Reed Smith associates Emma Weeden and Charles Sauvage explore the impact of the Consortia Block Exemption Regulation's (CBER) expiry on the liner shipping industry and evaluate the potential of the Specialization Block Exemption Regulation (SBER) as a replacement. They also discuss the resulting changes, including legal adjustments, compliance considerations and the future landscape for competition, innovation and sustainability. ----more---- Transcript: Intro: Trading Straits brings legal and business insights at the intersection of the shipping and energy sectors. This podcast series offers trends, developments, challenges and topics of interest from Reed Smith litigation, regulatory and finance lawyers across our network of global offices. If you have any questions about the topics discussed on this podcast, please do contact our speakers.  Emma: Welcome to the Trading Straits podcast. Today, me Emma Weeden and my colleague Charles Sauvage from Reed Smith's London and Brussels office will be talking to you about the consortia block exemption regulation. So the Consortia Block Exemption Regulation actually expired in April and it applied to container shipping lines to allow them to collaborate on space and their sailings. Today we're going to be talking about the implications of that law expiring and how shipping consortia will work going forward. So to start off with, we should talk a little bit about what shipping consortia are. These are shipping lines that jointly cooperate in the provision of container services. These cooperations are in respect of sharing space on vessels. This can be done through highly integrated consortia using vessel sharing agreements or simply by slot charter agreements. This is exchanging slots on vessels. The features of consortia are that they share capacity to create regular weekly sailings for each line's clients. Where consortia cooperate across trades, these are known as alliances. It's important to note that these aren't conferences. So shipping conferences were abolished in 2008 and these allowed lines to collaborate on price and capacity. Here we're talking about collaborations in relation to capacity only. Today, the consortia that are often talked about are the large East-West alliances. Here, most of the world's top 10 lines participate in one of three alliances, the Alliance, 2M, and the Ocean Alliance. However, there are a lot more consortia than just these three alliances. These big alliances are famous because they operate on the world's largest trades. However, it's important to remember that there are other small consortia and alliances. They operate north-south and they operate regionally. In the Med, for example, there are lots of smaller lines operating in consortia and they shouldn't be forgotten. So what did the consortia block exemption do? So a good place to start is what are block exemptions? So block exemptions allow businesses to carry out and collaborate on activities that would usually be caught by competition law. So what did the consortia block exemption let lines do? So this regulation was introduced in 1995 and renewed in 2014 and 2020. And it specifically allows shipping liner companies to form consortia and operate a joint service on vessels and share port facilities under certain conditions so the main condition in this was that the lines together wouldn't have a market share of over 30 percent and the period of the agreement and lock-in had to be limited the agreement also had to not have any hardcore restrictions you can't do things like price fix or market share and and it's also worth noting that when the UK left the European Union it adopted the consortia block exemption regulation. The benefits of this law were that it facilitated these consortia by making the competition or assessment easier there was a regulation that laid down what lines could do this created legal certainty reduced risk reduced legal costs it was it's a straightforward a