Workshop Good Practices for Ship Vetting 12 October 2011

Nicole L Maréchal Senior Legal Counsellor & Governance Officer 2

Legal aspects of ship vetting Guidelines The Guidelines are of voluntary nature, not made mandatory by law It is a risk assessment process and risk prevention system, proposed in application of Responsible Care We (lawyers) are also looking into activities including Guidelines aimed at improving Health Safety & Environment to prevent (legal) risks occurrence 3

Legal aspects of ship vetting Guidelines Need to have these Guidelines as any Cefic activities conforming with competition compliance to avoid breaching law but also to have any misunderstanding from competition authorities It is not because you are working within Responsible Care / Product Stewardship / HSE that competition law would not apply → you need to check and to comply 4

EU Competition Law To ensure competition compliance how to proceed: Look at the prohibition of cartels (basically Article 101 TFEU) Also at the Commission Guidance on Horizontal Agreements, including standardization Apply this to the Guidelines 5

6 Does Art 101 (1) apply ? Are the 4 conditions of 101 (3) met ? Infringement - Sanctions such as: Fines (huge) Agreements void & unenforceable Damages Criminal sanctions Any applicable block exemption - Guidelines ? OK No Yes No Yes Cartel prohibition – 101 TFEU

Cartel prohibition May also apply to activities of a trade association In addition to usual cartels (eg decision on price, sharing clients, limiting output) cartel prohibition may also apply to systems organised via HSE guidelines There is a grey zone into which carefulness about activities management is required → pattern your activity on the right way Need to be looked at this from Cefic view point, as well as the company one and along the chain 7

Ship vetting Guidelines - compliance Ship vetting Guidelines – any system alike needs to fulfil the following characteristics: 8 No exclusion of actual or potential competitor Freedom to develop alternative systems Transparency Means to be proportionate to aims Exchange of information to be limited to the minimum System to be open and non-discriminatory

Ship vetting Guidelines - compliance The choice of the logistic service provider is based entirely on the individual decision-making process of each company, which may or may not include criteria/procedure/system developed by the Guidelines It is certainly NOT a collective decision-making process organised by Cefic or chemical companies to collectively de-select logistic service providers 9

Ship vetting Guidelines - compliance It IS NOT a: Certification system to be compared to ISO, or a standardization system A pass/fail system or system to white/black list providers An exclusive system replacing any existing or future systems But it IS a: A means that companies would use to help avoidance of accident based on voluntary participation One of the tools that company may use when choosing their respective logistics provider System to be operated in a non-discriminatory and non- exclusionary manner 10

Thanks your attention I wish you the best for developing and applying your own Ship Vetting system 11