Federal Maritime Commission (FMC) Chairman Mario Cordero announced that the Commission has concluded its review of the proposed OCEAN Alliance, FMC Agreement No. 012426, allowing it to become effective on October 24, 2016. This announcement follows an exhaustive review process by the Commission that thoroughly examined all aspects of this agreement between COSCO Container Lines Co., Ltd., CMA CGM S.A., Evergreen Marine Corporation, and Orient Overseas Container Line (OOCL) to assure that competition in the ocean transportation industry would not suffer. The review process by FMC included a review of additional information from the agreement parties, which delayed the agreement’s initial effective date by two months.

The OCEAN Alliance members, COSCO, CMA CGM, Evergreen, and OOCL, are now permitted 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 agreement authorizes its four members to share up to 220 vessels with a maximum capacity of 21,000 TEUs per vessel, but it does not authorize the members to exchange any information on freight rates, tariffs, service contracts, customer lists, or marketing plans – all those will remain completely separate.

In a published statement, FMC Chairman Cordero 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 ocean borne common carriage, with the American shipping public foremost in mind. The Agreement going into force represents a consensus of what will allow OCEAN Alliance carriers to achieve efficiencies without harming the marketplace.”

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The Federal Maritime Commission (FMC) continues to closely monitor the status of Hanjin Shipping Company, whose recent bankruptcy has caused widespread disruptions to the supply chains of many cargo owners. FMC staff briefed the Commissioners on the latest developments in a closed Commission meeting on October 19, 2016 and noted Hanjin’s cessation of operations has impacted U.S.-based terminal operators, beneficial cargo owners (BCO’s), truckers, and many others in the supply chain. The U.S. Bankruptcy Court for the District of New Jersey is overseeing how Hanjin unwinds its operations domestically.

To assist cargo owners, ocean transportation intermediaries, and other impacted parties the FMC has created a web page named Hanjin Shipping Bankruptcy and Disruption that provides useful links for shipment tracking, contact numbers, and related information including tips for Hanjin customers. These provide guidance on how to work directly with marine terminal operators (MTOs) to secure the release of cargo. The FMC has limited information about terminal charges in this situation because they were negotiated contractually between Hanjin and MTOs. To contact the FMC for assistance with Hanjin bankruptcy related issues please visit http://www.fmc.gov/NR16-18/ and follow the protocol, or contact the FMC’s office of Consumer Affairs & Dispute Resolution Services (CADRS) via email complaints@fmc.gov or phone 202-523-5807.

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Several carrier members of the Transpacific Stabilization Agreement (TSA), FMC Agreement No. 011223 serving the East Asia/USA trade lanes, implemented General Rate Increases (GRIs) of USD 1500 per forty-foot equivalent unit (FEU) effective October 15, 2016. Effective October 15, CMA CGM, Hyundai, K Line, and Yang Ming implemented GRIs of USD 1500 per FEU. American President Lines (APL) reduced the GRIs for dry cargo from USD 1500 to USD 200 per FEU for USWC, IPI, MLB, and to USD 100 per FEU for USEC, RIPI. For dry cargo from West Asia origins to destinations in USWC, IPI, MLB, APL applied GRIs of USD 200 per FEU effective October 17, and withdrew GRIs for refrigerated cargo. Evergreen reduced the GRIs from USD 1500 to USD 250 per FEU for USWC/G4 cargo, to USD 150 per FEU for cargo delivered to other inland via USWC (except G4 States), and to USD 300 per FEU for all other cargo. For origins in India, Sri Lanka, Pakistan, and Bangladesh, the GRIs were USD 200 per FEU. Hapag Lloyd applied GRIs of USD 1200 per FEU. For cargo from India, Bangladesh, Pakistan, and Sri Lanka, Hapag Lloyd initially had announced its postponement of GRIs from effective October 15 to October 17 and its amount revision to USD 300 per FEU, and recently announced another postponement to November 4 with the amount will be USD 300 per FEU. NYK applied GRIs of USD 1000 per FEU. COSCO cancelled the GRIs of USD 600 per FEU for dry cargo in its entirety on October 16 and postponed to effective November 1. For refrigerated cargo, COSCO implemented GRIs of USD 1000 per FEU effective October 1, and on October 16 GRIs of USD 600 per FEU remained effective. OOCL cancelled the October GRIs. GRI amounts for all other container sizes as per formula.

Several TSA carrier members filed new GRIs, effective December 1, 2016. Carriers CMA CGM, COSCO, Evergreen, Hyundai, Maersk, OOCL, Yang Ming filed GRIs of USD 600 per FEU. However, Hapag Lloyd filed USD 700 per FEU; K Line filed USD 800 per FEU; APL and NYK filed USD 1000 per FEU, in their respective tariffs. APL filed additional GRIs of USD 1000 per FEU, effective December 15, 2016. CMA CGM also filed additional GRIs of USD 600 per FEU effective December 15, 2016 and USD 1000 per FEU effective January 01, 2017. GRI amounts for all other container sizes are as per formula. This will be the twelfth GRI of the year for the East Asia/USA trade lane.

The TSA's 13 member carriers are: American President Lines, CMA CGM, COSCO Container Lines, Evergreen Marine, Hanjin Shipping, Hapag-Lloyd AG, Hyundai Merchant Marine, Maersk Line, Mediterranean Shipping, NYK Line, OOCL, Yang Ming Marine, and Zim Integrated Shipping Services. The group's web site at www.tsacarriers.org provides additional information; however, each carrier maintains its own tariffs and controls its own pricing. The TSA Carrier group only issues recommended guidelines to its member carriers.

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Several members of the Transpacific Stabilization Agreement Westbound (TSA), FMC Agreement No. 011223, whose member carriers serve the USA/East Asia trade lanes, filed General Rate Increases (GRI), effective December 1, 2016, at USD 80 per 20' and USD 100 per 40' for dry cargo from US West/East/Gulf Coast Ports, and USD 120 per 20' and USD 150 per 40' for dry cargo from IPI/MLB/RIPI. However, NYK updated its tariff to reflect GRIs of USD 160 per 20’ and USD 200 per 40’/45’ for dry cargo. Several member carriers also filed GRIs for reefer cargo, ranging from USD 80 to USD 200 per container, effective December 1. GRI amounts for all other container sizes as per formula. For more information, visit www.tsa-westbound.org.

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