Regulation (EU) 2017/352 and technical nautical services: who controls the controller?

Regulation (EU) 2017/352, establishing a framework for the provision of port services and common rules on the financial transparency of ports[1], is today a fundamental regulatory text in our industry. A regulatory text - it should be reminded - of general scope, mandatory in all its elements and, above all, directly applicable in the legal systems of EU Member States (in other words: as if it were a “national” law of said Member States).

There is, however, one issue in respect of which Regulation (EU) 2017/352 requires - in order to be properly implemented - an “action” by the Member States. Indeed, according to Article 16 of the Regulation in question, “Each Member State shall ensure that an effective procedure is in place to handle complaints arising from the application of this Regulation for its maritime ports covered by this Regulation”.

It should be noted that – still pursuant to the above-mentioned Article 16 of the Regulation at issue – the handling of complaints should be carried out “in a manner which avoids conflicts of interest and which is functionally independent of any managing body of the port or providers of port services”. To this end, Member States shall ensure that there is “effective functional separation between the handling of complaints, on the one hand, and the ownership and management of ports, provision of port services and port use, on the other hand”.

So, in practical terms, Member States are responsible for defining an effective procedure for handling complaints arising from the application of Regulation (EU) 2017/352, as well as – of course – for designating an independent authority in charge of handling such complaints.

In a previous article of our Shipping and Transport Bulletin[2] we pointed out that – in March 2021 – our Country had not yet defined an effective procedure for handling the above-mentioned complaints, nor determined the authority responsible, in practice, to handle them.

Hence, we pointed out the risk that Italy might incur an infringement procedure. In fact, the risk became real when the Commission - in June 2021 - actually sent Italy a formal notice of default for failing, de facto, to define the procedure and designate the authority mentioned above[3].

This topic is back on the agenda today because Italy has “woken up”, but with a decision that raises some questions.

Indeed, as one can see from the website of the European Commission that “collects” the notifications in relation to the application of Articles 16 and 17 of Regulation (EU) 2017/352 by Member States, Italy has reportedly opted for a separation of competences between two distinct authorities.

To come straight to the point, Italy reportedly designated the Transport Regulation Authority (Autorità di Regolazione dei Trasporti - “ART”) as the competent (and indeed already operating) authority for handling all complaints arising from the application of Regulation (EU) 2017/352, but with one significant exception represented by the area of technical-nautical services (towage, pilotage and mooring).

Italy justified (rectius: motivated) this decision on the basis of the “clear connections with safety of navigation” that the said services supposedly have (and indeed do have), connections such as to impose that they be subject “to regulation and supervision by State bodies”.

For this reason, Italy has decided to set up within the Ministry of Infrastructure and Sustainable Mobility (“MIMS”) “a specific independent structure with specific cross-sectoral supervisory and control tasks which may, with reference to the above-mentioned technical nautical services, perform the functions of competent authority for dealing with complaints arising from the application of the Regulation while ensuring, at the same time, the requirements of functional independence both from other ministerial structures and from the managing bodies of the port and from the providers of port services”.

Given that, in the end, the procedures for issuing concessions and the procedures for revising the fees for technical nautical services are the responsibility of MIMS, the question arises: will a structure set up within the MIMS have the necessary independence to handle complaints which – let’s think first and foremost in terms of fees - may arise from decisions ratified by the MIMS itself?

We apologise to our readers, but - to simplify as much as possible - the scenario would be that an operator wishing to challenge a fee approved by the MIMS would have to submit its complaint to the MIMS itself.

On the one hand, we have no doubt that the structure envisaged by the MIMS will be actually equipped with everything necessary to ensure its complete autonomy, but on the other hand we could understand possible concerns - in particular – on the part of users of technical nautical services, interested in having an authority fully in the position, if the conditions are met, to protect their interests and thus to intervene, for example, in the event of application of fees that are not deemed “justified”.

Moreover, some doubts may have already been expressed by the ART itself[4], which - by virtue of its clear role as an independent authority - was probably expecting to be designated as the competent authority pursuant to Article 16 of Regulation (EU) 2017/352 for all possible complaints arising from the application of said legislation, with no exceptions whatsoever (and in particular without the exclusion of a crucial area such as that of technical nautical services) [5].

It is not for us to make judgments, and anyway it is first necessary to understand how this independent structure will be organized in practice. What is certain is - on the one hand - the fundamental importance of the provisions of Regulation (EU) 2017/352 and - on the other hand - the consequent need to ensure that operators (rectius: users of port services) are given the chance to see to see the rules of the Regulation fully applied.

This article is for information purposes only and is not, and cannot be intended as, a professional opinion on the topics dealt with. For further information please contact Simone Gaggero.

[1] For an overview of Regulation (EU) 2017/352, please find below the links to some of the previous articles in our Shipping&Transport Bulletin: “Regulation (EU) 2017/352 on port services and financial transparency: provision of port services (first part)” (December-January 2019); “EU Regulation 2017/352 on port services and financial transparency: ”limitations” to the number of providers of port services and public service obligations (second part)” (February-March 2019); “ Regulation (EU) 2017/352 establishing a framework for the provision of port services and common rules on the financial transparency of ports: employees’ rights, financial transparency and autonomy of port management bodies” (April-May 2019).

[2] “Regulation (EU) 2017/352 and non-identification of complaint-handling authority” (January-March 2021).

[3] To be precise, the formal notice of default - also sent to Croatia and Slovenia - refers to the failure to notify to the European Commission the designated authority.

[4] At the presentation of ART’s annual report to the Chamber of Deputies, the President of ART apparently wondered whether the assignment of responsibility for technical nautical services to the “independent structure” to be set up within MIMS could be considered “compatible with the aim of the Regulation to assign to an independent body the task of receiving complaints on the implementation of the contents of the Regulation itself by the competent bodies and of imposing possible sanctions”. Obviously, attention immediately falls on the adjective “independent”.

[5] Moreover, today this area is going through an important phase, with the launch of new tenders for the issue of concessions for port towage services.