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  June 17th, 2017 | Written by

Mexico Fines Ocean Carriers for Monopolistic Practices

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  • Mexican government agency imposed fines on seven ocean carriers.
  • Mexican competition commission found seven ocean carriers allocated maritime routes involving Mexican ports.
  • Agency found ocean carriers sought to reduce competitive pressure and increase prices.

The Board of Commissioners of the Mexican Federal Economic Competition Commission (COFECE) determined that seven shipping companies are responsible for committing “absolute monopolistic practices” by implementing agreements to divide the market of maritime transportation of motor vehicles among themselves. The fines imposed on the carriers amount to 581,660,000 Mexican pesos, or around $322 million.

The ocean carriers in question are CSAV, K Line, K Line America, Mitsui OSK Lines (MOL), Mitsui OSK Bulk Shipping (MOBUSA), Nippon Yusen Kabushiki Kaisha (NYK), and Wallenius Wilhlmsen Logistics (WWL).

According to COFECE, the sanctioned companies provide maritime transportation services globally to original equipment manufacturers that produce and/or sell motor vehicles. The companies overlap on different routes that involve Mexican ports. Between 2009 and 2012, COFECE found, the companies entered nine collusive agreements—in some cases extending into 2015—to allocate among themselves the national market of maritime transportation of motor vehicles and construction and farming equipment.

“This reduced competitive pressure and increased the costs of the services provided to companies from

the automotive industry,” a CEFECE statement said.

The automotive industry is one of the most important sectors of the Mexican economy. Mexico is the world’s seventh largest producer and the fourth exporter of motor vehicles.

The practice involved the allocation of segments of the maritime transportation routes that

included Mexico, as point of origin or destination, from or to Argentina, Brazil, Chile, Japan, Thailand, Indonesia, and Belgium. The Mexican ports involved are Altamira, Veracruz, Manzanillo, Mazatlán, and Lázaro Cárdenas, where loading or unloading of motor vehicles leaving or entering Mexico was carried out.

The shipping lines have the right to appeal the COFECE decision to the Mexican courts.