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Signals™ Headlines - April 4, 2007

China to Require Liner Conferences to File Agreements, Consult with Chinese Shippers

The People’s Republic of China (PRC) recently issued a decree announcing “strengthening of supervision” of liner
conferences and freight discussion agreements offering services to Chinese ports.  The three-page Decree 10 issued
by the PRC’s Ministry of Communication March 12, 2007 calls for liner conferences and freight discussion agreements
to designate a point of contact in China by April 15, 2007, establish “effective” communication with Chinese
shippers and shippers’ associations, submit agreements to the Ministry of Communications (MOC) and notify MOC
designated press agencies of any rate/surcharge changes.

This decree comes about five years after the PRC issued Regulations of the PRC on the
International Maritime Transportation
, which requires ocean carrier registration, tariff filing by ocean
carriers and NVOCCs, ocean carrier service contract filing, corporate status for NVOCCs and authorizing
investigation of competitition-prohibiting liner conferences and carrier agreements. These new regulations, which in
many ways are similar to the U.S. Shipping Acts, come five years after the PRC issuance of implementing rules. According to the recent Decree,
which includes six separate provisions, these latest requirements aimed at liner conference and freight discussion
agreements are issued in accordance with the International Maritime Transportation regulations and Implementing
Rules; and are intended to “facilitate the healthy development of China’s market for international container liner
transportation, ensure fair competition in international shipping market, and protect the lawful rights and
interests of carriers and shippers.”

According to the Decree, liner conferences and freight discussion agreements must designate a contact or
representative in China before April 15, 2007 and release the name and address of this contact to designated press
agencies, shippers/shippers’ associations and formally file the information with the MOC.  Establishment
of “effective consultation mechanism” with shippers or shippers’ associations in China to enable discussion and
consultation regarding changes to charges, freight rates, surcharges etc. is also required; however, date of
implementation for this provision was not stated.

Filing conference agreements, service operation agreements and freight rate agreements involving Chinese ports with
the MOC within 15 days of conclusion of the agreements will also be required.  These filing, which must be in
Chinese, must include, among other documents, minutes, decisions, agreements, discussion of grounds for change(s)
and record of consultation with Chinese shippers/shippers’ associations.  The main contents of agreements and
grounds for implementation must also be submitted to the Chinese Shipping Website and at least two other of designated press agencies at least 15
days prior to the effective date such agreements.  Dates of implementation for these provisions were not
included in the decree. For more information visit the PRC’s Ministry of Communication at http://www.moc.gov.cn .

FMC Docket 06-01: Two Settlements Approved After FMC Decision Reversal

The FMC has approved settlement agreements in Docket 06-01 with All-In-One Shipping, Inc. (AIO), and Around The
World Shipping, Inc.
(ATW) and respective company representatives. Docket 06-01 is a formal
investigation– launched in response to over 250 complaints of Shipping Act violations–into nine unlicensed
entities and several of their officers which operated as NVOCCs and/or ocean forwarders handling international
household goods shipments. These two settlements, brokered by the FMC’s Bureau of Enforcements (BOE), were
originally approved May 23, 2006. However, in a surprising order issued in November 2006, the FMC Commissioners
rejected these settlements on grounds that they did not sufficiently deal with redress of shippers’
complaints. FMC
Administrative Law Judge Clay G. Gutheridge
was assigned to further investigate complaints against AIO and
ATW.  Gurtheridge has now found the complaints–two against AIO and five against ATW–had in fact been
sufficiently resolved.  Accordingly, on March 23, 2007 the FMC issued an Order approving the two settlements
with effect from their original signing dates of May 23, 2006.  The FMC has yet to announce settlement
agreements with any other respondents in Docket 06-01.

TSA Adjusts BAF Calculation for TEUs, Increases Inland Fuel Charges

The carrier members of the Transpacific Stabilization Agreement (TSA), FMC Agreement No. 011223,
serving the East Asia/USA trade lane announced adjustment to calculation of Bunker Adjustment Factors (BAF) for 20ft
containers and increases to Inland Fuel Surcharges for May.  General Rate Increase (GRI) and increased Panama
Canal Surcharge are also set to go into effect May 1, 2007, with a Peak Season Surcharge (PSS) planned for June 15,

As of May 1 TSA will calculate bunker charges for 20ft containers on a basis of 80 percent of BAF charged for 40ft
containers.  BAF effective May 1 to 31, 2007 is as follows: US$ 435 per 20ft container, US$ 545 per 40ft
container, US$ 615 per 40ft hi-cube container, US$ 690 per 45ft container and US$ 12/WM.  IFC effective May 1
to 31, 2007 will be increased to US$ 195 per container per container for mini-land bridge (MLB) and inland point
intermodal shipments moving via rail, and to US$ 56 per container local and regional truck transport to “Group 4”
points in California, Oregon and Washington, and for East Coast local store-door truck moves.  The Panama Canal
Surcharge will be increased as of May 1, 2007 to US$ 212 per container, US$ 11 per metric ton and US$ 4.50 per cubic

General Rate Increases (GRI) will take effect on May 1, 2007 of US$ 650 per 40ft container for inland point and
minilandbridge intermodal shipments, US$ 500 per 40ft container for cargo moving via East and Gulf Coast all-water
service, and reverse inland point intermodal (RIPI) moves, and US$ 300 per 40ft container for West Coast
port-to-port and “Group 4” shipments to California, Oregon and Washington.  This GRI applies to both tariff and
service contract rates; however, TSA carrier members may negotiate varying GRI amounts for individual service
contracts, or make exceptions to some tariff rates.  The TSA Carriers also announced they will impose a Peak
Season Surcharge (PSS) of US$ 400 per 40ft container, effective from June 15, 2007 thru February 28, 2008.

TSA member carriers are American President Lines, 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
and Yang Ming Marine.  Visit www.tsacarriers.org for additional information.

WTSA Increase Inland Fuel Charge, Maintains Bunker Adjustment Charges

The Westbound Transpacific Stabilization Agreement (WTSA), whose member lines serve the US export
trades from the USA to East Asia, announced increases to their Inland Fuel Surcharges, but no change to their Bunker
Adjustment Factors (BAF) for May. BAF effective May 1, 2007 to May 31, 2007 will remain at current levels of US$ 436
per 20ft container, US$ 545 per 40ft/45ft container, and US$ 28 per WM.  Inland Fuel Charges for May will be
increased to US$ 195 per container for rail and intermodal rail/truck shipments, and US$ 56 per container for
local/regional truck shipments.

The 11 member carriers of WTSA are American President Lines, China Shipping Container Lines, COSCO
Container Lines, Evergreen Marine Corp., Hanjin Shipping, Hapag-Lloyd Container Line, Hyundai Merchant Marine,
“K” Line, NYK Line, OOCL
and Yang Ming Marine.   For more
information visit www.wtsacarriers.org.

TACA: Panama Canal Fee Increase May 1, 2007, Maintains BAF and CAF

The Trans-Atlantic Conference Agreement (TACA), whose member carriers serve the trade between the
USA and North Europe, United Kingdom and Ireland, Scandinavia and Baltic Ports, announced no changes to their
current Bunker Adjustment Factors (BAF) and Currency Adjustment Factors (CAF).  However, the Panama Transit Fee
is set to be increased May 1, 2007 to US$ 212 per container for eastbound and westbound shipments.  Current BAF
of US$ 395 per 20ft container, US$ 790 per 40ft/45ft container and US$ 40 per WM for shipments to/from Atlantic/Gulf
Coast Ports; and US$ 593 per 20ft container, US$ 1186 per 40ft/45ft container and US$ 59 per WM for shipments
to/from Pacific Coast Ports will remain effective until at least May 15, 2007.  TACA members are
Atlantic Container Line, Maersk Line, Mediterranean Shipping Co., NYK Line and
Revisions to surcharges are published in TACA’s relevant FMC tariffs, and are shown on its website:

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Vol. 11 No. 4, April 4, 2007

The information contained herein is obtained from reliable sources.
It is subject to change at any time, however, depending on changes in
laws and regulations. While we continually attempt to monitor this
information, we do not guarantee its accuracy and are not responsible
for any damages suffered by any party in reliance on it.
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