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The US Federal Maritime Commission has acted over suspicions that an information-sharing arrangement between ocean carriers and west coast terminal operators could lead to complaints on competition issues.
The FMC has issued a Section 15 order on signatories to the Pacific Ports Operational Improvements Agreement (PPOIA), requiring them to provide additional information on the agreement, and ordering “common carriers and their employees and agents to report on matters germane to the business of the carrier”.
The PPOIA was originally filed with the FMC, the US maritime regulator, on 3 March and came into effect on 17 April. It allows carriers and marine terminal operators to discuss and exchange information “to reduce port congestion and enhance efficiency on the west coast”.
It followed months of crippling congestion at the country’s most important container gateways that paralysed supply chains.
However, at the weekend, FMC commissioner William Doyle released a statement in which he said that a series of FMC questions to the PPOIA parties had “not elicited an adequate response”.
He said: “As a commissioner I am interested in information including, but not limited to, service agreements between the vessel operating common carriers and the marine terminal operators, as well as information related to chassis operations.”
He added that failure to respond properly to FMC enquiries meant that the PPOIA signatories were “impeding” the commission’s ability to police the agreement.
“Prior to the agreement going into effect, I reviewed the comments submitted by the public and met repeatedly with counsel for the parties. Counsel was cooperative in answering my questions and they amended certain terms and conditions in the agreement to help alleviate my concerns. I also met with private sector stakeholders and spoke with several west coast port authorities.
“Importantly, I also listened to those who expressed concerns about the agreement.
“As a result of these discussions, the parties agreed to narrow the scope of the agreement to minimise possible anticompetitive effects, while still maintaining a cooperative effort to reduce port congestion,” Mr Doyle said.
The FMC has also sent a request for additional information to several companies that are now resulting in a delay to the implementation of an amendment that would add the additional parties to the PPOIA agreement by stopping the 45-day clock.
The companies are MSC, China Shipping and Ports America North Harbour.
Mr Doyle added: “Congestion and inefficiency in our ports do not square with a fair, efficient and reliable international ocean transportation system. I applaud all efforts to innovate and speed the flow of goods in and out of the United States. But all such efforts must also protect importers, exporters and the American consumer.”
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Comment on this article
David TubmanJuly 14, 2015 at 2:21 pm
Mr. Van Marle,
A quick correction to your penultimate paragraph:
the FMC did not suspend the application by 16 shipping lines with its RFAI.
The Commission unanimously voted to send the parties a Request for Additional Information (RFAI), meaning a delay the implementation of an amendment that would add additional parties to the PPOIA agreement by stopping the 45-day clock.
Alex LennaneJuly 14, 2015 at 2:36 pm
Dear Mr Tubman,
Thank you for your correction. We will update the story as soon as possible.
David TubmanJuly 14, 2015 at 2:40 pm
The three additional parties are MSC Mediterranean Shipping Company, China Shipping Container Lines, and Ports America Outer Harbor Terminal.