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Shipping (Anti-Trust Litigation)

Volume 12: debated on Thursday 5 November 1981

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asked the Secretary of State for Trade if he will make a statement on the current anti-trust litigation in the United States of America against British shipping lines trading in the North Atlantic.

The then Under-Secretary of State, my right hon. Friend the Member for Chingford (Mr. Tebbit) reported to the House on 14 June 1979 the Government's grave concern at the prosecution by the United States authorities of British shipping interests and British nationals for alleged violations of United States anti-trust laws arising out of their trading in the North Atlantic. That prosecution led to the imposition of heavy fines on the British and other defendants, and then to a further and even more serious action for the recovery of civil damages alleged to have arisen out of the same violations. A settlement has now been announced.The conduct of which the British and European lines stood accused was entirely lawful in their own countries. Moreover, much of it fell outside the internationally-accepted jurisdiction of the United States.In spite of this, United States law provides that even where there has been a penalty paid as the result of a Government prosecution, there can also be penal—treble—damages awarded by a civil anti-trust action in respect of the same conduct; and that each party to an alleged conspiracy is liable for the whole of any judgment awarded against all the parties, without legal recourse to the others. The British shipping lines concerned have explained to my Department that in these circumstances they and the other European lines saw no alternative but to join their United States co-defendants in the negotiation of an out of court settlement, whatever their views on the substance of the allegations.My Department was kept fully informed by the lines as these cases developed.Successive British Governments have sought to alert United States Administrations to the dangers of the unilateral application of one country's laws to an international activity such as shipping outside the accepted limits of its jurisdiction, and to the friction that this must introduce into other aspects of our relations. These fears have now been borne out, with results which can only increase the uncertainties facing shipping lines on the North Atlantic and inhibit international trade.I am glad to be able to report that the United States Administration now has its policy on merchant shipping under review, has acknowledged the need for common shipping policies between the United States and its trading partners, and has called for consultation to that end with the European maritime countries. Her Majesty's Government, like other European Governments, have accepted this invitation: we look forward to the consultations and hope that they will be carried to a successful conclusion. The recent litigation demonstrates their urgency.