International trade continues to have major benefits for Americans despite becoming an increasingly divisive issue, Federal Maritime Commission Commissioner Mario Cordero said during a March 20 speech for the International Shipping and Offshore Forum (here). "Many in the international trade community have grave concerns with not only the domestic debate questioning the benefits of international trade, but also the global debate," he said. "Let me make clear, international trade is a two-way street. Exports are as important as imports. True, there may be an imbalance on the export-import equation -- and I am a supporter of maximizing export opportunities -- yet, at the end of the day, the success of our U.S. exporters is dependent on a global consumer.”

Acting Chairman of the Federal Maritime Commission Michael Khouri named FMC Managing Director Karen Gregory the commission’s regulatory reform officer, the FMC said in a news release (here). Gregory will head FMC’s Regulatory Reform Task Force, which “will work to identify burdensome, unnecessary, and outdated directives and recommend how they should be remedied.” An executive order issued by President Donald Trump on Feb. 24 requires each agency to set up a regulatory reform task force.

The Federal Maritime Commission approved regulatory updates to its rules for service contracts and non-vessel operating common carrier service arrangements, the agency said in a March 6 news release (here). The final rule will allow for "filing of sequential service contract amendments with the FMC within 30 days of the effective date of an agreement between shipper and carrier" and give additional time to correct technical data transmission errors, among other things, it said. "The Commission examined regulatory requirements for service contracts and NVOCC Service Arrangements in light of current commercial practice and has eliminated a number of burdensome regulatory requirements that served as obstacles to efficient ocean transportation arrangements, added unnecessary transactional costs, and served no regulatory purpose," Acting FMC Chairman Michael Khouri said. "Today’s action is consistent with recent executive orders highlighting the benefits of reducing unnecessary and costly regulations. I am committed to continuing to identify rules that are outdated, or impede the efficient operation of business, and eliminating them whenever possible." The text of the final rule will be posted soon, the FMC said.

A new clause in NYK Line's bill of lading terms and conditions involving the verified gross mass (VGM) amendments to the Safety of Life at Sea (SOLAS) seems "inappropriate and contravenes" U.S. law, the National Customs Brokers & Forwarders Association of America said in a Feb. 3 filing with the Federal Maritime Commission (here). The NCBFAA specifically objects to the addition in clause 15 of the terms (here) that say the shipper is responsible for weighing costs and must provide the VGM for each container by a deadline established by a terminal or NYK. The clause also says NYK can reject a container "at its sole option" if no VGM is provided by the deadline and that the carrier won't be liable for any costs related to a rejection. The controversial VGM requirements went into effect last year (see 1607010041), though there's been little public controversy around the updated SOLAS since.

The Federal Maritime Commission reached settlements totaling $962,500 in civil penalties with a non-vessel operating common carrier (NVOCC) and nine ocean transportation intermediaries, it said Dec. 15 (here). "The parties settled and agreed to penalties, but did not admit to violations of the Shipping Act or Commission regulations," it said. Of that total, $300,000 in civil penalties will be assessed against Honour Lane Shipping Limited, Global Ocean Agency Lines, and World Express Shipping, Transportation and Forwarding Services over allegations of illegal collaboration between the three companies, it said. Also penalized were RS Logistics, Hundai Glovis, World Wild Container Transfer, U-Ocean USA, United Transport Tankcontainers and LF Logistics, the FMC said.

The proposed THE Alliance will become effective Dec. 19 as a result of the Federal Maritime Commission's completed review, the FMC said in news release (here). "The Commission voted to allow the agreement to become effective following a period of substantive and constructive discussion with the parties," it said. The agency will allow the alliance to proceed despite some objections submitted by the Justice Department over anti-competitive concerns (see 1611280024). "I am very cognizant of the concerns industry stakeholders had regarding provisions in this agreement, particularly those related to information sharing and joint procurement," FMC Chairman Mario Cordero said. "This office will continue to carefully focus on the impacts of the carrier alliance restructuring that is taking place in the shipping industry. Considerable review and analysis goes into assessing a final agreement before it is allowed to go into force. Five container shipping companies -- Hapag-Lloyd, K Line, MOL, NYK and Yang Ming -- make up THE Alliance. "Under the terms of the agreement, THE Alliance members are permitted to share vessels, charter and exchange space on each other’s ships, and enter into cooperative working arrangements," the FMC said. The DOJ didn't comment.

The Federal Maritime Commission should seek additional information about the recently filed THE Alliance Agreement due to the possibility of anticompetitive issues, the Justice Department's Antitrust Division said in comments to the FMC (here). The FMC published a notice about the agreement earlier this month (here). The DOJ said its objections to the THE Alliance are similar to the concerns it submitted about the OCEAN Alliance, which the DOJ unsuccessfully pushed the FMC to prevent (see 1611080022). "THE Alliance Agreement raises a number of significant competitive concerns, particularly as it comes on the heels of the recently approved OCEAN Alliance," the DOJ said. "The creation of these two new alliances will result in a significant increase in concentration in the industry as the existing four major shipping alliances are replaced by only three." Parties to the agreement would be "Hapag-Lloyd AG and Hapag-Lloyd USA LLC (acting as one party); Kawasaki Kisen Kaisha, Ltd.; Mitsui O.S.K. Lines, Ltd.; Nippon Yusen Kaisha; and Yang Ming Marine Transport Corp.," according to the FMC notice. "As you are aware, once an agreement among ocean carriers is filed with the FMC and becomes effective, conduct covered in the agreement could enjoy immunity from the antitrust laws," the DOJ said in the comments. "Where, as here, an agreement contemplates extensive cooperation among members, extreme caution is warranted. We strongly urge the Commission to seek additional information from the carriers and to conduct a rigorous review of the record." A lawyer for the THE Alliance didn't comment.

Almost all the 21 “selected industry groups” interviewed by the Government Accountability Office “said that shippers in their respective industries using major West Coast ports were affected by recent port disruptions,” such as the labor impasse that virtually shut down 29 West Coast ports in 2014 and 2015 (see 1502230002), an Oct. 31 GAO report said (here). Higher costs, lower revenue and shipment delays were the “main types of short- and long-term financial and business impacts” the industry groups said their members experienced from the 2014 and 2015 port disruption, GAO said. Almost all cited “some form of increased costs, and several industry groups experienced multiple types of increased costs,” the report said. “Some of the impacts were short-term -- such as increased costs or shipment delays -- while other impacts were of longer-term duration, such as the loss of sales, customers, or market share.”

The Federal Maritime Commission gave its approval to the OCEAN Alliance, which will go into effect Oct. 24, the agency said (here). The alliance includes COSCO Shipping, CMA CGM, Evergreen Marine, and Orient Overseas Container Line Limited. The members will now be allowed "to share vessels; charter and exchange space on each other’s ships; and, enter into cooperative working arrangements in international trade lanes between the United States and ports in Asia, Northern Europe, the Mediterranean, the Middle East, Canada, Central America, and the Caribbean," the FMC said. "The Commission worked very hard to balance the needs of not only the OCEAN Alliance applicants, but all other parties involved in the intermodal supply chain, with the ultimate goal of safeguarding competition in international oceanborne common carriage, with the American shipping public foremost in mind," FMC Chairman Mario Cordero said. "The Agreement going into force represents a consensus of what will allow OCEAN Alliance carriers to achieve efficiencies without harming the marketplace."

The Federal Maritime Commission increased its fees for filing complaints, petitions, agreements and other services, the agency said (here). Other fees were reduced or eliminated, it said. The changes became effective Oct. 1.