Problem

Restrictive transnational corporation control of bulk shipping

Nature:
Where transnational corporations (TNCs) are involved with the extraction of minerals, food growing, and the use or conversion of other natural commodities, it has been in their interest to own or control the means of transporting these high bulk products in order to reduce costs. In bulk trade shipping most indicators point to a high degree of control by TNCs. They exercise their control partly because they are involved in vertically-integrated operations, partly because they have participation agreements or long-term contracts with supplier countries which give them the right to control transport, and in some trades because they operate in a buyer's market and can insist on buying on FOB terms.
Incidence:
Shipping company affiliates are used by transnational oil companies for the purpose of diverting profits to tax haven countries by means of transfer prices. The affiliation of shipping companies of developed countries to buyers, an aspect of the control being exercised by transnationals and large trading organizations and their integrated operations, is sufficient to create a situation in which developing countries' fleets are effectively excluded from participation. UNCTAD reports indicate that dry bulk cargo movements are also dominated by transnationals using the instrument of chartering, as 'markets', 'exchanges' or 'parties'.
Claim:
Bulk cargoes appear to a large extent to be captive cargoes of TNCs to the disadvantage of exporting and importing developing countries.
Related Problems:
Restrictive shipping practices
Problem Type:
E: Emanations of other problems
Date of last update
01.01.2000 – 00:00 CET