MARITIME ALLIANCES AND EU COMPETITION LAW

101 DOMINANT POSITION AND ABUSE INDICATORS IN LINER SHIPPING Nonetheless, one must recall that the revenues of independent carriers always exceed those of the conference carriers due to the flexibility of their operations. Therefore, it is possible that the following situation arises: – A carrier currently operating outside the said geographic market would like to enter the market as an independent; – If it can afford to cover its low operational cost, it will negotiate for a lower price, deducting revenues from the consortium below their operating cost; the consortium would have to exit the market; – This may cause the voluntary exit of one or some of the incumbents; – Once a new entrant is established, the competing independent carrier could find it profitable to join the consortium, since a gap would have been cre- ated by the withdrawal of a conference member; – This would consequently reduce the number of independents by one and the profit of all carriers would once again increase. The above hypothesis was first raised as a possibility by Blanco (2007). 109 Although Blanco (examining the matter of block exemption in liner conferences) considers it very unlikely that free competition will encourage single undertaking monopo- lies, he acknowledged that an immediate prohibition of conferences may ultimate- ly have no practical effect if the oligopolies are not tackled head on by competent authorities. 110 In this context, Blanco has been correct, as we have empirically ob- served that there has been no considerable benefit for the consumer. Conversely, Bredima (2010), 111 in her plea for global governance on competition rules – appropriate to a global industry – disagrees (with emphasis) with the view of those who believed that the abolition of protective regimes will be beneficial for the industry as well as the consumer. She supported that any effort of unilateral deregulation in the EU, without consultation with the rest of the world, might not have brought about the intended (competitive) effects; she held that the aboli- tion of conferences might certainly lead to an oligopoly in the market in lieu of sui generis and existing competition. In this context, Bredima has been partially correct. We also take into account the opinion of Allsop (2009) 112 that denotes the 109. Blanco op. cit. n. 14 pp. 552, 582-589. 110. ibid. 589. 111. Anna Bredima, “Shoot first, ask questions later: International implications resulting from the unilateral abolitions of liner conferences in the EU” in Philip Wareham (ed.), Competi- tion Law and Shipping: The EMLO Guide to EU Competition Law in the Shipping and Port Industries [London, Cameron May 2010] 62-65. 112. James Allsop, “Maritime Law - The Nature and Importance of Its International Charac- ter” [2009-2010] 34 Tulane Maritime Law Journal 586, where he supports that: “…it was