The “Treaty”-T, which established EC¹ signed by 6 nations in Rome in 25^th March, 1957 (Photo 1).

The main targets of the EC-T-1957, after 2 deadly² global wars, were six (Graph 1):

The member-states which consisted EU-28, and their year of accession (Table 1), is shown.

(Scan 1) It took 16 years, (till 1973), for EC-6 to be enlarged, due also to a 12-year transition period (till 1969). For EU-27’s further transport integration, we believe, Serbia must be accessed. Certain—especially non-monetary, but cultural targets—have further to be pursued… The effort of…“Europe-zation” was really a great task, though certain elements uniting European People existed like: “Peace! No War”!

The elements dividing Europe were/are also important: 1) the war among certain European nations in 1940-1944 (against Germany³; Italy⁴; Bulgaria etc.); 2) the diverse history (Greece⁵); 3) the different religion; and 4) the dual “working attitude” between North and South.

Photo 1. The 6 original members of the EC, 1957, signing… Source: modified from that in “About Europe”, EC publication (in 1982?).

Scan 1. The geographical picture of EU-27, 2007. Source: “Kathimerini” assisted by the EU office of the Commission (Greece); modified.

Source: internet. (*) UK withdrew from the EU-28 on 31^st January 2020; (**) Strong offshore flag; (***) Strong offshore fleet.

The idea of forming the EC-6, we believe, was to “make” all Europeans… “brothers”! We saw, however, that the dividing nationalism never went away… The EU-6 tried to become a “family”, where…Germany was (is) the father, and France was (is) the mother! One child is Italy, while the other (UK), left the family. The father believes that…to be in this Union, means to work as hard…as Germany! Brothers in the North believe, more or less, the same. Brothers in the South, however, believe that life has and other interesting endeavors...

Moreover, if in EU-27 existed one religion, namely that of “Christian Orthodoxy⁶”, we believe, it could decisively help⁷ the European vision. In addition, the individual nationalities, we believe, did not fallback, and one⁸ “European nationality” did not become dominant; though any discrimination on grounds of nationality was indeed against EC-6-T-1957.

Unfortunately, EU-27 failed to put aside national interests in favor of solidarity! Germany and Spain sell arms etc. to Turkey in 2021, which Turkey threatens Greece with war. This is a clear case of nationalism⁹…and anti-solidarity.

Certain important positive steps were taken by EC-15¹⁰ (Table 2), no doubt:

The aim of this paper is to analyze, with a critical attitude, the EC-6-15 common shipping and maritime policy, during its first 40 years (1957-1997). Also, to present the recent EU-27 “fit for 55”.

Source: author. (*) Something we disagree.

The structure of this paper is as follows, after literature review: Part I deals with the power of maritime EC-9-28. Part II deals with the tools that EU-15 adopted to carry-out its duties and solve its problems. Part III deals with the EC-6-15 period of 27 years of inertia to form a CSP/CMP (1957-1984). Part IV deals with the laying-down of the foundations of a CSP/CMP (1985-EC-10). Part V deals with Commission’s communication “towards a New Maritime Strategy” (1996; EU-15). Part VI touches upon the future Common Marine Policy-EU- 25-27 (1998-2021). Part VII deals with the “fit for 55”. Finally, we conclude.

Couper (1977) admitted that the EC-6-Treaty-1957 contained no official shipping policy. Article 84 (2), however, gave the Council the power to decide on sea transport issues. Additionally, some general Treaty principles, related to monopoly and preferences, could be also interpreted as applying to shipping—but this was a view not shared by all member-states.

Captain Spartiotis (1980) of the Greek Ministry of Mercant Marine¹¹, argued that the EC-9 CSP started in 1974, with the “Court case” of the “Commission vs France”. In fact, the relevant cases were 3 (Graph 2).

Spartiotis also argued that there were 2 economic policies in EU-10: one supporting the “state-intervention”, carried out by Commission, and the other supporting “economic liberalism”. Apart from the above 2 opposite economic philosophies, role played also the national interests and the expediencies…of the member-states.

Farthing & Brownrigg (1997: pp. 62-67) argued that the “1987 single European Act”, amending the EC-6-T-1957, completed the “single European market” and lowered further any remaining barriers among member-states, so that to form an “open market” (by 01/01/1993). The “Maastricht-T”-1991 extended the powers of the European Parliament, and provided the CM increased votes, by the majority rule (Table 3 & Table 4)!

(*) Plus, a common discussion with the newly formed ‘‘Economic & Social” committee.

The institutions of the EC-12 strengthened in Maastricht. A “single market” surely needed the free movement of the factors of production, including capital. But the free movement of labor was theoretical, we believe, for EU-12’s manpower, due to existing different languages, diplomas¹² and other barriers. The aim of the “Maastricht-T”-1991 (EC-12), was a more intense integration in the monetary area with one common currency, one defense, and one common foreign policy. At the moment, NATO¹³ protects EU-27 and FRONTEX its borders.

The EC-12’s benefits, however, were not without a cost: member-states gave-up part of their sovereignty, in general, and in maritime issues, in particular, and their Parliaments weakened, because the laws of the EU override those of the member states. A rich source of knowledge about EU-15 is Power (1998), used also for writing this paper.

Stopford (2009: pp. 88-89) argued that EU-27 wanted to apply its regulations also to dry cargo companies & their pools. Competition, which was regulated by articles 81 & 82, ruled as illegal the companies which prevent, restrict and distort competition by fixing prices, manipulating supply etc. (p. 690). In 1962 regulation 17¹⁴ gave EC-6 the power to enforce articles 81 & 82, except in sea transport (& Air)!

Casaca (2012) argued that the different communications from EU-27 showed that maritime transport needed integration, especially in the multimodal/inter- modal transport chains, but in a rather systems approach. She provided a detailed account of CMP from 1957 to 2012. She also provided 96 references published by majority by the Commission! Goulielmos (2012) edited a special volume titled: “European marine affairs after world economic crisis”—meaning after 2008.

Summarizing, the equalization of salaries and wages in EU-28, which was a dream, especially of the South, remained…a dream¹⁵. Moreover, 16m of Europeans were unemployed (Oct. 2020)! The economic crisis of 2009-2018 equalized labor supply among member-states, as many e.g., qualified Greeks, sought employment in EU-27!

The EC-6-T had a “timetable” with 20 chapters. One, titled IV, devoted to a “common transport policy”—CTP. It declared that the provisions of the EC-6- T-1957 will apply only to rail, road and inland waterways! Sea (& Air) have to

wait till the CM would decide, by a qualified majority, (article 84; meaning then 62 votes out of 87 or 71%)…!

The CSP/CMP was based on 4 measures (Graph 6). The Presidency of the CM, in Dec. 1986³⁴, held by UK, to which Greece also contributed. The issued regulations completed the foundations of the EU CSP/CMP (known as “Brussels Package”).

As shown, ~28 years of inaction led—within about 11 years—to 4 proposals of a CSP/CMP (1985-1996)!

Commission communicated a memo³⁵, representing the 1st systematic attempt to design a CSP, laying-down the main lines of action for EC-10. Till then, no one, (Commission or Council), defined clearly an even general, framework, for a CSP! The communication dealt with³⁶ (Graph 7):

The communication confirmed EU-10’s shipping overall principle of “laissez-faire”, and its opposition to cases of cargo reservation, where a permission asked to undertake action. The freedom to provide shipping services concerning the: Offshore industry; EU-10’s trade with 3^rd nations, and “cabotage”³⁷, which concerned in particular Greek Coastal Shipping!

The above was based on the assumption that by “liberating” shipping markets, (except liners³⁸), a more intense competition will prevail³⁹ among ship-owners, which will make charterers able to offer cheaper⁴⁰ goods to final consumers… through a lower transport cost. However, Supply and demand only determine transport cost as it is known to those living in Jerusalem!

● The Commission enthusiastically attended Maritime Safety and the prevention of sea pollution by ships, by adopting what conventions existed 4 - 5 years already! This was easy!

It put also an emphasis on:

● A Port State Control, the Substandard ships and Crew’s working conditions.

● The coastal navigational systems & hydrography.

● Helping developing countries to train their masters, crews and maritime administrations—something of secondary importance—but of good public relations.

● The issue of ports, and the competition among them, and state aid⁴¹, which was important.

In the 2^nd-half of 1981 (EC-10) started a “deep & prolonged shipping cycle”, till the 1^st half of 1987, affecting the dry cargoes (EC-12). The ECOSOC committee found that the then existing CSP was: deficient, static, unpragmatic, unrealistic and unaware of the changes occurred, or occurring, in Trade⁴²! This indicates

that till 1985 (EC-10) the Commission lacked a coherent and comprehensive CTP…

➢ The 1^st stage towards a CSP

The “1986 package” (EC-12) brought-in 4 regulations (Graph 8), which were adopted by the CM. The aim was to maintain and develop an efficient and competitive shipping industry for the benefit of the EU-12-trade!

In more detail, in 1986, the EC-12-regulation 4055 applied the freedom in providing services to maritime transport, and regulated the relations of EU-12 with 3^rd countries (cabotage excluded). Reg. 4056 laid-down detailed rules for the application of articles 85 & 86 of the EU-6-T to maritime transport. Also, for the negotiations with 3^rd countries on unfair pricing policies. This excluded tramp shipping, considered to be already competitive; a view which repealed in 2006, and the tramp shipping’s exemption from pools also lapsed.

Reg. 4057 dealt with the unfair pricing practices related to dumping of maritime services (31/12/1986). Reg. 4058 concerned a coordinated action to safeguard free access to cargoes and to ocean trade. Liners considered as offering stable freight rates (true), and thus received a block exemption from Art. 81, and allowed to fix rates, regulate capacity and collude, for the time being for God’s sake!

➢ The 2^nd stage of a CSP came 3 years after, in 1989, and took the title: the “Positive measures”⁴³ (EC-12). This was a communication⁴⁴ to CM not only to improve the operating conditions of EC-12 shipping, but also to complete the 1986 CSP. Two in one.

The 1974-1987 maritime crisis caused the fleets of the EC-12 to diminish, and shipowners asked for help, as usually do in such cases. Help tried, but with a considerable delay! EC-12 tried first to define who is the EC shipowner so that to be helped... For us, the “community shipowner”⁴⁵ is the one, who registers ships

in one member-state, but also registers other ships, in another non-EC-12 registry! Let us call this 2^nd fleet: “transnational”!

Both above fleets should concern EC-12-no matter that a number of ships are under foreign flags, as both contribute to EC trade—and not only. EC (and member-states) it would be better to be concerned with the profits of community shipowners, and if these benefit their countries of birth or not! This is an important aspect which has been ignored⁴⁶!

To those that could understand shipping, the measures required, since 1974, were, in our opinion:

● To boost trade i.e., demand,

● To reduce oil prices by disciplining OPEC⁴⁷, and,

● To reduce costs of operation of EU-12 ships due to flag!

Certain member-states chose, however, the faster and easier way, i.e., to abandon national flags, for reasons of cost, and thus EC-12 fleet to shrink (Goulielmos, 2000).

In more detail, shipping industry decided to resort first to:

● Open registries, and,

● to Offshore ones.

In the first belonged the nations of Antigua, S. Vincent and Vanuatu. In the 2^nd, Bermuda, Denmark, Isle of Man, Norway etc. These combined the prestige of their national flag with the benefits of an open registry (!), something that EU-12 could not come to grips with at the beginning. The offshore registries we think is a case of shipping “globalization”. The matter of safety is a matter where discounts cannot be permitted, and the example of the “international ship register of Norway” in 1980s is a successful example!

In 1987, indeed EC-12 shipping industry established parallel registries in order to face competition! These enabled shipowners to register vessels under the (dual) national flag, and at the same time to operate them with a much “higher degree of flexibility” under the parallel registry (Anastasopoulos (1987)

The “positive measures” were (Table 8).

As shown, from the 5 positive measures, only the last 2 were really positive. The “Hellenic Chamber of Shipping”⁴⁸— HCS (1989), pointed-out that the intervention of certain commercial interests of one…member state⁴⁹, made cabotage an issue in the PMs, while it should not! It (p. 5), however, excused indirectly the situation where competition, against EU-12 ships, came from EU-12 shipowners under non-EU-12 flags, (because only the “Far East countries” mentioned⁵⁰).

HCS (p. 5) accused…PMs as being favorable to certain member-states! It further (p. 6) mentioned that the reduction of crew cost was not always the only reason to employ foreign crew, and to choose Asian crews. Member-states did not want to confront seamen’s unions.

HCS insisted in the principle—which is right at all times—for governments, and for EU-12, to avoid influencing shipowners in their managerial decisions⁵¹. This means par excellence “timing to buy ships”. It (p. 7) accused EC-11 for paying no attention to the problem, which was for EC-12 citizens to avoid shipping as an employer, for the last 30 years.

➢ This had 4 new elements (Table 9)! To start with it was wrongly titled “maritime”, because it dealt only with “shipping”, excluding ports and shipbuilding.

Besanko et al. (2013: p. 1) argued that a strategy is, in short, “fundamental to an organization’s success, and its study is, or can be, profitable and intellectually engaging”!

The communication took the form of a resolution⁵². Its relevant issues were (Graph 9).

Commission found that a “common maritime safety policy”—CMSP, has been already established. The “external maritime policy”—EMP started. But, the competitiveness of the EU-15 fleet remained unsolved (1996)! Commission excused its dealing with only shipping, because another communication filled this gap⁵³. Commission mentioned also the new development, which took place since 1985,

Source: author. (*) The issue of “cabotage” was an issue among member-states.

Source: author. (*) “Strategy” is surely an impressive term!

which was the new shipping industries, which emerged, particularly in “East Asia”⁵⁴, competing EU-15 shipping!

In our 2^nd paper, we will present the remaining period (1998-2021) for a CSP/ CMP. Also, a Common Marine policy (Picture 1) emerged in 2006.

As shown, Marine Industries, and their economics, are the broader circle including both shipping and maritime industries and their economics. These… discovered by EU-25 with a great joy, and publicity, in 2006. The joy was great because EU-25, at that time, did not copy UN or IMO, as did in the past, but designed its own “Common Marine Policy” independently, which was holistic and more general than both CSP and CMP! Surely, the focus required has been lost…

Picture 1. The Maritime cluster of the Netherlands, consisted of 10 industries. Source: Lloyd’s list, June 1999.

International shipping industry has to reduce its carbon intensity per ton/mile, by at least 40%, by 2030, and to try the 70% mark by 2050, vis-à-vis 2008. The total annual GHG emissions have to be reduced by at least 50% by 2050, vis-à-vis 2008 (according to Paris agreement).

IMO also adopted a strategy for decarbonization, in April 2018. Shipping industry considers the EU-27 “Green Deal” and “fir for 55” package ambitious. As a result, shipping industry proposed to IMO to set-up a research and development board (IMRB/IMRF), and fund, supplying it by a mandatory contribution from each vessel > 5000 GT per ton of fuel consumed. The scope is to expedite the development of an alternative fuel(s) required by shipping industry.

The EU-27 proposed a “Well-to-Wake” (WtW) certification to be developed and validated by IMO, in Sept. 2021. IMO adopted, in 10-17 June 2021, a comprehensive package of legally binding technical and operational short-term measures. Their scope is to reduce CO₂ emissions from ships (in force since 01/11/2022) (MEPC 76)).

The industry relies on technology and on carbon-neutral fuels. Also on innovation investment, on building the required infrastructure etc. (Goulielmos, 2021d). The views of shipping industry seem to coincide with those of Goulielmos (2021d) on the theory of “increasing returns to scale”!

The “fit for 55” is based on 2 foundations (Graph 13).

EU-27 considered the extension of the EU-ETS to maritime industry from 2023—phasing out also existing allowances—for vessels > 5000 GT; 100% implementation to intra-EU voyages & 50% to extra EU ones, within the MRV⁶⁴ task. The 2^nd regulation proposed the reduction of the GHG intensity of energy used by vessels by 6%, 26% and 75% by 2030, 2040 & 2050 vis-à-vis 2020 in line with MRV.

The “RED” (renewable energy directive) set fuel sub-targets (biofuels & hydrogen from renewable electricity). This looks also at the supply of electricity to ships in ports by 2030. The “AFID”—“alternative fuel infrastructure directive”— needs the development of onshore power supply in EU-27 ports by 2030 and LNG supply by 2025.

However, the international maritime community disappointed by the inertia shown by the participating governmental leaders in COP26 (Oct. 2021), where the carbon emissions from ships were further reduced from 40% it was. Moreover, the ICS (international chamber of shipping) stated that during MEPC 77 of IMO (November 2021) no real progress made! The WSC (world shipping council) underlined the hopeful sign that an increased number of states supported the establishment of a R&D fund, for making the future technologies to contribute to ships’ decarbonization!

Worth-noting is that “Maersk-shipping company” argued that the environmental impact of shipping must be reduced by adopting: 1) a global fuel standard; 2) a time limit in building ships using fossil fuels; 3) a creation of a global fund; 4) one GHG price, so that to pass to alternative fuels; 5) a creation of green sea routes; and 6) re-enforcing the system of data-collection of IMO, and its transparency. The whole above issue was supported by: BIMCO, Intertanko (owners of tankers), Intercargo (owners of dry cargo ships), WSC, etc., already since 2019 (in MEPC 75), but the whole issue passed-on…to the forthcoming MEPC 78 (2022)!

The views of the greater part of international shipping industry over the possible ways to reduce GHG emissions from ships, as a reaction to EU-27 initiative named “fit for 55” package, is to increase the existing 40% target to 55% by 2030!

Moreover, we hoped that the COP26 would be more courageous, than it was, despite the steps to decarbonize international shipping taken already. Governments, however, failed to translate words into actions! In addition, IMO MERC 77 failed to revise current GHG targets for 2030, as mentioned.

Given that the author had the purpose to write an additional paper covering the period between 1998 and 2021, the reader has rather to wait to have a complete historical picture of the total shipping, maritime and marine policy of the EU-27/28.

This paper showed the mistakes committed by Europeans in forming EU, which may be used as a guide for future economic unions. The equalization of wages and salaries, which was a target, announced, but never achieved. This needs further research. Moreover, and more important, the “national interest” instead of leaving it outside the door of EU, all nations brought it-in with them in all shipping, maritime and marine issues! This needs further research. The targets of French Revolution-equality, liberty, fraternity, remained unfulfilled…as liberty from energy needs has a long way ahead and a climate which will not kill its European citizens is also sought-after. This also needs further research.

The port interests of EC-6, we believe, excluded, originally, “sea transport” from EC-1957-Treaty, and from a “common Maritime Policy”. So, a CSP/CMP delayed 28 years, till CM undertook by UK, in 1985, with contributions from Greek transport commissioners. UK was an island country, with a long past ship-owning, port and shipbuilding experience.

EU-6 shipping policy, by the influence of transport commissioners Anastasopoulos and Petropoulos, centered, initially, round the state-members that were “cross-traders”, like Greece. Thus, EU followed all along the principle of “laissez-faire”, but with 2 exceptions: the “tramp shipping pools” and the “liner shipping conferences”!

For safety, an EU-10 common shipping policy was easy, as it copied already the maritime nations acting through IMO, with a 4 - 5 years delay! Moreover, a policy for liners was also easy, at that time, in 1976, copying United Nations’ Code of Conduct.

But in 1996, Commission’s communication caused the reaction of ECSA—or really the shipowners of UK, Germany and Denmark… In addition, Italy—most probably—“asked” the “waiving of Cabotage privilege” inside EU-12, and caused the reaction of Greece (1989).

The EU-15 was proud, despite its long delay, for it succeeded—as alleged—in opening-up the European markets, in particular, through its CMP, and gave consumers a wide choice of shipping services, meaning most probably liners. It applied the EC-15 competition rules to all markets… But it admitted that failed to increase either EC-15 seafarers’ employment or to avoid flagging-out⁶⁵ towards a large number of parallel registries! This flagging-out indeed diminished the competition against EU-15 fleet except on costs needed for safety.

In fact, the EU-28 shipowners tried to protect themselves from the competition of non-EU ships and flags, by establishing the parallel registries, where crew costs were lower as well taxation, except for the safety standards. Thus, they could compete their competitors. To this surely decisively contributed the 1974- 1979-1987 shipping crisis!

Today, EU-27 is threatened by a wave of immigrants, amounted in 2018 up to 22m, and increasing after the pause of Afghanistan war; also, by the lack of adequate own energy; and by Russia and its supply of natural gas.

But more serious than the above, EU-27 is threatened by the possibility to fail in decarbonizing EU-27 shipping, and planet, by 2030, and thus no one to be “fit for 55”, or even for 40, as COP26 and MEPC 77 paid no particular attention to the problem. Will EU-27, be still 27, when the problem of climate will crop-up again more urgent and intense? We doubt.

EU-12-15 wanted to make its fleet more competitive, but it did not catch the last train, which was the building cost, covering 50% of total cost! The flag costs of each member-state also ignored, but these were responsible for flagging-out, together with crew cost and taxation.

Poor countries with large shipping are unable to provide any state aid. And rich shipowners benefit their poor countries of birth, no matter if their ships used to fly foreign flags (Onassis; Niarchos and others).

Shipping-the unknown…is the chicken making the golden eggs-needing a simple holistic treatment so that not to kill it. This means to help it to maintain the lowest possible total cost, starting from the building one.

The author declares no conflicts of interest regarding the publication of this paper.

Goulielmos, A. M. (2022). The Initial 40 Years of the EC Maritime Policy, Part I: 1957-1997: Is EU-27 Maritime Industry “Fit for 55”? Modern Economy, 13, 159-185. https://doi.org/10.4236/me.2022.132011