EU Shipping Law

Vincent Power

Document

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CHAPTER 7 European Union law relating to freedom to supply services: international services; cabotage services; and shipping services generally

A. Introduction

7.001 One of the fundamental1 principles of European Union (“EU”) law is that, as a general principle,2 nationals of each Member State are legally entitled to provide services to persons in all other Member States; while conversely, nationals in any Member State are generally entitled to receive services from persons in all other Member States. It is an entitlement which is of enormous significance in many areas of the economy including shipping. However, the general rules of EU law relating to freedom to provide services do not apply to maritime transport3 so a special regime had to be established for the transport sector. This regime is embodied primarily in Regulation 4055/864 and Regulation 3577/925 – the former deals with international maritime services while the latter deals with cabotage or domestic services. Services in ports are dealt with in the general EU regime relating to services but services between ports are dealt with by either Regulation 4055/86 or Regulation 3577/92. The principle of “freedom to provide services” has therefore been applied to the maritime transport sector by way of special secondary legislation but it does not differ too much from the general principles of the Treaty on the Functioning of the European Union (“TFEU”). 7.002 The significance of the possibility of providing services in shipping throughout the EU should not be underestimated.6 Even if a national of, for example, France decides not to provide services in another Member State, that is not the end of the matter – a

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national from one of the other Member States could well decide to offer services to French customers and thereby seek to “steal” the French national’s own customers. When the EU rules apply then the services are supplied in the host State on the same conditions that would apply to nationals of that State so Member States may not discriminate in favour of their own nationals.7 Freedom to provide services is an issue which has been particularly controversial in traditionally closed markets such as the Greek island traffic market. Indeed, the notion that there would be freedom to provide services in ports led to rioting in Brussels while the two failed proposals for port services directives were being debated. 7.003 The issue of freedom to provide services may be categorised into:

(a) the freedom to provide international shipping services;
(b) the freedom to provide domestic shipping services (this latter freedom relating to domestic services, known as “cabotage”, is more controversial than the freedom to provide international services because it involves an intrusion into areas traditionally the preserve of national service providers); and
(c) freedom to provide related services such as services in ports and services to shipping companies.

7.004 Karamitsos has observed that unlike

“air or rail, maritime transport had a long tradition of freedom well before the creation of the [EU]. Therefore, Europe’s tasks in the creation of the internal market have been simpler, perhaps with the exception of cabotage in some jurisdictions.”8

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