September 7, 2004
Volume 8, Number 09
Oakland, California

SIGNALS™ provides detailed information on the regulations and activities of the US Federal Maritime Commission (FMC), and related developments in the ocean freight industry. For past issues, please consult our index.

 FMC Fee Increase and Revision: Docket 04-11

The Federal Maritime Commission has proposed a revision and update of its existing fees for (1) filing petitions and complaints; (2) various public information services, such as record searches, document copying, and admissions to practice; (3) ocean transportation intermediary (OTI) applications; (4) applications for special permission; (5) service contract corrections; (6) agreements; and (7) passenger vessel performance and casualty certificate applications. These revised fees reflect current costs to the Commission. In addition, the Commission is proposing to add a separate fee of $75 for the filing of terminal exempt agreements. This new fee would reduce the current $138 fee. Because terminal exempt agreements generally take less time to process than similar agreements between ocean carriers the Commission has proposed this separate lower fee for terminal exempt agreements. Docket 04-11 also makes revisions to the Code of Federal Regulations (CFR) to reflect these fees and related changes.

The FMC's current fee schedule has been in effect since July 15, 2002. The proposed revisions include fee increases that reflect increased labor and processing costs, and some fee reductions. The increases are based on cost analysis, and not a fixed percentage. The proposed new application fee for a new OTI license will increase from $799 to $825. The fee for an OTI license amendment application will increase from $506 to $525. Comments on the proposed new fees may be filed with the FMC Secretary, and are due by Sept. 29, 2004.

 FMC Announces Internal Realignment of Bureaus and Offices

The Federal Maritime Commission recently implemented a realignment of its key bureaus and offices. On August 23, 2004 the FMC Office of the Executive Director, which previously oversaw the Commission's three program bureaus and four administrative offices, was split into two separate offices: the Office of Administration and the Office of Operations. Dr. Austin Schmitt now heads the Office of Operations with oversight of the three program bureaus: the Bureau of Certification and Licensing (formerly the Bureau of Consumer Complaints and Licensing); the Bureau of Enforcement; and the Bureau of Trade Analysis. Dr. Schmidt is also directly in charge of the FMC Area Representatives (formerly assigned to the Bureau of Enforcement). Mr. Bruce Dombrowski, formerly the Executive Director, now heads the Office of Administration, overseeing the four administrative offices: the Office of Budget and Financial Management; the Office of Human Resources; the Office of Information Technology; and the Office of Management Services.

Due to the rapid growth of the Commission's programs for consumer complaints and alternative dispute resolution these programs have been renamed the Office of Consumer Affairs and Dispute Resolution Services. Ronald Murphy, Esq., is now director of this office, which now reports to the FMC Office of the Secretary. The Bureau of Certification and Licensing remains headed by Ms. Sandra Kusumoto and she is also responsible for passenger vessel certifications, and licensing and financial responsibility (bonding) requirements of entities regulated by the Commission.

This organizational realignment comes after several months of FMC review into how the agency could best perform its duties in light of the changing maritime industry. In an FMC press release issued August 19, 2004, Chairman Blust stated, "I am very confident that our revised organizational setup will serve our stakeholders more efficiently and responsively. Not only will it provide an effective regulatory structure suitable for today's shipping industry, it will also allow us the flexibility necessary to grow and change as the industry continues to evolve."

 Docket No. 04 -10: City of Portland, ME and Scotia Prince Cruises Agreement

An exclusive "docking and lease agreement" between the City of Portland, Maine and Scotia Prince Cruises Limited, a Bermuda corporation, has come under investigation by the FMC. Under the agreement, filed with the Commission on August 23, 2004, Scotia Prince leases docking and terminal facilities from Portland for purposes of operating a daily passenger and passenger vehicle service between Portland and Yarmouth, Nova Scotia. The agreement contains exclusive use and non-compete provisions. These provisions have prompted the Commission to issue an Order of Investigation and Hearing, Docket 04-10 to investigate this agreement, which has been assigned FMC Agreement No. 201158.

According to Docket 04-10, in the agreement the City of Portland agrees not to allow any other operator permission to use its terminal premises for passenger or passenger vehicle service to or from Portland during Scotia Prince's scheduled May through October season. In return, Scotia Prince agrees not to operate in any competitive passenger or passenger vehicle service between any other New England port and any port in Nova Scotia.

This exclusive agreement appears to grants Scotia Prince a monopoly on passenger and passenger vehicle service between Portland, Maine and all ports in Nova Scotia, including Yarmouth. Under this agreement Portland is protected from possible competition from Scotia Prince at any other New England port. These restrictive provisions have raised concerns with the Commission and Bay Ferries Limited, a passenger and passenger vehicle line operating in the Maine and Canada areas has filed comments objecting to this agreement. The Commission will investigate to determine whether the City of Portland, Maine and Scotia Prince Cruises Limited are in violation of the Shipping Act. An initial decision will be issued by August 23, 2005, and the final decision will be issued by the FMC by Dec. 21, 2005.

 Docket No. 04-08: Qin's Incorporated and Superior Link International

Qin's Incorporated has filed a complaint with the FMC against Superior Link International, Inc. According to the complaint, filed August 10, 2004, Qin's alleges that Superior Link refuses to release two of Qin's containers. Qins claims due to this violation of the Shipping Act it has suffered damages of $23,626. Qin's asked the Commission to order Superior Link to pay reparations, court costs, attorney's fees and any other relief, if the Commission finds this warranted. An initial decision in this Docket No. 04-08 will be issued by the FMC's Administrative Law Judge by August 4, 2005.

 Docket No. 04-09: American Warehousing and Port of NY & NJ

American Warehousing of New York, Inc. has filed a complaint with the FMC against The Port Authority of New York and New Jersey. In the complaint, filed August 18, 2004, American Warehousing claims that the Port Authority has refused to negotiate a long-term extension or renewal of their Marine Terminal Lease Agreement. American Warehousing also claims it has suffered substantial and ongoing economic damages. American Warehousing asked the Commission to order the Port Authority to recommence negotiations for a long-term extension of its lease, and to pay reparations exceeding $15,000,000 per year, including interest, attorney fees and any other damages as may be determined by the FMC. An initial decision in this Docket 04-09 will be issued by August 11, 2005.

 TSA Carriers Launch Website; Maersk Sealand Announces Departure

The Transpacific Stabilization Agreement (TSA) has launched a website The site lists current and upcoming surcharges, bunker and Alameda Corridor surcharge calculators, market forecasts and other useful information. The TSA is an FMC approved carrier agreement of 14 leading ocean carriers serving the East Asia/USA trade. As of September 17 the TSA will lose Maersk Sealand who recently announced its departure from the agreement.

 FMC Accepts Supplemental Comments on NVOCC Petitions

The FMC has decided to accept additional comments on the petitions seeking service contracting authority and exemption from tariff publishing requirements for non-vessel operating common carriers (NVOCCs). In response to requests from seven of the petitioners the FMC has invited interested persons to submit supplemental comments on FMC Petition Nos. P3-03, P5-03, P7-03, P8-03, P9-03, P1-04, P2-04 by September 30, 2004. No indication by the FMC has been given as to when it will make a decision on these petitions. However, in its latest action the Commission did note "because the Supplemental Comments provide a unified, tangible proposal to the overarching NVOCC tariff publication exemption matter, the granting of this Motion and the acceptance of the comments into the record may serve to advance an administratively final decision rather than postpone one." Filed comments in these matters may be viewed on the Commission's web site at under the Active Docket and Petition Logs.

     Volume 8  Number 09     September, 2004    

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