The National Commission for Markets and Competition (CNMC) has issued a report against the decree regulating the rental of pleasure boats in the Balearic Islands, considering that it introduces restrictions that limit competition, eliminate legal business models and make the service more expensive for the user.
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Point by point, how will be the new decree for nautical charters
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The injunction, dated October 28, was sent to the Consell de Govern as a preliminary step to possible legal action.
The CNMC report points out as particularly serious the prohibition of the partial rental of boats, i.e., by individual seats or tickets.
In the opinion of the organization, this restriction suppresses a business model previously existing in the Balearic Islands and common in other areas of the Spanish coast, limiting both the exercise of economic activity and the freedom of choice of consumers.
In addition, it considers that the measure will force users to pay more for the same service by preventing the sharing of the cost of the boat.
It also qualifies as excessive the obligation to have prior authorization for mooring, buoy or embarkation and disembarkation point, a condition that did not appear in the 2017 decree.
According to the CNMC, this new requirement hinders the activity of companies operating from outside the archipelago and adds bureaucracy, as they have to prove it with documents, carry it on board and register it in the corresponding registry.
No positive impact on the environment and safety
In its analysis, the CNMC stresses that neither the environment nor maritime safety are strengthened by the ban on the sale of seats.
The report stresses that aspects such as anchoring on posidonia, waste management or emissions do not depend on the mode of contracting, and adds that preventing passengers from grouping together could disperse demand and increase the number of vessels and departures, with an impact contrary to the environmental objective.
With regard to safety, the report warns of a mistaken assimilation between the sale of seats and the maritime transport of passengers, and recalls that this equivalence “has no legal basis”, since the marketing formula does not alter the leisure nature of the service .
For its part, the Balearic Executive defends the decree on the grounds that it merely applies the Maritime Navigation Law of 2014, which distinguishes nautical leasing from passenger transport, a differentiation supported by a report from the Lawyer’s Office of the Autonomous Community.
According to the Government, state regulations prohibit the charter contract to include passenger transport, so the Balearic measure complies with the law, although it differs from what is allowed in other communities.
Competition barriers
The CNMC report also denounces discrimination between Spanish and foreign nautical schools, as the decree exempts national schools from complying with certain restrictions, such as marketing by places, while forcing foreign schools to comply with all of them, without there being, according to the agency, a clear justification for such unequal treatment.
It also criticizes the limitations imposed on non-EU flagged vessels over 14 meters, which must demonstrate that there are no equivalent alternatives in the EU to operate.
This requirement, described as a “flag waiver”, is considered a disproportionate burden that is difficult to meet and reduces supply in the market.
Rejection of the temporary change of use ban
Another of the objections of Competition is directed to the Balearic ban on charter with temporary change of use of private boats to commercial: the possibility of tourist rental of private boats for three months a year.
This practice, regulated at state level since July with requirements such as inspections, insurance and management by an authorized company, is banned in the Balearic Islands.
The CNMC considers that this prohibition limits the ability of entrepreneurs to expand the fleet in high season, affecting supply and prices, and concludes that the Balearic regulation is not justified by the risks it seeks to avoid.
In any case, the agency recognizes that only 17 vessels in the whole country have requested this change of use, which, in its opinion, does not allow to affirm that there has been a significant increase in the fleet, nor that competition has improved thanks to this figure.
While admitting that the Government’s objective could be to reduce the pressure on the nautical industry during the high season, the CNMC suggests looking for measures less harmful to economic activity than the current restrictions.
Criticism of bureaucracy and administrative burden
The document also questions the obligation to renew annually the responsible declaration that enables the activity, as well as the payment of the corresponding fee, even when there has been no change in the conditions of the service.
The CNMC considers that there is no overriding reason of general interest that justifies this annual renewal, and recalls that the operator is already obliged to maintain the requirements and that the administration has the power to impose penalties in the event of non-compliance.
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