FMC Denies Two Shippers' Associations' Petitions for Reconsideration of NSA Final Rule
The Federal Maritime Commission (FMC) has issued an order denying the petitions filed by the International Shippers' Association (ISA) and the American Institute for Shippers' Associations (AISA) that sought reconsideration of the FMC's final rule on non-vessel operating common carrier (NVOCC) Service Arrangements (NSAs), and asked the FMC to stay the effectiveness of the final rule.
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(The FMC's final rule, which went into effect on January 19, 2005, exempts NVOCCs from the tariff publication requirements of the Shipping Act of 1984, conditioned upon the filing of confidential NSAs.)
ISA & AISA Petitions Contend that FMC Failed to Consider Their Arguments, Etc.
According to the FMC, the ISA and AISA contend that in the NSA rulemaking process, the FMC failed to consider their arguments; acted beyond its statutory authority in enacting the new rule; failed to adequately analyze the rule's potential effects on competition between large NVOCCs and smaller NVOCCs; and improperly regulated the membership of shippers' associations.
ISA & AISA Had Objected to Definition of "NSA Shipper," Etc.
The FMC states that both the ISA and AISA participated in the NSA rulemaking by filing comments, and both objected to the FMC's determination not to allow NVOCCs, in their capacity as shippers, to enter into NSAs. They disagreed with the FMC's decision to define "NSA shipper" as excluding "NVOCCs or shippers' associations whose membership includes NVOCCs."
(According to the FMC's final rule, "NSA shipper means a cargo owner, the person for whose account the ocean transportation is provided, the person to whom delivery is to be made, or a shippers' association. The term does not include NVOCCs or shippers' associations whose membership includes NVOCCs.")
FMC Rejects Both Petitions Pursuant to Rule 261, Etc.
The FMC states that it summarily rejects both petitions, pursuant to 49 CFR 502.261(a) ("Rule 261"). Furthermore, the FMC denies the requests for waiver under 49 CFR 502.10 ("Rule 10"), and denies the requests for stay as moot.
ISA's petition was filed on January 7, 2005, and AISA's petition was filed on January 11, 2005. The 15-day comment periods for both petitions extended beyond the scheduled effective date of the final rule (i.e., January 19, 2005); however, neither petitioner requested a shorter comment period for consideration of its request for a stay.
(See ITT's Online Archives or 01/21/05 news, 05012110, for BP summary on the NSA final rule's going into effect on January 19, 2005, which includes links to other related BP summaries.)
FMC order (D/N 04-12, served 02/08/05) available http://www.fmc.gov/Dockets/04-12%20reconsideration%20order%202-8-05.htmN_1_
BP Note
In mid-January 2005, the ISA and AISA filed petitions with the U.S. Court of Appeals for the District of Columbia Circuit (Court) to review the FMC's decision to restrict shippers' associations from entering NSAs. However, ISA and AISA subsequently withdrew their petitions from the Court, as the FMC had not yet ruled on the above-described petitions.
Now that the FMC has denied the ISA and AISA petitions, the ISA and AISA have the option to re-file their petitions with the Court.