Workshop Good Practices forShip Vetting

12 October 2011

Nicole L Maréchal

Senior Legal Counsellor & Governance Officer

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Legal aspects of ship vetting Guidelines

The Guidelines are of voluntary nature, not made mandatory by law

It is a risk assessment process and risk prevention system, proposed in application of Responsible Care

We (lawyers) are also looking into activities including Guidelines aimed at improving Health Safety & Environment to prevent (legal) risks occurrence

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Legal aspects of ship vetting Guidelines

Need to have these Guidelines as any Cefic activities conforming with competition compliance to avoid breaching law but also to have any misunderstanding from competition authorities

It is not because you are working within Responsible Care / Product Stewardship / HSE that competition law would not apply → you need to check and to comply

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EU Competition Law

To ensure competition compliance how to proceed:

• Look at the prohibition of cartels (basically Article 101 TFEU)

• Also at the Commission Guidance on Horizontal Agreements, including standardization

• Apply this to the Guidelines

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Does Art 101 (1) apply ?Are the 4 conditions of 101

(3) met ?

Infringement - Sanctions such as:

• Fines (huge)

• Agreements void & unenforceable

• Damages

• Criminal sanctions

Any applicable block exemption -

Guidelines ?

OK

OK

OK

No No

Yes

Yes

No Yes

Cartel prohibition – 101 TFEU

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Cartel prohibition

• May also apply to activities of a trade association• In addition to usual cartels (eg decision on price,

sharing clients, limiting output) cartel prohibition may also apply to systems organised via HSE guidelines

• There is a grey zone into which carefulness about activities management is required

→ pattern your activity on the right way

Need to be looked at this from Cefic view point, as well as the company one and along the chain

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Ship vetting Guidelines - compliance

Ship vetting Guidelines – any system alike needs to fulfil the following characteristics:

No exclusion of actual or potential competitorFreedom to develop alternative systemsTransparencyMeans to be proportionate to aimsExchange of information to be limited to the minimumSystem to be open and non-discriminatory

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Ship vetting Guidelines - compliance

The choice of the logistic service provider is based entirely on the individual decision-making process of each company, which may or may not include criteria/procedure/system developed by the Guidelines

It is certainly NOT a collective decision-making process organised by Cefic or chemical companies to collectively de-select logistic service providers

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Ship vetting Guidelines - compliance

It IS NOT a:• Certification system to be compared to ISO, or a

standardization system• A pass/fail system or system to white/black list providers• An exclusive system replacing any existing or future systems

But it IS a:• A means that companies would use to help avoidance of

accident based on voluntary participation• One of the tools that company may use when choosing their

respective logistics provider• System to be operated in a non-discriminatory and non-

exclusionary manner

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Thanks your attention

I wish you the best for developing and applying your own Ship

Vetting system