Trade Groups Suggest "Common Principles" to Guide FMC's Review of Recent NVOCC Service Contract, Tariff Petitions

The National Customs Brokers and Forwarders Association of America, Inc. (NCBFAA), the National Industrial Transportation (NIT) League, and the Transportation Intermediaries Association (TIA) have submitted to the Federal Maritime Commission (FMC) joint additional comments in response to the FMC's reopening of the comment period on five petitions requesting that some or all non-vessel operating common carriers (NVOCCs) be granted, variously, the ability to enter into confidentially negotiated service contracts with their customers, an exemption from establishing and publishing rate tariffs for ocean transportation, etc.

(The five petitions were filed by United Parcel Service, Inc. (UPS); NCBFAA; Ocean World Lines, Inc. (OWL); BAX Global Inc. (BAX); and C.H. Robinson Worldwide Inc. (Robinson). See ITT's Online Archives or 11/17/03 news, 03111710, for BP summary of FMC's notice on the extension of the comment period for these petitions.)

Trade Groups List 7 "Common Principles"

According to the joint comments, the following are the "common principles" which the trade groups believe should guide the FMC in adjudicating these proceedings:

• FMC has authority under Section 16 of the 1984 Shipping Act, as amended by the Ocean Shipping Reform Act of 1998 (OSRA), to provide greater pricing flexibility and/or reduce regulatory burdens for NVOCCs.
• FMC's exemption authority was liberalized under OSRA and should be exercised unless it would be detrimental.
• Granting exemptions that broadly permit confidential contracting between NVOCCs and their customers and reducing tariff publication burdens would have a pro-competitive impact.
• FMC should initiate a rulemaking to determine how to apply exemption authority to allow confidential service contracts between NVOCCs and customers. In addition, the groups state that the FMC should permit all qualified NVOCCs to have service contracting authority and should consider whether service contracts between NVOCCs and shippers should be subject to all of the existing rules and requirements applicable to vessel operating common carrier (VOCC) service contracts.
• NVOCCs should have the same opportunity as VOCCs to offer contracts to their customers.
• NVOCC administrative costs of publishing tariffs exceed any consumer benefits.
• Changes in shipping industry support regulatory relief for NVOCCs.

(The trade groups also state thatthey will be separately submitting additional comments in response to the FMC's reopening of the comment period on the five NVOCC-related petitions.)

NCBFAA, NIT League, and TIA comments (dated 01/12/04) available by email or fax by emailing staff@brokerpower.com.