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Signals™ Headlines - August 3, 2006

FMC Commissioners Overturn Important Ruling on Service Contract Arbitration

The Federal Maritime Commission’s recent ruling in Docket 02-04
Anchor Shipping Co. vs. Alianca Navegacao Elogistica Ltda.
issued a strong statement affirming the
Commission’s obligation to investigate all claims of Shipping Act violations.  The ruling in Docket 02-04
overturned an earlier decision by an FMC Administrative Law Judge (ALJ) to dismiss allegations of Shipping Act
violations on the grounds that the allegations had already been settled in arbitration in favor of the complainant,
Anchor Shipping.  This docket is significant because in their official order, the Commissioners state the
ALJ’s earlier ruling was “fundamentally incorrect.”  Furthermore, FMC Chairman
and Commissioner Dye filed concurring comments with the order, emphasizing the Commission’s
duty to investigate all claims of Shipping Act violations, noting that “private parties cannot contract away
their access to Commission adjudication of Shipping Act claims through a reliance on arbitration or other
alternative dispute mechanisms.”

Anchor Shipping, Co., a non-vessel operating common carrier based in Coral Gables, Florida, originally filed a
complaint on March 7, 2002 with the Commission alleging numerous Shipping Act violations and breaches of contract
committed by Alianca Navegacao Elogistica
an ocean common carrier, with whom it had entered into a service contract.  Anchor sought
$1,000,000 in reparations.  Alianca filed a motion to dismiss the complaint on March 28, 2002, arguing that
allegations had already been settled in arbitration in accordance with the rules of the service contract.  Alianca further
noted that the arbiter awarded Anchor over $381,000 for damages, including lost profits and legal fees.
 Anchor later filed a motion with the FMC to amend its original complaint in April 2002 to include other
ocean common carriers Alianca allegedly operated with under agreements that had not been properly filed with by
the Commission.

FMC Administrative Law Judge Norman D. Kline dismissed Anchor’s complaint and request to
amend, in favor of Alianca’s motion to dismiss on May 2, 2002.  Judge Kline found that as it is the
Commission’s policy to encourage arbitration as a form of dispute resolution, and to give finality to
arbitral awards, it would be unfair to subject Alianca to litigation before the Commission for the same matter
that had already been settled in arbitration.  Judge Kline further stated, “such action does not mean
that the Commission is surrendering its jurisdiction to a court or tribunal, but only that it is respecting the
integrity of arbitration and enforcing the strong policy, embodied in federal statutory law and the
Commission’s own regulations, giving finality to arbitral decisions.”  Judge Kline also dismissed
Anchor’s motion to amend its complaint, reasoning that as the complaint would not be heard before the
Commission anyway, there was no reason to grant an amendment.

TACA Conference Maintains Current Bunker Surcharge, Currency Adjustment Factor

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 there will be no
changes made to current bunker surcharges through September 15, 2006.  TACA’s current Currency
Adjustment Factor (CAF) of 8 percent will also remain unchanged at least until September 15, 2006.  Bunker
Adjustment Factors (BAF) for August 16 – September 15, 2006 are as follows: to/from Atlantic/Gulf Coast
Ports, US$ 467/20ft, US$ 933/40ft/45ft and US$ 47/WM; to/from Pacific Coast Ports, US$ 700/20ft, US$
1400/40ft/45ft and US$ 70/WM.  TACA members are Atlantic Container Line, Maersk Line, Mediterranean
Shipping Co., NYK Line
and OOCL.  Revisions to surcharges are published in
TACA’s relevant FMC tariffs, and are shown at its website: www.tacaconf.com.

WTSA Lines Increase Inland Fuel Surcharges and Bunker Adjustment Factors

The Westbound Transpacific Stabilization Agreement (WTSA), whose member lines serve the US
export trade from the USA to East Asia, announced reductions to Bunker Adjustment Factors (BAF) for the fist
time in three months.  Inland Fuel Surcharges (IFC) will remain unchanged through the month of August.
 Details of the BAF are as follows:

Bunker (BAF) August 1 – August 31, 2006 Effective September 1 – September 30, 2006 US$ 472 per 20′ container US$ 508 per 20′ container US$ 590 per 40’/45′ container US$ 635 per 40’/45′ container US$ 30 per WM US$ 32 per WM

Inland Fuel Charges (IFC) for September will be set at US$ 232 per container for rail and intermodal
rail/truck shipments, and US$ 67 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.

TSA Carriers Increases Bunker Adjustment and Inland Fuel Surcharges

The carrier members of the Transpacific Stabilization Agreement (TSA), FMC Agreement
No. 011223, serving the East Asia/USA trade lane have amended their FMC tariffs to provide for
increases to Bunker Adjustment Factors (BAF) and Inland Fuel Charges (IFC) for the month of September.
 Details of the BAF are as follows:

Effective August 1 – August 31, 2006 Effective September 1 – September 30, 2006 US$ 445 per 20ft container US$ 475 per 20ft container US$ 590 per 40ft container US$ 635 per 40ft container US$ 665 per 40ft hi-cube container US$ 715 per 40ft hi-cube container US$ 745 per 45ft container US$ 805 per 45ft container US$ 13 per WM US$ 14 per WM

September Inland Fuel Charges (IFC) will be US$ 232 per container for mini-land bridge (MLB) and
inland point intermodal (IPI) shipments moving via rail, and US$ 67 per container for local and
regional truck transport to “Group 4” points in California, Oregon and Washington, and
for East Coast local store-door truck moves.  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,
and Yang Ming Marine.  Visit http://www.tsacarriers.org for additional

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Vol. 10, No. 8, August 3, 2006

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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