The Minister of Transport, Luis Alberto Heber, has made a series of statements before the Senate Transport Commission which allude to the activities carried out by port operators in the Port of Montevideo which are not accurate, which unfoundedly question the legitimacy of the activities of Montecon S.A. and which justify decrees which in our opinion are illegal and establish a monopoly of port services in the Port of Montevideo in favour of the company TCP.

1. Firstly, it is not true that Montecon's activities in the Port of Montevideo are illegitimate. Montecon was authorised by the State as a port operator in accordance with the Ports Law and its regulatory decree 413/992, as stated in resolutions of the National Ports Administration (ANP) of 2000 and 2003, both approved by the Executive Power. These authorisations allow it to provide transfer services of all kinds of cargo in the Port of Montevideo, particularly containers, using part of its infrastructure, without any exclusivity or privilege, and paying what the State requires for them.

In its current operation, Montecon uses, in addition to its permitted and concessioned areas (for a total of 16,700 m2 ), an area for container operation in storage regime of 32,800 m2 , not 150,000 m2 as mentioned above, which represents only 22% of the total common use areas which are also used in the same regime by other operators and warehouses of the Port of Montevideo. The total of areas used for container storage by Montecon, in its different regimes (storage, permit and concession) represents 6% of the total of the 820,000 m2 that constitute the public area of the Port of Montevideo.

According to the current tariff(link), Montecon pays for the use of this port infrastructure for container storage at a rate of 7.16 USD/m2, not 3 and 6 USD/m2 per month as erroneously stated by the Minister of Transport.

Montecon has paid the ANP more than US$100 million for the use of storage areas, permits, concessions and container transfer fees, amounting in recent years to approximately US$14 million annually. In addition, Montecon has invested more than US$90 million in port infrastructure, equipment and technology and currently employs more than 700 people in its operation, pays salaries of more than US$18 million annually and another US$8 million to its contractors.

In these conditions, within the framework of the free competition regime enshrined in the Ports Law, ratified by the TCP Concession Law and confirmed by the Law for the Defence of Free Competition, Montecon has been freely chosen by the most important shipping companies in the world to operate their vessels in the Port of Montevideo, for which it mobilises approx. 280,000 containers per year (approx. 450,000 TEUs/year) representing 55% of the total container market of the Port of Montevideo.

This is how Montecon has been operating for more than 20 years, during which time no authority has ever questioned the legitimacy of its activities and, on the contrary, it has been allowed to participate in public tenders for storage areas to allow for the better development of the port's activities.

2. The free competition regime in port activity was expressly enshrined in the 1992 Ports Act, ratified by the 2000 TCP Concession Act and confirmed by the 2007 Law on the Defence of Free Competition, as confirmed by the decision of the Commission for the Promotion and Defence of Free Competition No. 16/17 dated 7 March 2017.

The free competition regime in port activities existed at the time when the terminal was put out to tender and awarded to TCP, which declared that it was aware of these regulations and voluntarily submitted to them. A free competition regime does not allow the establishment of a privilege in favour of a competitor, such as the fact that, by decree of authority, shipping lines are forced to serve their vessels as a priority in TCP's terminal and TCP is granted exclusivity in the movement of containers in the port.

It is therefore inadmissible to interpret Decree 183/994, an internal regulation of the ANP, issued when it was the sole operator of all the areas of the Port of Montevideo and which is now intended to be given a general scope contrary to the express provisions of the Ports Law, ratified by the Law of the TCP Concession and confirmed by the Law for the Defence of Free Competition.

Today, Decrees 114/021 and 115/021 seek to uphold this illegal interpretation and disregard the free competition regime enshrined in the Ports Law, ratified by the TCP Concession Law and confirmed by the Law for the Defence of Free Competition, establishing privileges in favour of the TCP company. It is even more delicate that in this way the State itself, which through ANP holds a stake in TCP, is artificially benefiting.

Montecon does not agree with this illegal interpretation, has claimed that these decrees are illegal and therefore does not agree with the Transport Minister's defence of them before the Senate Transport Committee.

Montecon only asks to be allowed to compete without privileges.

3. The Minister of Transport intends to justify the de facto monopoly which he is illegally trying to establish in favour of TCP, by invoking out of context requests from the company Ultramar, a partner of Montecon together with Atco Canada, to the Chilean authorities who at the time limited the participation of this company in the tender for a second terminal in the Port of Valparaiso. It is important to clarify that what Ultramar requested on that occasion was precisely to be allowed to compete in the tender for the second terminal under equal conditions, where they wanted to limit its participation, despite the existence of strong competition in the port market of the Fifth Region of Chile, where there were 3 other players competing aggressively for the transfer of cargo from that central area of the country.

In this regard, the Minister of Transport omits to point out that the Santiago area has two ports with 4 container terminals, all equidistant from this important centre of consumption, of which two are concession terminals in San Antonio and the other two are concession terminals in Valparaiso. It is not correct for the Minister of Transport to cite Valparaiso as the only port in the central zone of Chile, even less to justify the monopoly that is being established in favour of TCP, which would be the only terminal authorised to transfer containers in the port of Montevideo.

Ultramar is a company that fully subscribes to the principles of free enterprise, free markets and free competition, always acts in a manner consistent with these principles and this culture is applicable to all the companies in which it is involved, including in this case especially Montecon.

In this respect, we only ask you to avoid personal disqualifications, which are absolutely unfounded and not in keeping with the truth.

4. The matter under discussion is that the recently published Executive Decrees N°114 and 115/021 establish a system of privileges for the operation of containers in the Port of Montevideo in favour of the company TCP, in response to which Montecon claims that it does not comply with the regime of free competition enshrined in the Ports Law, the Law on the Concession of TCP, the Law on the Defence of Free Competition and the Law on the Protection of Free Competition, Montecon claims that a de facto monopoly is established in favour of this company without a law enabling it and that, in these terms, Montecon will not be able to continue operating and its right to develop economic activities, its right to compete freely, the right to work of its people and the equitable treatment that the investment of its shareholders Atco Canada and Ultramar Chile deserves under the protection of the International Treaties in force between the two countries and the Republic of Uruguay will be violated.

5. We wish to state publicly that Montecon is no longer asking to be allowed to continue providing port services to Uruguay's foreign trade in a regime of free competition as currently enshrined in the law.

Montevideo, 11 May 2021

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