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04 October 2012
On May 22 2012 the president of the Competition Council ordered Port Real Estate, a warehouse operator in the port of Antwerp, to maintain minimum load-out rates for robusta coffee traded on the NYSE Liffe Exchange in London. The interim order follows a complaint and a request for interim measures lodged by Armajaro Trading Limited, a UK-based trader in agricultural goods, on the basis of an alleged abuse of dominant position by Port Real Estate.
A buyer of robusta coffee beans on the NYSE Liffe Exchange does not know in advance where the coffee that it has purchased is stored. According to the preliminary investigation in this case, there is a considerable possibility that it is stored in a warehouse in Antwerp belonging to Port Real Estate, given the company's high market share. Hence, a purchaser of Liffe-certified robusta coffee that wishes to sell or move loads of its coffee to another warehouse (eg, one with lower rates) is often dependent on the load-out pace managed by Port Real Estate.
In its complaint, Armajaro argued that Port Real Estate abused its dominant position by executing orders to load out the Liffe-certified coffee from its warehouses at a deliberately slow pace, allowing it to obtain more rent from its warehouses. Armajaro also alleged that because of this abusive behaviour, it sometimes failed to deliver to its clients on schedule.
The president of the council considered that the situation was urgent and that provisional measures were necessary in view of the prima facie violation of both the Belgian and EU provisions prohibiting abuse of dominant position. Accordingly, the president ordered Port Real Estate to maintain an average load-out rate of Liffe-certified robusta coffee of at least 500 tons per working day, to be measured at the end of every month. These minimum amounts of loading must be divided equally among all customers that request Port Real Estate to load Liffe-certified robusta coffee out of its warehouses.
The interim measures will be in force at least until June 30 2013 - the date by which the council expects to complete the investigation of Armajaro's complaint.
According to Reuters, NYSE Liffe has agreed to regulate warehouse load-out rates for certified robusta coffee with effect from September 2012.
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