Nine Container Storage and Transportation Companies Fined NT$45.45 Million by FTC Lose Administrative Lawsuit

Reporter Lin Meng-chieh / Taipei Instant Report

Evergreen International Storage and Transport and 20 other companies decided to reinstate a mechanical usage fee for handling CFS export cargoes under 3 tons. The Fair Trade Commission (FTC) ruled that this violated the Fair Trade Act and imposed fines totaling NT$65.25 million. Nine of these companies, dissatisfied with the decision, filed an administrative litigation. Today, the Taipei High Administrative Court ruled against them, upholding the original decision. The companies have the right to appeal.

The Container Terminal Transport Association R.O.C. issued a letter on April 30, 2014, stating that its member container yards would resume charging a mechanical usage fee for handling CFS export cargoes under 3 tons from July of the same year, at a rate of NT$55 per ton. After receiving a complaint, the FTC investigated and determined that Evergreen International Storage and Transport and 20 other container yards had collectively decided to reinstate the fee, which constrained business activities and impacted the market for container logistics services, thus violating the Fair Trade Act. The total fines initially amounted to NT$72.6 million.

The companies filed an administrative lawsuit, and the Taipei High Administrative Court initially overturned the FTC’s decision. After a re-evaluation, the FTC reduced the fines to NT$65.25 million. Among the fined, nine companies, dissatisfied with the NT$45.45 million penalty, sought further administrative relief.

The court noted that before July 2014, none of the 21 companies had charged a mechanical usage fee for handling CFS export cargoes under 3 tons. After the association’s letter, the companies gradually resumed charging the fee. The fee structure showed that only Central Freight Terminal charged NT$50 per ton, while the other 20 companies charged NT$55 per ton, indicating a collective agreement to resume the fee, which constrained business activities.

The court further stated that the 21 companies were engaged in horizontal competition within the container logistics industry. To avoid losing business opportunities by reinstating the fee individually, they reached a consensus to resume the fee during an association gathering and notified relevant units through the association, thus reducing the competitive risk for any single company and impacting market functionality.

The ruling pointed out that the collective action involved 21 companies, representing over 60% of the national market. Considering the total revenue and export volume of the nation’s container yards, these 21 companies accounted for more than 80% of the market, significantly impacting the supply and demand functions of the container logistics service market. Therefore, the FTC’s fines were justified, and the companies’ lawsuit was dismissed.

United Daily News, June 12, 2024

 58 total views,  2 views today