The Ministry of Corporate Affairs is discussing whether to extend exemption of Vessel Sharing Agreement (VSA) and Voluntary Discussions Agreement (VDA) from the purview of Competition Commission of India (CCI).
It may be recalled that the ministry exempted these agreements from the purview of the fair trade for a period of one year in September last year.
Shipping firms enter into Vessel Sharing Agreement (VSA) with each other to share space in each other’s vessels. Voluntary Discussions Agreement (VDA), on the other hand, are entered into by these firms in order to exchange market information between them.
The ministry is said to have received public comments on the issue and is looking into the various aspects such as whether the exemption should be extended further.
Even though, VSAs and VDAs are common practices, they are perceived to be anti-competitive since these pacts facilitate sharing of vessels and market information, among others. Entities that are not part of an agreement could be at a disadvantage in the market.
Following requests from the shipping industry, the ministry allowed the one-year exemption along with some conditions.
It is learnt that the ministry would analyse the overall outcome of the exemption and related issues in detail while deciding the next course of action after the one-year period.
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