P3 Alliance Abandoned After Chinese Rejection
The Chinese Ministry of Commerce (MOFCOM) announced that they have not approved the P3 Network (P3). P3 was a long-term operational vessel sharing agreement proposed by MSC, CMA CGM, and Maersk Line. The MOFCOM’s decision follows a review under China's merger control rules.
The P3 partners take note of and respect MOFCOM’s decision. Subsequently, the partners have agreed to stop the preparatory work on the P3 Network and the P3 Network as initially planned will not come into existence.
“In Maersk Line we have worked hard to address the Chinese questions and concerns. So of course it is a disappointment. P3 would have provided Maersk Line with a more efficient network and our customers with a better product. We are committed to continuing to be cost competitive and offer reliable services,” says Vincent Clerc, Chief Trade and Marketing Officer, Maersk Line.
Maersk Line has served China with reliable liner shipping for more than 80 years and remains dedicated to cooperate closely with the Chinese authorities and serve our customers.
“The decision does come as a surprise to us, of course, as the partners have worked hard to address all the regulators’ concerns. The P3 alliance would have enabled Maersk Line to make further reductions in cost and CO2 emissions and not least improve its services to its customers with a more efficient vessel network. Nevertheless, I’m quite confident Maersk Line will accomplish those improvements anyway. It has delivered on those improvements over the last five quarters in the absence of P3 and I’m confident it will continue to do so,” says Group CEO Nils S. Andersen.
The lack of implementation of the P3 Network will have no material impact on the Maersk Group’s expected result for 2014.
About P3
On 18 June 2013, Maersk Line, MSC Mediterranean Shipping Company S.A. and CMA CGM announced their intention to establish a long-term operational vessel sharing agreement on the East – West trades, called the P3 Network (P3). The overall aim with P3 was to make container liner shipping more efficient and improve service quality for the shippers due to more frequent and reliable services.
P3 was intended to be an operational, not a commercial, cooperation.
On 24 March 2014, the U.S. Federal Maritime Commission (FMC) decided to allow the P3 Network agreement to become effective in the US, and on 3 June 2014, the European Commission informed the P3 partners that it had decided not to open an antitrust investigation into P3 and had closed its file.
P3 was scheduled to start operations in the autumn of 2014.