Volume 23, Number 4
April 2, 2019
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.
Signals™ Headlines - April 2, 2019

Michael A. Khouri Named FMC Chairman

On March 7, 2019, the White House notified the Federal Maritime Commission that President Donald Trump has designated Michael A. Khouri as Chairman. He had been serving as Acting Chairman since January 2017.  In response, Chairman Khouri said "I thank President Trump for his expression of confidence. I believe it reflects support for the great work that the entire FMC team is doing to ensure fair competition and integrity for America’s ocean supply chain."

Chairman Khouri began his service as an FMC Commissioner in January 2010.   He was first nominated by President Obama and confirmed by the U.S. Senate in December 2009, was re-nominated and confirmed for a full five-year term in November 2011 and was re-nominated and confirmed for his current term in June 2016.

Chairman Khouri is a forty-eight-year veteran in the maritime industry from positions held in marine vessel operations, legal and executive positions. He also served on the boards of directors at the Waterways Council, Inc. and the American Waterways Operators Association. Mr. Khouri began his career as a deck crewman for Paducah, KY-based Crounse Corp., where he worked up in rank with service in the engine room and then into the wheelhouse as Pilot and Captain, earning his U.S. Merchant Marine Officer’s License as Master and First-Class Pilot on Steam and Motor Vessels. He then served for twenty-three years with American Commercial Lines, the largest U.S. inland marine company, holding executive positions including General Counsel & Secretary, Senior Vice President for Law & Corporate Affairs, and Senior Vice President for Transportation Services-marine operations. Mr. Khouri then joined MERS/Economy Boat, serving as President & COO before moving home to Louisville to join the law firm of Pedley & Gordinier.

Mr. Khouri received his BA in Economics in 1971 from Tulane University, and his JD from the Brandeis School of Law-University of Louisville in 1980. He is also a graduate of the Harvard Business School’s Advanced Management Program.

FMC Docket 19-01, Increase to Civil Monetary Penalties

The Federal Maritime Commission (FMC) has implemented increases to maximum civil monetary penalties as required by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. Effective January 15, 2019 the maximum penalty for violations of the Shipping Act or Commission regulation or order is now USD 12,007; each day of a continuing violation or each bill of lading issued is a separate violation. Violations found to be “knowing and willful” are subject to a maximum penalty of USD 60,039 each. Ocean carriers and NVOCCs who are found to have operated in the U.S. trades after their tariffs were cancelled or suspended by the FMC may be penalized USD 120,070. The full table of penalty amounts is documented in FMC Docket 19-01, which was published in the Federal Register and is accessible at https://www.fmc.gov/19-01/

Transpacific Eastbound Carriers File GRIs Effective April 15 and May 1, 2019

Several leading carriers serving the Trans Pacific Eastbound container trades have recently updated their respective tariffs to include new General Rate Increases (GRIs) effective April 15, 2019, including American President Lines (APL), CMA CGM, COSCO, Evergreen, Hapag Lloyd, Hyundai Merchant, Ocean Network Express (ONE), and Yang Ming.  See table below for GRI amounts per 40ft container; GRI amounts for all other container sizes are as per formula.  The April 15th GRIs will be the eighth GRI of 2019 for the East Asia/USA trade lane.

TRANSPACIFIC EASTBOUND (Asia to USA)
GENERAL RATE INCREASE (GRI)
Effective April 15, 2019
Carrier
in USD, per 40ft ctr
APL
1000
CMA CGM
1000
COSCO (see note 1)
800
Evergreen
1000
Hapag Lloyd
700
Hyundai
1000
Maersk (see note 2)
600
ONE
1000
Yang Ming
1000

NOTE 1:  COSCO GRIs apply on all cargo moving under service contracts only.

NOTE 2: Instead of filing an increase in their tariff, Maersk announced a contract increase for effective April 15, 2019 for the Far East Asia/USA trade lane.  The contract increase will affect those with service contract (SC) rates that expire April 14, 2019, who want new SC rates valid April 15, 2019 and beyond.  The contract increase will be USD 480/600/600/750 per 20ft/40ft/40HC/45HC dry container, respectively.  Once SC rates expire on April 14, 2019, tariff rates will apply until a SC written agreement is finalized to reflect the contract increase.  Filing of original SCs with FMC is required on or before the effective date; the deadline for filing SC amendments with FMC is within 30 days of scheduled effective date.

Several carriers updated their tariffs to include new General Rate Increases (GRIs) effective May 1, 2019, including American President Lines (APL), CMA CGM, COSCO, Evergreen, Hapag Lloyd, Hyundai Merchant, Ocean Network Express (ONE), and Yang Ming.  See table below for GRI amounts per 40ft container; GRI amounts for all other container sizes are as per formula.  The May 1st GRIs will be the ninth GRI of 2019 for the East Asia/USA trade lane.

TRANSPACIFIC EASTBOUND (Asia to USA)
GENERAL RATE INCREASE (GRI)
Effective May 1, 2019
Carrier
in USD, per 40ft ctr
APL
1000
CMA CGM
1000
COSCO (see note 1)
800
Evergreen
1000
Hapag Lloyd
700
Hyundai
1000
ONE
1000
Yang Ming
1000

NOTE 1:  COSCO GRIs apply on all cargo moving under service contracts only.

Transpacific Eastbound Carriers Update Alameda Corridor Charge

Some of the carriers serving the Transpacific Eastbound trade lane (U.S. imports) have recently updated their respective FMC tariffs to increase the Alameda Corridor Charges (ACC). The table below provides a summary of these charges.  The ACC applies on shipments that move via rail though the ports of Los Angeles and Long Beach.  

TRANSPACIFIC EASTBOUND (Asia to USA)
ALAMEDA CORRIDOR CHARGE (ACC)
in USD, per ctr
Carrier
20ft
40ft / HC
45ft
APL
23.26
46.52
52.34
CMA CGM
23.26
46.52
52.34
COSCO
25
50
56
Evergreen
27
54
59
Hyundai
27
54
60
OOCL
25
50
56
ONE
27
56
60
Yang Ming
27
54
60

Transpacific Westbound Carriers Update Alameda Corridor Charge

Some of the carriers serving the Transpacific Westbound trade lane (U.S. Exports) have recently updated their respective FMC tariffs to increase the Alameda Corridor Charges (ACC). The table below provides a summary of these charges. The ACC applies on shipments that move via rail though the ports of Los Angeles and Long Beach.     

TRANSPACIFIC WESTBOUND (USA to Asia)
ALAMEDA CORRIDOR CHARGE (ACC)
in USD, per ctr
Carrier
20ft
40ft / HC
45ft
APL
23.26
46.52
52.34
CMA CGM
23.26
46.52
52.34
COSCO
24
48
53
Evergreen
27
54
59
Hyundai
25
50
55
OOCL
23
46
52
ONE
27
56
60
Yang Ming
27
54
60
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