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European Seaport Policy
Patrick Verhoeven Old Dominion University Norfolk – 15 February 2012
Summary
1. Snapshot of the EU port system
2. Evolution of EU ports policy
3. Transport White Paper
4. 2012-2013 policy review
5. Conclusions
1. Snapshot of the EU port system
Common challenges
• Integration in logistics chains: – Ports are key elements in value-driven logistics chains
– This offers substantial network possibilities but also poses numerous coordination problems
• Strategies of market players: – Powerful and footloose actors control freight from origin to
destination
– Global groups invest and operate terminals in several ports worldwide
– These actors and groups have strong bargaining power
• Sustainable development of ports: – Port development calls for continuous investment in port facilities
and connections
– This creates ecological and societal pressures
Port governance
• Role of the port authority: – Regulator, landlord and „community manager‟
– Coordinator / facilitator of commercial and societal interests
• Functional profile: – Landlord model dominant with privatised cargo handling services
– Provision technical-nautical services mixed public / private
– Port authorities often provide ancillary services
• Ownership: – Mostly public, either at local or national level
– Very few privately owned port authorities (UK mainly)
– Influence economic crisis may push privatisations in some countries
• Autonomy: – Most port authorities have separate legal entity from government
– Managerial and financial autonomy very diverse
– Southern port authorities have typically less autonomy
Direct provision of operational services
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Inland barging
Rail operation
Road haulage
Passenger services
Warehousing services
Cargo handling shore-inland transport
Cargo handling ship-shore
Cargo handling on board ship
Provision of waste reception facilities
Provision of shore-side electricity
Provision of electricity (general)
Provision of water
Dredging inside the port area
Dredging outside the port area
Mooring
Towage inside the port area
Towage outside the port area
Pilotage inside the port area
Pilotage outside the port area
Port authority
Government
Private Operator
Other
Not applicable
Source: ESPO „Fact-Finding Report‟ on Port Governance (2011)
Ownership of port authorities
40%
3% 2%
35%
1% 1%
2%
16%
State
Region
Province
Municipality
Private(industry)
Private(logistics)
Private(finance)
Other
Source: ESPO „Fact-Finding Report‟ on Port Governance (2011)
2. Evolution of EU ports policy
Signing of the Treaty establishing the European Economic Community
Rome, 25 March 1957
EU Law in five easy lessons
1. Legislative “triangle”: • European Commission (right of initiative + execution)
• European Parliament (directly elected by EU citizens)
• Council of Ministers (Member States)
2. Parliament and Council work in “co-decision” on most legislative proposals
3. Primary legislation (EU Treaty) and secondary legislation (Directives and Regulations)
4. Preparatory instruments: Green (discussion) and White (policy) papers
5. Interpretative, decisional and steering instruments: guidelines, communications and recommendations
FUNDAMENTAL
PRINCIPLES EU
TREATY
OBJECTIVE: HARMONISED
APPLICATION GENERAL
TREATY RULES
Focus on competition rules and
basic internal market freedoms in
order to remove factors which
distort competition between ports.
Generally ensure a „level playing
field‟.
OBJECTIVE: BALANCED
DEVELOPMENT
EUROPEAN PORTS
Focus on investments in port
infrastructure, maritime and
hinterland connections, socio-
economic restructuration of
ports, port governance,
regional policy and spatial
planning.
Generally ensure „sustainable
development‟ of ports.
OTHER EU POLICY FIELDS
Source: Verhoeven 2009
Timeline
1961 First call for EU ports policy (« Kapteyn report » Eur. Parliament)
1974 Foundation of the « Community Port Working Group »
1992 First Transport Policy White Paper
1993 Foundation of ESPO
1995 Communication on Short Sea Shipping
1997 Green Paper on Sea Ports and Maritime Infrastructure
2001 First « Ports Package » (rejected 2003)
Ports become part of the Trans-European Transport Networks
2004 Second « Ports Package » (rejected 2006)
2007 Communication on a European Ports Policy
A sometimes bumpy road ...
Dockers unions demonstrate in Brussels and Strasbourg against EU
plans to open market access to port services (2003-2006)
Why did Ports Package I & II fail?
• Ports Package I:
– Consultation minimalist and no preliminary impact assessment
– Focus only on proposal Directive market access to port services,
no real „package‟ (e.g. State aid guidelines missing)
– Original proposal was „copy past‟ airport ground handling Directive
– Labour element („self-handling‟) became overrated symbol of
resistance, leading to „unholy‟ alliances against the entire Directive
– Compromise for conciliation was acceptable to most parties but
ultimate negotiation was rushed through
• Ports Package II:
– Commission introduced PPII in haste just before end of mandate
– Proposal did not respect final compromise reached on PPI
„Self-handling‟
All this time ports were subject to EU law
• Case-law: – application EU Treaty rules
– decisions European Court of Justice / European Commission
– particularly with regard to competition and internal market
– often far-reaching impact on port governance
• Secondary legislation: – Directives and Regulations
– in the fields of environment, safety, security, customs, ...
– often not specifically written for ports but again far-reaching impact, e.g. for port development
• Up to 2007 no coherent EU policy framework for ports
EU Transport Commissioner Jacques Barrot opens the consultation
on a new European ports policy at the annual conference of ESPO -
Stockholm, 2 June 2006
EC Ports Policy Communication 2007
Implementation
Chapter Concrete proposals Realisation
a) Performance of ports
and connections hinterland
Review TEN-T (hinterland connections ports) proposals
issued 2011
b) Capacity development
without harming the
environment
Guidelines application EU environment
legislation on port development
published 2011
c) Modernisation - Maritime Transport Space without Barriers
- performance indicators
pilot 2011
PPRISM
project 2011
d) Level playing field - guidelines State aid
- concessions
studies
horizontal
proposal 2011
e) Structured dialogue
between cities and ports
- „Open Ports Day‟ (European Maritime Day)
- support R&D projects
annual
ongoing
f) Work in ports Sociale dialogue at EU level demand 2011
3. White Paper on Transport 2011
Trans-European Transport Networks
• TEN-T = transport infrastructure masterplan EU
• Ports so far remained in the margins of TEN-T:
– took until 2001 before they were part of TEN-T
– identification of priorities major taboo
– very little EU support as a result
• New proposals bring ports centre-stage:
– + 80 core network ports / port clusters
– core network ports to have adequate hinterland connections by 2030
– multi-modal corridors start and end in ports
– co-funding up to 20% (hopefully up to 40%)
– approx. 300 comprehensive ports
– comprehensive ports to have adequate connections by 2050
Review Ports Policy
• Integration in TEN-T brings obligations for ports:
– connected by rail, road and – where possible – barge
– offer at least one terminal open to all operators in a non-
discriminatory way
– apply transparent charges
– have equipment to ensure environmental performance of
ships in ports (in particular reception facilities for ships‟
waste)
• White Paper announces initiatives on a maritime
“Blue Belt” and market access to ports:
– “Blue Belt” of free maritime movement in and around
Europe with appropriate port facilities (“Blue Lanes”)
– Establish a framework for the granting of Pilot
Exemption Certificates in EU ports
– Review restrictions on provision for port services
– Enhance the transparency on ports‟ financing,
clarifying the destination of public funding to the
different port activities, with a view to avoid any
distortion of competition
8 September 2011:
Commissioner Kallas confirms
third Ports Package during
visit Port of Rotterdam
“We have to become harder”
• Issues: - Administrative simplification (Blue Belt)
- Transparency of port financing
- Quality and market access port services
• Timing: - 2012: consultation and preparation (studies)
- Early 2013: publication
- Concrete content and form not determined yet
4. 2012-2013 policy review
a) Concessions
b) Public financing and State aid
c) Technical-nautical services
d) Port labour
a) Concessions
• Question: “How can port authorities equitably allocate
port sites and how can they guarantee quality of service
and continuity of investment in a transparent manner?”
• Issues:
– Definition „concession‟ and transparency implications
– Proportionality: should one always tender ?
– Discretionary powers port authority
– Prolongation of contracts
• On-going initiatives:
– Proposal horizontal Directive (DG Markt)
European port authorities using public selection
procedures to contract out port land
32%
21%
19%
28% Always
Only for plots of land that are of strategic interest
Subject to other conditions
Never
Source: ESPO „Fact-Finding Report‟ on Port Governance (2011)
b) Public financing and State aid
• Question: “To what extent can governments contribute
(in)directly to the financing of ports?”
• Issues:
– Long-standing request EP and port sector for State aid
guidelines delayed because of different views within Commission
– Port sector favours traditional distinction between basic
infrastructure (no State aid) and project-related infrastructure and
superstructure
– Transparency of accounts
• On-going initiatives:
– Study commissioned by EP TRAN
– Study commissioned by DG Competition
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Pipelines outside port area
Locks other than sea locks outside port area
Canals and navigable waterways outside port area
Tunnels and bridges outside port area
Road infrastructure outside port area
Railway infrastructure outside port area
Pipelines inside port area
Locks other than sea locks
Canals and navigable waterways inside port area
Tunnels and bridges inside port area
Road infrastructure inside port area
Railway infrastructure inside port area
Other cargo-handling equipment
Mobile cranes
Fixed cranes
Other buildings
Warehouses, sheds, …
Docks, quays, jetties, including back-up land
Land reclamation for port works
Sea locks giving access to port area
Exterior breakwaters
Radar and other electronic aids to shipping
Lighthouses, buoys, etc.
Access channels (dredging)
Port authority
Government
Private operator
Other
Combination
Not applicable
Source: ESPO „Fact-Finding Report‟ on Port Governance (2011)
Accounting practices European port authorities
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Port authority has to provide for depreciation
Port authority has internal analytical accounting process
Port authority publishes annual accounts
Port authority accounts are audited by an external auditor
Port authority accounts are kept to international accounting standards
Port authority maintains separate accounts
Yes
No
Source;: ESPO „Fact-Finding Report‟ on Port Governance (2011)
c) Technical-nautical services
• Question: “Under what conditions can technical-nautical
services, and especially pilotage, be run as public
service monopolies?”
• Issues:
– Qualification services of general economic interest
– Modernisation of services (e.g. shore-based pilotage)
– Mandatory use even if not required (pilot exemption certificates)
• On-going initiatives:
– Study on Pilot Exemption Certificates commissioned by DG
Move
d) Port labour
• Question: “To what extent are labour pools compatible
with Treaty principles on free movement of services
and persons?”
• Issues:
– Mandatory use of labour pools
– Restricted access to port labour profession
– Training and qualifications
– Outdated and restrictive practices
• On-going initiatives:
– Study on port labour commissioned by DG Move
– Set up of EU social dialogue
5. Conclusions
• Supra-national level EU has the potential to develop an independent legal / policy framework
• So far this potential has not been fully realised and the influence is mostly indirect (case-law / soft law)
• Commission reviews its soft law policy in 2012, result still uncertain
• EU rules on State aid and concessions will, when fully applied, influence investments and financing of ports and have a harmonising impact on port governance
• TEN-T core network and related (EU) financing can influence the European port landscape
Thank you for your attention
Patrick Verhoeven – Secretary General
European Sea Ports Organisation (ESPO) vzw / asbl
Treurenberg 6 – B-1000 Brussel / Bruxelles - Tel + 32 2 736 34 63 – Fax + 32 2 736 63 25
Email: [email protected] – www.espo.be
