RAY SMUTS TODAY (July 29) is D-day for the European Competition Commission ruling on the proposed takeover of P&O Nedlloyd by the AP Moller-Maersk Group, a decision that could have a far-reaching effect on future containerised maritime traffic between South Africa and UK/Northwest continent. If AP Moller-Maersk were to retain the PONL share of the SA-Europe Container Service (SAECS) – a partnership of Maersk Sealand, Safmarine, P&O Nedlloyd and Deutsche Afrika-Linien (DAL) – it would have a believed-to-be reliable ‘guesstimated’ 63% of the two-way container trade between South Africa and the UK/Northwest continent, according to an industry source. They would also have 1100 out of the 1 420 weekly northbound slots (which include MSC/MACS and the Seatrade/Laucool joint venture), giving them 77.5% of the northbound reeferbox capacity, he said. This was the motivation for the recent European Competition Commission-bound delegation that included Wayne Mudge, director of the Fresh Produce Exporters Forum, Dr Malcolm Dodd of the Perishable Products Export Control Board, Graham Retief, chairman of the SA Table Grape Industry, and George Hall, director of the Citrus Growers Association of Southern Africa, Colin Schultz of the Western Cape Cargo Owners Association and Russell Tickner of the SA Fruit and Vegetable Canners Association. It was made quite clear to the European Competition Commission that it was not our (South African) prerogative to prescribe to them on the global aspect. But in the event of its authorising the APMM take-over bid, the delegation requested it should be conditional upon APMM simultaneously divesting itself of the PONL share of the SA-UK/NWC trade lane (hardware and all) to an unrelated third party and guaranteeing membership of the SAECS consortium for a minimum of five years. This to enable the incoming participant to settle down in an orderly and non-disruptive manner. Basically APMM has agreed to this among a number of “remedies” submitted to the ECC on July 7. Reverting to the crux of the matter, the industry questions whether it is desirable for a single entity to control 63% of the round-trip containerised traffic and 77.5% of northbound reefer box traffic. Whether cargo can otherwise move by tanker, taxi cab, submarine, sailing ship or conventional reefer/underdeck is irrelevant – the issue is purely about containerised traffic. More recently, CMA CGM and Deutsche Afrika-Linien have emerged as possible frontrunners to buy PONL’s stake in SAECS in terms of the settlement proposed by the AP Moller-Maersk group to the ECC, to address concerns about dominance in the overall container trade. In the case of DAL, in order to qualify as an unrelated third party, this would require immediate termination of the “SAFDAL Alliance” which predates the 1999 acquisition of Safmarine Container Lines by APMM. Alarm bells started ringing in recent weeks with the news that the Danish APMoller-Maersk Group, owner of sister companies Maersk Sealand and Safmarine, was seeking to acquire P&O Nedlloyd (which holds a 30% capacity stake in SAECS), subject to ECC approval ; something that did not go down well with some SA importers and exporters.
