CANADA – Rarely do fares come down but it is even more unusual for a business watchdog to demand that freight rates go up – yet that is precisely the situation which has arisen on the RoRo ferry routes around the coastal inlets and islands of British Columbia this week. British Columbian Ferry Services (BCFS) are a publicly subsidised service which has dozens of routes in an area where water borne carriage is the most important form of personal and commercial transport.
After BCFS introduced a drop trailer service in 2009 competitors like Seaspan Ferries and Van Isle Barge Services Ltd. complained to the Federal Government and an appeal was made to the regulatory body, the B.C. Ferry Commissioner, who launched an independent enquiry using accountants PCW to analyse costs and opening a public debate.
The enquiry decided that BCFS, who previously offered accompanied freight trailer services as well as the usual pedestrian and private motorist carriage, was operating the unaccompanied trailer facility at a loss and, although not generally unfairly competitive, the exemption from tax which the company enjoys and the regulatory framework under which it operates meant it was competing unfairly.
It was decided by the commission that an additional overhead charge should be imposed on dropped trailers to account for the extra charges incurred; a dropped trailer currently incurs the same rate per foot as an accompanied, unlike many ferry services in other countries which have distinct tariffs for dropped trailers and those accompanied by trucks. The new levy will allow for the reduction in size of an unaccompanied trailer and for the extra costs involved in loading and discharging, parking etc.
The new rates will be instituted from the 1st April and there will be a requirement for BCFS to submit traffic details to the Commission for dropped trailers within two months of the end of each quarter so fairness of competition can be assessed. Representatives of BCFS competitors, who have lost business because of the disparity in rates, have expressed satisfaction with the result of the enquiry.
Photo: Courtesy of Van Isle Barge Services. An ocean going barge designed for the ocean carriage of roll-on and roll-off RoRo traffic.
