Abstract
The European Union has strived for deregulation in the road transport sector on the grounds of improved quality and reduced freight rates on the services offered, protecting the public interest and improving transport services. Extensive research has investigated the impact of road transport sector deregulation on freight rates, security and environment among others. This paper adds to the literature by analysing the impact of the road transport deregulation on the short sea shipping sector. The findings have two important implications for the formation of transport policy: a) regulatory reforms and the provision of stimuli to road freight transport companies have negative effects on short sea shipping; b) environmental benefits can be gained if policies supporting short sea shipping are complemented by focusing on reducing road freight transport externalities, including reducing truck movements based on load factors/empty runs and decreasing the number of trucks.
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