MTS Address Allegedly Exclusionary Conduct in Cork Harbour
December 1, 2011
Outcome of investigation
The Competition Authority (“the Authority”) became aware of allegations that Marine Transport Services (“MTS”) was charging a higher price for mooring services to ship owners that did not use its sister company as ship agent. The file was closed in December 2011 when the Authority concluded an “Agreement and Undertakings” with MTS.
Outline of case
Ship agents are appointed by ship owners or charterers to represent them in the port and source port services such as mooring, towage and stevedoring. All ships require mooring services. Mooring services consist of the assistance of linesmen from the shore (shore-side mooring) and, in some cases, the assistance of launches to pass ropes to the linesmen on the shore (sea-side mooring).
The Authority’s concerns arose from its investigation of allegations that MTS was charging a higher price for sea-side mooring services to ship owners that used independent ship agents for the provision of sea-side mooring services in Cork Harbour than it did to ship owners that used its sister company, James Scott, as ship agent. MTS at the time was the only provider of sea-side mooring services in Cork Harbour.
Due to the possible exclusionary effect that this practice may have had on the market for ship agency services in Cork Harbour, the Authority believed that MTS’s pricing practice for sea-side mooring services could be in breach of competition law. These concerns were communicated to MTS. MTS offered undertakings to address these concerns and in December 2011, the Authority concluded an “Agreement and Undertakings” with MTS.
The Agreement and Undertakings received from MTS mean that ship owners or charterers availing of sea-side mooring services from MTS within the Port of Cork will be treated the same by MTS, whether they use James Scott or any other competing ship agent, except in circumstances which are objectively justified. In other words, the Agreement and Undertakings provide that any terms offered by MTS will be independent of the ship agent chosen.
This agreement resolved concerns that the Authority had regarding MTS’s price scheme for sea-side mooring services.
Relevant provision
Section 5 of the Competition Act 2002
Article 102 of the Treaty on the Functioning of the European Union
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