Japanese Trio Says All Needed Approvals Secured
Japan’s shipping majors Nippon Yusen Kabushiki Kaisha (NYK), Mitsui O.S.K. Lines (MOL), and Kawasaki Kisen Kaisha (K Line) have missed the establishment date for their joint venture company despite claiming to have received all necessary approvals for compliance with local competition laws.
According to the companies, the approvals were granted in regions and countries where compliance is required for the establishment of the new joint venture (JV), which will operate under the tradename Ocean Network Express (ONE).
However, the trio has been faced with hurdles from the Republic of South Africa as the country’s competition commission decided to block their proposed merger in late June. The commission has prohibited the deal as it found that the structure of the container liner shipping market “is conducive to coordination based on previous collusive conduct in the container liner market in other parts of the world.”
The companies said they expect to complete the approval process for compliance with competition law before the service commencement date of April 1, 2018.
Furthermore, they informed that progress is being made towards completing the establishment of the new integrated container shipping business.
“Overall, there is no impact on the three companies’ integration plans for the new container shipping business, and the service commencement date for the new company is likewise unchanged from April 1, 2018,” according to MOL.
The trio earlier announced the expected establishment of a holding company and an operating company by July 1, 2017 for the integration of the three companies’ container shipping businesses, including terminal operation businesses outside Japan.
In late June, the European Commission granted its approval for the creation of the joint venture, adding that it concluded that the proposed acquisition “would raise no competition concerns given the limited impact of the transaction on the routes to and from Europe and the fact that there would be sufficient competitive pressure from other competitors post transaction.”
