THE NEW LICENSING TERMS FOR FREIGHT FORWARDING COMPANIES ARE ANTI-COMPETITIVE

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The Competition Council last month sided with the freight forwarders in their bid to block new licensing rules imposed by the Ministry of Transports and Infrastructure.

The order of the minister of Transports and Infrastructure in question states that in order to be licensed, a freight forwarder should prove that it owns at least 50.000 Euros to cover any potential damage in their services to the customers. If the company does not have the money, it has to get a letter of credit instead of a liability insurance as stated by older rules. Freight forwarders argued that the rule breaks competition legislation and asked the Competition Council to analyse the situation.

The Competition Council decided that the new rule requiring a minimum capital affects free competition and prevents new companies to enter the freight forwarding market. The Council therefore recommended the Ministry of Transports and Infrastructure to alter the rule. The recommendation aims at reaching a normal market and competition development.