APM have announced that competition authorities in China have rejected the planned P3 Network alliance in East-West container trades. Photo: PA
China's Ministry of Commerce has confirmed its rejection of the P3 application. The P3 was to be an operational alliance made of three leading global container shipping companies, Maersk Line, MSC and CMA-CGM.
The ministry stated that, with investigations and reviews, it believes that the network formed by this alliance will limit or exclude competition in the Asia-Europe container shipping market.
As a result, the ministry made the decision to turn down the application of P3 in accordance with China's Anti-Monopoly Law.
As of 1 January, 2014, Maersk Line, MSC and CMA-CGM share 20.6%, 15.2% and 10.9% respectively in the Asia-Europe services, in terms of capacity, and any of the three is bigger than its competitors.
The Herfindahl-Hirschman Index (HHI), a commonly accepted measure of market concentration, in the Asia-Euro container shipping market, will climb from 890 to 2240 once P3 launched, stated the ministry.