Deferred rebate

A deferred rebate is a loyalty discount used by liner conferences to lock shippers into conference carriers. The rebate, commonly 10 percent of freight paid over a shipment period of three to six months, is held back and paid only after a further deferred period of about six months, and only if the shipper used no non-conference ship in either window. The withheld money makes defection costly, which is how conferences kept exclusive patronage. The practice is prohibited for common carriers under the US Shipping Act of 1984, and EU liner conference immunity was repealed in 2008.