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Signals™ Headlines - February 3, 2006

WTSA and TSA to Begin Monthly Bunker/Inland Fuel Surcharges Adjustments

Constantly fluctuating fuel costs have prompted carrier members of both the Transpacific
Stabilization Agreement (TSA)
and the Westbound Transpacific Stabilization Agreement (WTSA)
to announce monthly bunker and inland fuel surcharge adjustments. The monthly adjustments
will take effect May 1, 2006 and will be calculated using the latest marine fuel and inland
fuel rates. Both TSA and WTSA currently adjust these fuel surcharges quarterly, however,
due to the current volatile fuel markets even quarterly adjustments are not keeping pace
with changing fuel prices.

“Fuel prices have been so volatile in recent months that the lag time between collection
of fuel price data and quarterly surcharge adjustments has made it difficult for shippers
to plan their costs and for carriers to recover theirs,” said Albert A. Pierce, Executive Director of the TSA and WTSA.
“Lines feel that a more timely calculation method in this kind of environment would be helpful to

The following carriers are members of both TSA and WTSA: American President 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. Mitsui O.S.K.
is a member of the TSA. China Shipping Container Lines is a member of the WTSA.
Additional info on surcharges applied by the TSA Carriers can be viewed at
WTSA members provide info at www.wtsacarriers.org.

New California Law Limits Container Demurrage Charges

As of January 1, 2006 it is now illegal for California marine terminal operators to charge
truckers demurrage fees for late equipment returns if circumstances beyond the truckers control
prevented on-time return. Marine terminals can no longer charge late fees when return of the
equipment is impossible due to congestion, labor disruptions at the ports, acts of God or
because a terminal cannot locate a specific container. Under the new law, marine terminal
operators will also not be allowed to shut truckers out of port facilities while detention
or demurrage charges are disputed.

Before this new law went into effect truckers complained of being charged unfair
late fees, and of being locked out of port facilities when disputing such charges.
The Sacramento-headquartered
California Trucking Association
(CTA) commented that
the legislation “brings to an end years of unfair billing practices, particularly
arbitrary and excessive fee assessments and termination of interchange rights,
against intermodal motor carriers moving containers primarily between ports,
terminals, and cargo.” Governor Schwarzenegger signed
California State Senate Bill SB45, sponsored by
State Senator Richard Alarcón, into law September 22, 2005,
and it became effective on January 1, 2006.

This new law will likely prompt ocean carriers and marine terminal operators to amend
their Equipment Interchange Agreements (EIAs). These agreements, which truckers must sign
before receiving equipment, often stipulate fines for late equipment return. Amendments
to terminals tariffs covering California ports may also be necessary.

FMC Investigates Unlicensed Household Goods Movers

The FMC has announced an investigation in FMC Docket
into possible shipping act violations of nine unlicensed
household goods forwarders. The Commission’s investigation
was prompted by over 250 consumer complaints against the companies named in Docket 06-01,
viz: Moving Services, L.L.C., International Shipping Solutions, Inc., Dolphin International
Shipping, Inc., Worldwide Relocations, Inc., All-in-One Shipping, Inc., Boston Logistics Corp.,
Around the World Shipping, Inc., Tradewind Consulting, Inc., Global Direct Shipping
These companies and many of their officers are under investigation for a long list of alleged
Shipping Act violations, including operating without obtaining OTI licenses, proof of financial
responsibility (bonds), or published tariffs for their NVOCC services during 2004 and 2005.
Additionally, the companies also allegedly failed to establish, observe, and enforce just
and reasonable practices while receiving, handling, storing or delivering property.
Consumer complaints received by the Commission about these companies included lost
cargo, unreasonably high rates for cargo release, and failure of delivery. With the
exceptions of Tradewind Consulting Inc. and Global Direct Shipping, Inc., all other
companies are incorporated in the state of Florida. Tradewind Consulting is incorporated
in New York. Global Direct Shipping maintains an office in Delaware and the United Kingdom,
but conducts business via the internet through a Florida based company.

The FMC also filed and won preliminary injunctions against four of the companies under
investigation. On January 17, 2006, in the U.S. District Court for the Southern
District of Florida granted injunctions against All-In-One Shipping, Inc., Around
the World Shipping, Inc., Boston Logistics Corp., Global Direct Shipping and company
officials. The injunctions prohibit these companies from acting as NVOCCs without
licenses, bonds and tariffs. The injunction will remain in effect until ten days after
the completion of the FMC’s investigatory proceeding.

The initial decision in Docket 06-01 will be issued by the FMC’s Administrative Law
Judge by January 11, 2007. The Commission’s final decision is expected by May 11, 2007.
Any persons having an interest in the proceedings may file a petition to intervene with
the FMC. Questions regarding this proceeding should be addressed to FMC Secretary
Bryant L. VanBrakle, tel: 1-202-523-5725, or email: secretary@fmc.gov.

WTSA Carriers Raise U.S.-Asia Metal Scrap Freight Rates

The Westbound Transpacific Stabilization Agreement (WTSA), whose member carriers serve
the trade from the USA to East Asia, announced increases to metal scrap freight rates
and a new limit to container “free-time” in China. The increases and new limit will
go into effect February 15, 2006.

New scrap metal rates will be US$150 per 40-foot container and US$120 per 20-foot container.
WTSA reports that during 2005 metal scrap was the second largest containerized cargo
moving from the U.S. to Asia. Due to increased industrial production, scarcity and
rising prices for steel, copper, aluminum and other metals demand for metal scrap in
Asia is high, particularly in China. Strict Chinese regulations on overseas metal
and plastic scrap exporters have also led to some documentation and inspection delays.

The new container free-time limit for all China destination points will be 12 calendar
days. Equipment detention charges will be assessed after the 12-day period.
According to the WTSA, some shippers use the free-time allowances to ship large
amounts of metal scrap before actually lining up a buyer. Limits to free-time
allowances are aimed at improving equipment availability and recovery of delay-related
costs. WTSA is a voluntary discussion and research forum of 11 major container shipping
lines serving the trade from ports and inland points in the U.S. to destinations
throughout Asia. The 11 members 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
For more information visit www.wtsacarriers.org.

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Vol. 10, No. 2, February 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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