Thursday, June 27, 2013

Restriction of Freight Trade Accusation as EU Refers Spain to Court over Port Cargo Handlers

Spanish Face the Inquisition for Infringing Treaty's Labour Competition Regulations
Shipping News Feature

SPAIN – EUROPE - As the financial noose tightens across the continent so we are seeing more cases of state intervention and assistance coupled with restrictive practices in terms of trade and employment. So far this week we have reported on the EU Commission’s concern over the involvement of French and British governments in tariffs for rail traffic through the Channel Tunnel and their enquiries to the German authorities regarding cross subsidisation of transport. Now it is the turn of the Spanish to face the inquisition over the curious arrangement in which certain of the countries ports are not free to choose the teams of freight handlers working within them.

Last Thursday the European Commission referred Spain to the EU Court of Justice over the matter in which cargo-handling companies in some of the major ports, including Barcelona, Algeciras, Valencia and Bilbao, are not allowed to resort to the market to employ their staff. On the contrary, the rules in place oblige cargo-handling companies to participate financially in the capital of private companies, which in turn provide them with the required workforce.

Before the consolidators are permitted to employ outside labour they must prove that the workforce proposed by these private companies is not suitable or not sufficient for their needs. The EU Commission takes a dim view of what is plainly a restrictive practice and says this process discourages cargo handling companies from other Member States competing in the market.

Spanish law provides that private companies called SAGEPs (Sociedad Anónima de Gestión de Estibadores Portuarios) should be set up in ports of general interest. SAGEPs are in charge of recruiting dockers and putting them at the disposal of cargo-handlers. The same law obliges all companies wishing to provide cargo-handling services to join and financially participate in the capital of a SAGEP and only extreme cases can be individually excluded from the scheme.

Even if the port can evidence that the workforce supplied by the SAGEP is incompetent or insufficient they may only employ substitute labour for one working shift! The Commission has decided that this situation causes a forced alteration of the companies' existing employment structures, recruitment policies and ultimately business strategies, and such changes may entail serious disruption within companies and have significant financial consequences for them.

There is no suggestion that the policy is racist but it is plainly a restrictive agreement and infringes the terms of the EU Treaty which precludes any national measure which, even though not discriminatory on grounds of nationality, hinders or renders less attractive establishment of competition from elsewhere within the community.

Photo: Nobody expects……………….