The EU "cabotage" rules (regulation 3577/92) ensure that maritime transport services within a Member State, i.e. purely national connections, can be offered by companies of other Member States. The EU rules take into account the issue of public service obligations, in view of ensuring that islands and far distant maritime regions have adequate connections with the mainland territories.
Freedom to provide services within the Member States (ocean trade)
Depending on the kind of transport service, matters relating to manning are the responsibility either of the Member State of registration or of the Member State in which the cabotage service is performed. Member States may make the right to provide transport services subject to public service obligations in the interests of maintaining adequate cabotage services between the mainland and its islands and between the islands themselves. Shipowners providing maritime transport services may do so temporarily in the Member State in which the transport services operate on the same terms as those applied by the Member State in question to its own nationals.
Maritime cabotage was liberalized on 1 January 1993. In the case of France, Italy, Greece, Portugal and Spain mainland cabotage was gradually liberalized according to a specific timetable for each type of transport service. Mainland-island and inter-island cabotage for these countries was liberalized in 1999. This exemption was prolonged until 2004 for scheduled passenger and lighter services and services involving vessels of less than 650 gross tonnage in the case of Greece.