the European Parliament (1),

Having regard to the opinion of the Economic and Social Committee (2),

Whereas there is reason to believe, inter alia on the basis of the information system set up by Council Decision 78/774/EEC (3), that the competitive participation of Community shipowners in international liner shipping is adversely affected by certain unfair practices of shipping lines of third countries;

Whereas the structure of the Community shipping industry is such as to make it appropriate that the provisions of this Regulation should also apply to nationals of Member States established outside the Community or cargo shipping companies established outside the Community and controlled by nationals of Member States, if their ships are registered in a Member State in accordance with its legislation;

Whereas such unfair practices consist of continuous charging of freight rates for the transport of selected commodities which are lower than the lowest freight rates charged for the same commodities by established and representative shipowners;

Whereas such pricing practices are made possible by non-commercial advantages granted by a State which is not a member of the Community;

Whereas the Community should be able to take redressive action against such pricing practices;

Whereas there are no internationally agreed rules as to what constitutes an unfair price in the maritime transport field;

Whereas, in order to determine the existence of unfair pricing practices, provision should therefore be made for an appropriate method of calculation; whereas when calculating the ‘normal freight rate’ account should be taken of the comparable rate actually charged by established and representative companies operating within or outside conferences or otherwise of a constructed rate based on the costs of comparable companies plus a reasonable margin of profit;

Whereas appropriate factors relevant for the determination of injury should be laid down;

Whereas it is necessary to lay down the procedures for those acting on behalf of the Community shipping industry who consider themselves injured or threatened by unfair pricing practices to lodge a complaint; whereas it seems appropriate to make it clear that in the case of withdrawal of a complaint, proceedings may, but need not necessarily, be terminated;

Whereas there should be cooperation between the Member -States and the Commission both as regards information about the existence of unfair pricing practices and injury resulting therefrom, and as regards the subsequent examination of the matter at Community level; whereas, to this end, consultations should take place within an Advisory Committee;

Whereas it is appropriate to lay down clearly the rules of procedure to be followed during the investigation, in particular the rights and obligations of the Community authorities and the parties involved, and the conditions under which interested parties may have access to information and may ask to be informed of the principal facts and considerations on the basis of which it is intended to propose the introduction of a redressive duty;

Whereas, in order to discourage unfair pricing practices, but without preventing, restricting or distorting price competition by non-conference lines, providing that they are working on a fair and commercial basis, it is appropriate to provide, in cases where the facts as finally established show that there is an unfair pricing practice and injury, for the possibility of imposing redressive duties on particular grounds;

Whereas it is essential, in order to ensure that redressive duties are levied in a correct and uniform manner, that common rules for the application of such duties be laid down; whereas, by reason of the nature of the said duties, such rules may differ from the rules for the levying of normal import duties;

Whereas open and fair procedures should be provided for the review of measures taken and for the investigation to be reopened when circumstances so require;

Whereas appropriate procedures should be established for examining applications for refund of redressive duties,

HAS ADOPTED THIS REGULATION:

Article 1

Objective

This Regulation lays down the procedure to be followed in order to respond to unfair pricing practices by certain third country shipowners engaged in international cargo liner shipping, which cause serious disruption of the freight pattern on a particular route to, from or within the Community and cause or threaten to cause major injury to Community shipowners operating on that route and to Community interests.

Article 2

In response to unfair pricing practices as described in Article 1 which cause major injury, a redressive duty may be applied by the Community.

A threat of major injury may only give rise to an examination within the meaning of Article 4.

Article 3

For the purposes of this Regulation:

Article 4

Examination of injury

1.   Examination of injury shall cover the following factors:

2.   Where a threat of injury is alleged, the Commission may also examine whether it is clearly foreseeable that a particular situation is likely to develop into actual injury. In this regard, account may also be taken of factors such as:

3.   Injury caused by other factors which, either individually or in combination, are also adversely affecting Community shipowners must not be attributed to the practices in question.

Article 5

Complaint

1.   Any natural or legal person, or any association not having legal personality, acting on behalf of the Community shipping industry who consider themselves injured or threatened by unfair pricing practices may lodge a written complaint.

2.   The complaint shall contain sufficient evidence of the existence of the unfair pricing practice and injury resulting therefrom.

3.   The complaint may be submitted to the Commission, or a Member State, which shall forward it to the Commission. The Commission shall send Member States a copy of any complaint it receives.

4.   The complaint may be withdrawn, in which case proceedings may be terminated unless such termination would not be in the interest of the Community.

5.   Where it becomes apparent after consultation that the complaint does not provide sufficient evidence to justify initiating an investigation, then the complainant shall be so informed.

6.   Where, in the absence of any complaint, a Member State is in possession of sufficient evidence both of unfair pricing practices and of injury resulting therefrom for Community shipowners, it shall immediately communicate such evidence to the Commission.

Article 6

Consultations

1.   Any consultations provided for in this Regulation shall take place within an Advisory Committee, which shall consist of representatives of each Member State, with a representative of the Commission as Chairman. Consultations shall be held immediately on request by a Member State or on the initiative of the Commission.

2.   The Committee shall meet when convened by its Chairman. He shall provide the Member States, as promptly as possible, with all relevant information.

3.   Where necessary, consultation may be in writing only; in such case the Commission shall notify the Member States and shall specify a period within which they shall be entitled to express their opinions or to request an oral consultation.

4.   Consultation shall in particular cover:

Article 7

Initiation and subsequent investigation

1.   Where, after consultation, it is apparent that there is sufficient evidence to justify initiating a proceeding the Commission shall immediately:

5.   The Commission may hear the interested parties. It shall so hear them if they have, within the periods prescribed in the notice published in the Official Journal of the European Communities, made a written request for a hearing showing that they are an interested party likely to be affected by the result of the proceeding and that there are particular reasons why they should be given a hearing.

6.   Furthermore, the Commission shall, on request, give the parties directly concerned an opportunity to meet, so that opposing views may be presented and any argument put forward by way of rebuttal. In providing this opportunity the Commission shall take account of the need to preserve confidentiality and of the convenience of the parties. There shall be no obligation on any party to attend a meeting and failure to do so shall not be prejudicial to that party's case.

8.   Proceedings on unfair pricing practices shall not constitute a bar to customs clearance of the goods to which the freight rates concerned apply.

Article 8

Confidentiality

1.   Information received in pursuance of this Regulation shall be used only for the purpose for which it was requested.

3.   Information will ordinarily be considered to be confidential if its disclosure is likely to have a significantly adverse effect upon the supplier or the source of such information.

4.   However, if it appears that a request for confidentiality is not warranted and if the supplier is either unwilling to make the information public or to authorize its disclosure in generalized or summary form, the information in question may be disregarded.

The information may also be disregarded where such request is warranted and where the supplier is unwilling to submit a non-confidential summary, provided that the information is susceptible of such summary.

5.   This Article shall not preclude the disclosure of general information by the Community authorities and in particular of the reasons on which decisions taken in pursuance of this Regulation are based, or disclosure of the evidence relied on by the Community authorities insofar as necessary to explain those reasons in court proceedings. Such disclosure must take into account the legitimate interest of the parties concerned that their business secrets should not be divulged.

Article 9

Termination of proceedings where protective measures are unnecessary

1.   If it becomes apparent after consultation that protective measures are unnecessary, then, where no objection is raised within the Advisory Committee referred to in Article 6 (1), the proceeding shall be terminated. In all other cases the Commission shall submit to the Council forthwith a report on the results of the consultation, together with a proposal that the proceeding be terminated. The proceeding shall stand terminated if, within one month, the Council, acting by a qualified majority, has not decided otherwise.

2.   The Commission shall inform the parties known to be concerned and shall announce the termination in the Official Journal of the European Communities setting forth its basic conclusions and a summary or the reasons therefor.

Article 10

Undertakings

1.   Where, during the course of investigation, undertakings are offered which the Commission, after consultation, considers acceptable, the investigation may be terminated without the imposition of redressive duties.

Save in exceptional circumstances, undertakings may not be offered later than the end of the period during which representations may be made under Article 7 (4) (c) (iii). The termination shall be decided in conformity with the procedure laid down in Article 9 (1) and information shall be given and notice published in accordance with Article 9 (2).

2.   The undertakings referred to under paragraph 1 are those under which rates are revised to an extent such that the Commission is satisfied that the unfair pricing practice, or the injurious effects thereof, are eliminated.

3.   Undertakings may be suggested by the Commission, but the fact that such undertakings are not offered or an invitation to do so is not accepted, shall not prejudice consideration of the case. However, the continuation of unfair pricing practices may be taken as evidence that a threat of injury is more likely to be realized.

4.   If the undertakings are accepted, the investigation of injury shall nevertheless be completed if the Commission, after consultation, so decides or if request is made by the Community shipowners concerned. In such a case, if the Commission, after consultation, makes a determination of no injury, the undertaking shall automatically lapse. However, where a determination of no threat of injury is due mainly to the existence of an undertaking, the Commission may require that the undertaking be maintained.

5.   The Commission may require any party from whom an undertaking has been accepted to provide periodically information relevant to the fulfilment of such undertakings, and to permit verification of pertinent data. Non-compliance with such requirements shall be construed as a violation of the undertaking.

Article 11

Redressive duties

Where investigation shows that there is an unfair pricing practice, that injury is caused by it and that the interests of the Community make Community intervention necessary, the Commission shall propose to the Council, after the consultations provided for in Article 6, that it introduce a redressive duty. The Council, acting by a qualified majority, shall take a Decision within two months.

Article 12

In deciding on the redressive duties, the Council shall also take due account of the external trade policy considerations as well as the port interests and the shipping policy considerations of the Member States concerned.

Article 13

General provisions on duties

1.   Redressive duties shall be imposed on the foreign shipowners concerned by regulation.

2.   Such regulation shall indicate in particular the amount and type of duty imposed, the commodity or commodities transported, the name and the country of origin of the foreign shipowner concerned and the reasons on which the Regulation is based.

3.   The amount of the duties shall not exceed the difference between the freight rate charged and the normal freight rate referred to in Article 3 (c). It shall be less if such lesser duty would be adequate to remove the injury.

5.   Duties shall be collected by Member States in the form, at the rate and according to the other criteria laid down when the duties were imposed, and independently of the customs duties, taxes and other charges normally imposed on imports of goods transported.

6.   Permission to load or discharge cargo in a Community port may be made conditional upon the provision of security for the amount of the duties.

Article 14

Review

1.   Regulations imposing redressive duties and decisions to accept undertakings shall be subject to review, in whole or in part, where warranted. Such review may be held either at the request of a Member State or on the initiative of the Commission. A review shall also be held where an interested party so requests and submits evidence of changed circumstances sufficient to justify the need for such review, provided that at least one year has elapsed since the conclusion of the investigation. Such requests shall be adressed to the Commission, which shall inform the Member States.

2.   Where, after consultation, it becomes apparent that review is warranted, the investigation shall be re-opened in accordance with Article 7, where the circumstances so require. Such reopening shall not per se affect the measures in operation.

3.   Where warranted by the review, carried out either with or without reopening of the investigation, the measures shall be amended, repealed or annulled by the Community institution competent for their adoption.

Article 15

1.   Subject to paragraph 2, redressive duties and undertakings shall lapse after five years from the date on which they entered into force or were last amended or confirmed.

2.   The Commission shall normally, after consultation and within six months prior to the expiry of the five year period, publish in the Official journal of the European Communities a notice of the impending expiry of the measure in question and inform Community shipowners known to be concerned. This notice shall state the period within which interested parties may make known their views in writing and may apply to be given a hearing by the Commission in accordance with Article 7 (5).

Where an interested party shows that the expiry of the measure would again lead to injury or threat of injury, the Commission shall carry out a review of the measure. The measure shall remain in force pending the outcome of this review.

Where redressive duties and undertakings lapse under this Article the Commission shall publish a notice to that effect in the Official Journal of the European Communities.

Article 16

Refund

1.   Where the shipowner concerned can show that the duty collected exceeds the difference between the freight rate charged and the normal freight rate referred to in Article 3 (c) the excess amount shall be reimbursed.

2.   In order to request the reimbursement referred to in paragraph 1, the foreign shipowner may submit an application to the Commission. The application shall be submitted via the Member State within the territory of which the commodities transported were loaded or discharged and within three months of the date on which the amount of the redressive duties to be levied was duly determined by the competent authorities.

The Member State shall forward the application to the Commission as soon as possible, either with or without an opinion as to its merits.

The Commission shall inform the other Member States forthwith and give its opinion on the matter. If the Member States agree with the opinion given by the Commission or do not object to it within one month of being informed, the Commission may decide in accordance with the said opinion. In all other cases, the Commission shall, after consultation, decide whether and to what extent the application should be granted.

Article 1 7

Final provisions

This Regulation shall not preclude the application of any special rules laid down in agreements concluded between the Community and third countries.

Article 18

Entry into force

This Regulation shall enter into force on 1 July 1987.

(1)  OJ No C 255, 15. 10. 1986, p. 169.

(2)  OJ No C 344, 31. 12. 1985, p. 31.

(3)  OJ No L 258, 21. 9. 1978, p. 35.