EU Shipping Law

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An overview of European Union transport law

A. Introduction

Purpose of this chapter

4.001 This chapter examines selected aspects of the law of the European Union (“EU”) as it relates to transport1 generally.2 An understanding of the EU law relating to transport in general is useful in trying to understand the EU law relating to shipping in particular. This short chapter therefore forms a backdrop to the discussion of EU shipping law which follows in later chapters. In particular, this chapter examines the provisions relating to transport in the Treaty on the Functioning of the European Union (“TFEU”).

Importance of transport in the EU

4.002 Transport is an inherent part of any economic community – it is, however, particularly important in the EU’s economy. First, it accounts for about 6.3% of the EU’s gross domestic product (“GDP”)3 and this is more than agriculture – indeed, agriculture and transport were the only economic sectors which had Titles devoted to them in the original EEC Treaty. Transport is the subject of a common policy under Article 3 of the EU

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Treaty. Under Article 4(2) of the TFEU, there is shared competence between the EU and the Member States in regard to transport. Second, the opening up of the Central and Eastern European markets as well as the completion of the EU’s internal market requires a common transport policy and legislative regime.4 Third, it is worth remembering that transport is a huge employer around the EU with many millions of people employed in the transport sector in the EU. Fourth, the development of such freedoms as free movement of goods, services and persons presupposes a transport system. Ultimately, the integration of the EU requires the development of a transport system: there is an ongoing need to have a low-cost, highly efficient, competitive and optimum transport system, allowing transport users a reasonable choice and transport operators a fair return on investment.

Need to achieve a common transport policy

4.003 Transport is one of the foundations of the TFEU: a common transport policy (“CTP”) is a necessary pre-requisite if the internal market is ever to be achieved and maintained. A common policy envisages national policies being recast into one single EU policy: the national becoming supranational. The need to adopt such a policy was identified as early as the Spaak Report which was adopted even before the EEC was established.5 The TFEU provides for the adoption of such a policy. The CTP is vital for the EU given its size and population. There is a need to integrate all areas of transport policy: for example, there is a need to co-ordinate road and rail networks with the building and operation of ports and ferry ports. The CTP needs to be not only coherent in itself, but also integrated with many of the EU’s other policies such as agriculture (e.g. the carriage of food aid), the environment (e.g. pollution), competition (e.g. prohibition of unfair pricing practices) and social policy (e.g. dealing with unemployment among shipbuilding workers made redundant). The CTP must also take into account what is happening in other European organisations (such as the Central Commission for the Navigation of the Rhine, the Moselle Commission, the European Conference of Ministers for Transport, the Council of Europe and the Economic Commission for Europe) as well as international bodies (such as the International Maritime Organization and the United Nations Conference on Trade and Development). Sadly, neither internal nor external integration has taken place fully despite much work being done. The CTP needs to be not only a common policy but also a coherent one.

Failure to achieve a CTP

4.004 Despite the need for a CTP, a comprehensive policy remains somewhat elusive. The elements of the policy which have been adopted so far are somewhat unconnected and incomplete: it has been a “policy of steps”. The lack of achievement in achieving an EU transport policy is due, for the most part, to the lack of a common will on the part of the Member States because of their differing interests and attitudes. It has also been

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difficult because of the differences and divergences between the transport systems in Member States. The Common Agricultural Policy (“CAP”) has been, despite its many critics, a remarkable achievement – the diversity of interests, the plethora of products and the complexity of the politics involved have all been overcome to produce a common agricultural policy. The CTP is not as integrated as the CAP but progress can be reported, indeed substantial progress in recent years can be reported. Various commentators have discussed the reasons for the failure of the EU to adopt an effective CTP for many years. Lowe has argued that the:

“reason that no great progress in this area has been made is that Member States have their own divergent views as to the priorities of transport as well as their own quite individual geographic, economic and cultural considerations. Certain states have adopted strict interventionist policies while others have adopted a much more liberal approach to government participation in transport. In particular, for example, we have seen the desire of some individual Member States to adopt and maintain protectionist policies towards their railway systems, waterways and ports. In other cases protection of road systems is important because of the inherent dependence of the smaller countries of Europe on their road networks. To date there has been no definable incentive for these considerations to be pushed aside in the common good but the implementation of the Single European Act now changes this position and the new vision of a single market provides the incentive.”6

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