India is looking to exempt Vessel Sharing Agreements (VSAs) in the container shipping industry from antitrust laws for a period of three years. This exemption comes with the stipulation that at least 5% of the total space in these agreements must be allocated to Indian-flagged vessels and another 5% to Indian non-vessel operating common carriers (NVOCCs). The draft notification regarding this initiative was issued recently and aims to boost India’s presence in global container trade. The Directorate General of Shipping (DGS) explained that the goal of this draft notification is to promote fair competition, enhance transparency, and ensure better representation of Indian shipping lines and NVOCCs in the international market. This is particularly important given the current challenges in the maritime sector, such as fair space allocation and anti-competitive practices. NVOCCs act as intermediaries for shipping companies and their customers, consolidating cargo without owning or operating ships. The DGS emphasized that the conditions outlined in the notification specifically address these market challenges, with a focus on including Indian-flagged vessels. The DGS will closely monitor the operation of these VSAs during the three-year exemption, ensuring compliance with the stipulated terms and conditions. They may request information from relevant parties and conduct inquiries based on complaints or practices that violate Indian laws. This information could relate to issues like refusal to negotiate with shippers, non-transparent fees, discriminatory practices, or any anti-competitive behavior. The findings from these inquiries will be shared with the Competition Commission of India to assess whether the VSAs have a harmful impact on competition. This isn’t the first time VSAs have been exempt from certain provisions of India’s Competition Act; they’ve enjoyed this exemption since 2012, with the most recent period ending in July. The exemption applies to carriers of all nationalities operating ships from any Indian port, as long as these agreements do not involve price-fixing, capacity limitations, or market allocation. Currently, Indian ship owners hold a minuscule share in the mainline container shipping trade, with around 99% of India’s export-import container trade by volume being handled by a few dominant global carriers, including Mediterranean Shipping Company, Maersk, CMA CGM, Hapag Lloyd, Evergreen, Wan Hai, Yang Ming, COSCO, and Ocean Network Express. This new initiative could provide a crucial opportunity for Indian players to strengthen their foothold in the industry.