The Federal Maritime Commission announced that it has recently entered into 18 compromise agreements, resulting
in the collection of $514,500 in civil penalties. These agreements are the result of investigations conducted
by FMC Area Representatives of the Office of Operations located in Los Angeles, New Orleans, New York,
Seattle, South Florida and Washington, DC into violations of the Shipping Acts by a vessel operating
common carrier (VOCC), ocean transportation intermediaries (OTIs) operating as forwarders and/or
non-vessel-operating common carriers (NVOCCs) and unlicensed entities. Staff attorneys with the
Bureau of Enforcement negotiated the compromise agreements announced March 24, 2005. In concluding
these compromises the parties involved did not admit any violations of the Shipping Act or FMC
regulations. Details are as follows:

Almar USA Corporation, a licensed OTI-NVOCC located in Miami, FL allegedly accepted and transported
cargo for an unlicensed OTI and provided transportation in the liner trades that was not in accordance
with the rates and charges set forth in its published tariff. In compromise of these allegations, Almar
made a payment of $20,000.

Asia Pacific Express Co., Ltd. and APE Freight International, Inc. Asia Pacific Express, an NVOCC
based in Hong Kong, allegedly accessed another OTI’s service contract and utilized the services of an unlicensed
NVOCC, APE Freight, as destination agent in the United States for shipments made under this service contract,
in violation of section 515.3 of the Commission’s regulations. APE Freight allegedly violated the Shipping Act
by failing to have a license, proof of financial responsibility or a tariff at the time it performed these
services for Asia Pacific. In settlement of these allegations, Asia Pacific and APE Freight collectively paid
$22,000.

Carga Tica International, Inc., an OTI domiciled in Miami, FL allegedly operated as an OTI
without having obtained a license, published a tariff or furnished proof of an OTI bond and unlawfully
accessed service contracts in order to obtain transportation at rates less than would otherwise be
applicable. In settlement of these allegations Carga Tica paid $15,000.

Cibao Cargo Inc., a licensed NVOCC located in New York, NY allegedly unlawfully received
transportation services under service contracts with VOCCs, provided ocean transportation services prior
to issuance of an OTI license and obtained transportation at less than the otherwise applicable service
contract rates by misdeclaring the commodity shipped. Cibao made a payment of $15,000 to settle the allegations.

City Ocean International, Inc. and City Ocean International Freight Co., Ltd. City Ocean
International,
a licensed NVOCC located in Walnut, CA and City Ocean International Freight, a bonded NVOCC located in Shenzhen,
China, allegedly violated the Shipping Act by accessing service contracts to which they were not signatories,
obtaining ocean transportation for property at less than the rates and charges that would otherwise have been
applicable and by providing transportation not in accordance with the rates and charges set forth in their
published tariffs. In compromise of these allegations these two companies made a payment to the FMC of $60,000.

Elite Shipping, Inc., an NVOCC operating in Miami, FL allegedly operated as an NVOCC without
obtaining an OTI license, publishing a tariff, or providing proof of the requisite financial responsibility.
In compromise of these allegations, Elite Shipping paid $20,000.

Formerica Consolidation Services, Inc., an NVOCC domiciled in Jamaica, NY allegedly operated in
violation
of the Shipping Act by providing NVOCC services in the United States – Far East trades without having obtained
an
OTI license, without publishing a tariff or providing proof of a valid OTI bond. Formerica also allegedly
unlawfully
entered into service contracts with VOCCs and received transportation services at less than the rates and
charges
that would otherwise have been applicable. Formerica made a payment of $25,000 in settlement of these
allegations.

Francisco Rodriguez d/b/a Dominicana Shipping Company, a licensed OTI located in New York,
NY allegedly violated the Shipping Act by unlawfully entering into service contracts and acting as an OTI
prior to having obtained an OTI license, published a tariff, or furnished proof of an OTI bond. Dominicana
Shipping made a payment to the FMC of $15,000 in settlement of these allegations.

Frontier Liner Services, Inc., a VOCC located in Miami, FL allegedly provided ocean
transportation
services at less than the rates and charges shown in its published tariff and accepted and transported cargo
for the account of unlicensed NVOCCs. It was further alleged that Frontier entered into service contracts
with unlicensed NVOCCs that did not publish tariffs or maintain bonds as required. Under the settlement
agreement reached Frontier made a payment of $55,000.

Global Alliance Logistics (LA), Inc., a licensed NVOCC based in Inglewood, CA had allegedly
incorporated companies affiliated with Global Alliance to operate as the company’s “branch offices” since
January 2001 without obtaining the requisite OTI licenses and bonds for these separately incorporated
companies. Global Alliance and its affiliated companies have paid the sum of $50,000 in settlement of
these allegations.

InterWorld Industrial, Inc., a proprietary shipper located in Woodland Hills, CA
allegedly
permitted unlawful access to its service contracts and in so doing provided services as an NVOCC without
obtaining a license, publishing a tariff or providing proof of an OTI bond. In compromise of these
allegations, InterWorld made a payment of $17,500.

Montero Shipping Company, an NVOCC located in the Bronx, NY allegedly unlawfully
entered into
service contracts and acted as an OTI prior to having obtained an OTI license, published a tariff, or
furnished proof of an OTI bond. In settlement of these allegations Montero paid $20,000.

Monumental Shipping & Moving Corporation, an NVOCC located in East Elmhurst, NY
allegedly
operated as an NVOCC in the United States trades prior to obtaining a license, publishing a tariff,
or
furnishing proof of an OTI bond. Monumental also allegedly entered into service contracts with an
ocean
common carrier and obtained transportation services thereunder at less than the rates and charges
otherwise applicable. Under the terms of the compromise Monumental paid $20,000.

Perfect Express Corporation, a licensed NVOCC located in Bensenville, IL along with
separately
incorporated affiliates allegedly operated as a single ocean transportation intermediary in the
liner trades
without obtaining OTI licenses and bonds for the incorporated affiliates in violation of section
19 of the
Shipping Act. Perfect Express and its affiliated companies collectively paid $52,500 in settlement
of
these allegations.

Robert A. Pfeiffer d/b/a Auto Shipping International, a licensed freight
forwarder located
in Monroe, NJ allegedly improperly obtained forwarder compensation on shipments where no
forwarding services
were performed. Auto Shipping International surrendered its OTI license and paid $17,500 in
settlement of
these allegations.

Quality Express USA, Inc. and Quality Express Cargo, Ltd. Quality Express USA,
Inc., a
licensed NVOCC based in Jamaica, NY and Quality Express Cargo, Ltd., its affiliated agent,
based in Shanghai,
China, allegedly knowingly and willfully obtained transportation of property at less than the
applicable
rates and charges published in VOCC service contracts by means of misdescribing the
commodities shipped.
It was also alleged that they allowed other NVOCCs unlawful access these same service
contracts, thereby
allowing third parties to obtain rates more favorable than the rates otherwise applicable. In
compromise of
these allegations, Quality Express USA and its affiliated agent collectively made a payment of
$45,000.

Transporte Medrano, Inc., d/b/a Medrano Express, an NVOCC located in
Hempstead, NY, allegedly
operated as an NVOCC in the United States trades prior to obtaining a license, publishing a
tariff or
furnishing proof of an OTI bond. Medrano has paid $25,000 in settlement of the allegations.

Williams Caribbean Shipping and Delivery Services, Inc., an NVOCC located
in New York,
NY, allegedly operated as an OTI without first having obtained an OTI license, publishing
a tariff or
furnishing proof of an OTI bond. It was also alleged that Williams unlawfully entered into
service
contracts and transported cargo pursuant to those contracts in the United States –
Caribbean trades.
Under the terms of compromise, Williams made a payment of $20,000.

On March 3, 2005 FMC Chairman Steven R. Blust made his annual appearance before the US
House
Subcommittee on Coast Guard and Maritime Transportation to review the Commission’s
proposed budget
for fiscal year 2006. Blust also included an overview of significant work and changes
FMC has
recently undertaken. Commissioner Blust appeared along with Amy W. Larson, the
Commission’s General
Counsel, Austin L. Schmitt, the Director of Operations, and Bruce A. Dombrowski, the
Director of Administration.

President Bush’s fiscal year 2006 budget proposal appropriates $20,499,000 for the FMC.
This will be a
6 percent increase over fiscal year 2005, which ends Sep. 30, 2005. About 75 percent of
the Commission’s
budget is dedicated to supporting the Commission’s current programs and staff. It does
not allow for the
hiring of any additional positions. Official travel is not budgeted for any increase,
however Blust remarked
travel remains an essential aspect of the FMC’s effort to provide better service to the
ocean transportation
industry and effective accomplishment of oversight duties.

Blust highlighted the Commissions recent work and implementation of the new NSA Rule,
as well as the new
regulations governing agreements among ocean common carriers and marine terminal
operators. He also pointed
out that the Commission continues to address restrictive or unfair foreign shipping
practices. The FMC is
continually monitoring the effects of the bilateral maritime agreement between the US
and China which came
into effect April 2004. FMC is planning to issue a final decision on whether or not
the agreement is
providing adequate relief to U.S. shipping companies. Blust remarked that industry
feedback on the agreement
has been positive, and 29 OTI-NVOCCs have amended their surety bonds filed with the
Commission in order
to use these to satisfy China’s requirements for NVOCC licensing.

Blust also reviewed the agency’s recent public outreach programs, including its
informational seminars
and FMC staff briefings with various industry representatives. These activities have
helped create a
forum for continued and enhanced dialogue between the industry and the Commission,
as well as increased
staffs’ knowledge of current issues and concerns facing the maritime community.

Blust also told Congress that the agency’s new organizational structure has
maximized staff effectiveness
and resulted in better service. In late 2004 the FMC completed a reorganization of
its key staff and bureaus.
It established a new Office of Operations, headed by Austin L. Schmitt, to
coordinate the Commission programs
under the Bureau of Enforcement, the Bureau of Trade Analysis, and the Bureau of
Certification and Licensing.
In addition, the Office of Operations oversees the Area Representatives. The other
key office established under
the reorganization is the Office of Administration, led by Bruce A. Dombrowski.
This office provides
administrative support or guidance to the program operations of the Commission.
The Director of Administration
is the Commission’s Chief Financial Officer, Audit Follow-up Management (Internal
Controls) Officer, and
Chief Acquisition Officer. The Deputy Director serves as the agency’s Chief
Information Officer, and the
agency’s Competition Advocate. Mr. Dombrowski was previously the Commission’s
Executive Director, a
position that was eliminated by the recent reorganization.

Lastly, Blust pointed out FMC’s important role in working with Homeland
Security to combat unlawful
participation in the U.S. ocean transportation system and the FMC’s cooperation
with other government
agencies to ensure a safe and efficient maritime transportation system.

The carrier members of the Transpacific Stabilization Agreement (TSA),
FMC Agreement No.: 011223,
serving the East Asia/USA trade lane have recently filed or announced General
Rate Increases (GRIs), and an
increased Panama Canal surcharge. The following amounts are in US dollars and
apply per container according
to sizes as noted. Due to FMC regulations these increases must be filed in FMC
tariffs at least 30 days
before their effective dates.

General Rate Increase (GRI): effective May 1, 2005

GRI amounts for LTL cargo vary.

The Panama Canal Transit Fee will increase to $165 per container
effective May 1, 2005; LTL amounts vary.

TSA Member Carriers are American President Lines, CMA-CGM, COSCO
Container Lines Ltd., Evergreen Marine
Corp., Hanjin Shipping, Hapag-Lloyd Container Line, Hyundai Merchant
Marine, K Line, Mitsui O.S.K. Lines,
NYK Line, OOCL, P&O Nedlloyd and Yangming Marine. Additional
information on surcharges applied by the
TSA Carriers is available at
http://www.tsacarriers.org/adjustments.html.

FMC Commissioner Harold J. Creel, Jr. spoke at the International
Transportation Management Conference in
Houston, Texas, March 21, 2005. The conference panel addressed
globalization, deregulation, terrorism, new
security requirements, antitrust immunity and NVOCC confidential
contracts. Creel spoke on the topics of
antitrust immunity and NVOCC confidential contracts. He noted that
his remarks would be solely his own and
did not necessarily represent those of the FMC. Creel spoke in
detail of the history of service contracts
from the enactment of the Shipping Act of 1984 to the NVOCC Service
Arrangement rulemaking of today.

Chairman Creel remarked on his personal concern regarding the
barring of NVOCCs from entering into NSAs
with other NVOCCs or with shippers’ associations that have NVOCCs
as members, as well as the barring of two
or more NVOCCs from offering joint NSAs, unless they are corporate
affiliates. Creel said he felt this would
deny small or medium NVOCCs the opportunity to enter into NSAs
with larger NVOCCs and noted that the purpose
of a shippers’ association is to permit smaller shippers and
NVOCCs to work together to obtain volume rates.
Creel said he thought NSAs “would create a second-class of
shippers’ associations, one with an NVOCC member,
and preclude it from enjoying the purported benefits of NSAs.”
However, Creel voted to approve NSAs “with the
understanding that the Commission could consider these issues at a
later day.” He also noted the recent appeals
filed with the U.S. Court of Appeals for the D.C. Circuit by The
International Shippers’ Association and the
American Institute for Shippers’ Associations challenging that
aspect of the NSA rule. While declining to
comment on the appeals, Creel said “the Commission is unlikely to
modify its final rule until the court rules on
those appeals.”

Creel also stated that as of March 15, 256 out of approximately
3,000 NVOCCs have registered to file NSAs.
However, FMC has received less than 20 NSA filings. He also
noted that there have been no NSAs filed by any of
the petitioners seeking the original relief and said it will
take some time for the industry to adjust to these
new rules. Similar to the implementation of service contracts in
1984, use of NSAs will start off slow and then
increase rapidly.