Sri Lanka: Another Case Filed against Shipping Industry Monopolisation

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(Image Courtesy: Colombo Gazette)

The Sri Lankan Court of Appeal last week issued notices on Ocean Network Express (O.N.E) and alleged partners on trade monopolisation and others returnable for March 19. The bench comprised Justices P.Padman Surasena (President/CA) and Shiran Gooneratne.

Parliamentarian Vasudeva Nanayakkara, the whistle-blower in this case, filed Writ petition citing Director General of Merchant Shipping, Ports & Shipping Minister, Finance & Mass Media Minister, Hayleys Advants Ltd., McLarens Investments (Pvt) Ltd., Ocean Network Express (O.N.E) Lanka (Pvt) Ltd., and UMI Shipping (Pvt) Ltd., as respondents.

Petitioner in his public interest litigation alleged that Hayleys Advants and/or McLarens are monopolising and carrying out restrictive practices in the Sri Lankan shipping industry. He added that Hayleys Advants has acquired 94.81 per cent equity of Sri Lanka Shipping Company Ltd for a purchase of about Rs 4.9 billion (USD 31.60 million).

Nanayakkara impugns the acquisition is in line with the Hayleys PLC groups strategy of ‘expanding its maritime operations and paving way for the establishment of the largest marine and shipping company in Sri Lanka.’

“Hayleys Advants Ltd. is said to control 70 percent of Sri Lanka’s shipping and maritime services market and laments it is seeking to acquire more acquisitions in the shipping sector with a view to increase its market share in the future. All those principals operate in Sri Lanka through companies incorporated to carry out their operations in collaboration with their respective agents,” Nanayakkara mentioned in the petition.

Restrictive practices and monopolisation causes inefficient allocation, social and economic disparity, provision of inferior services, elimination of competition, dominant entities, prevention of new entrants and considerable political influence to scuttle political and regulatory process, he elaborated.

The Finance Ministry has ensured that competition within the industry will be fair and balanced, with unfair trading practices being eliminated through enactment of prudent regulation, he points out. He is seeking an order from the court to restrain the Director General of Merchant Shipping from entertaining the application of Network Express (O.N.E) and an interim order as well.

“In spite the government’s intention to introduce reforms to open up the shipping industry to competition, the most dominant shipping companies are continuing through various means to monopolise the industry and engage in restrictive practices,” the petitioner added.

(Source: The Daily Mirror, Sri Lanka)

Sea News, February 13