[031220.EN.SEA] US Federal Maritime Commission Deepens Probe Into Shipping Alliances

 

THE US Federal Maritime Commission (FMC) has demanded three global carrier alliances provide trade data monthly that is usually supplied quarterly, reports London's Container Management.

"The time has come to resolve the most serious impediments to port performance. I have all enforcement options at my disposal to address the crisis that exists in our major port gateways," said Commissioner Rebecca Dye.

"Removing the obstacles to port performance allows ocean carriers, ports and marine terminals, drayage truckers, American importers and exporters, and every other business engaged in freight delivery to grow and prosper," she said.

The FMC has already commenced probes into alliance practices in Long Beach, Los Angeles, New York and New Jersey after shippers complained of the lack container availability, soaring transpacific rates and plunging service quality.

Said FMC chairman Michael Khouri: "If necessary, the FMC will go to federal court to seek an injunction to enjoin further operation of the alliance agreement.

"If we detect any indication of carrier behaviour that may violate the Shipping Act's section 6(g) competition standard, we will immediately seek to address these concerns with direct carrier discussions," he said.

The Commission's Bureau of Trade Analysis (BTA) has determined that given recent fluctuations in the markets, it needs to receive key trade data directly from alliance carriers on a more frequent basis.

This will help it to better position staff economists to timely evaluate changes in the transpacific and transatlantic trades and report findings to the commission.

The BTA has traditionally relied on a combination of individual vessel operator confidentiallyprovided data and information from commercially available industry data to monitor and analysecontainer carrier freight rates and service market trends.

The commission noted that the three major carrier alliances - 2M, the Ocean Alliance and THEAlliance - are the top priority and receive highest scrutiny.

These three agreements have the greatest potential to cause or facilitate adverse market effects based on the agreement's authority and geographic scope in combination with underlying market conditions, it pointed out.

The FMC monitors key economic indicators and changes to underlying market conditions for all global alliance agreements to detect any joint activity by agreement members that might raise and maintain freight rates above competitive levels, or unreasonably decrease services.

Last week, the FMC approved a supplemental order to investigate ocean carriers operating in alliances and calling the Port of Long Beach, the Port of Los Angeles, or the Port of New York and New Jersey.

The expanded commission investigation will seek to determine if the policies and practices of those shipping companies related to detention and demurrage, container return, and container availabilityfor US export cargoes violate 46 USC 41102(c).

Source : HKSG.