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Signals™ Headlines - November 3, 2005

FMC Holds Industry Briefing with the National Association of Waterfront Employees

In its efforts to gain better understanding and increase dialog with stakeholders
in the U.S. maritime industry the Federal Maritime Commission met with members of the

National Association of Waterfront Employers (NAWE)
. This industry briefing, held
October 19, 2005, was the sixth such briefing the FMC has held with various members
of the maritime industry. Among topics discussed at the briefing were the impact of
increasing cargo volumes on constrained port, marine terminal, rail, and highway
infrastructures, additional ways to keep cargo moving and the need to coordinate
at the local, state and national level when seeking solutions to common problems.
Marine terminal operators also commented on the improvements in port productivity
as a result of the
OffPeak PIERPass program
in effect at the
Ports of Los Angeles
Long Beach
. OffPeak created night and weekend OffPeak shifts for container
delivery and pick-up, as well as implemented a Traffic Mitigation Fee for all
pick-up/deliveries made outside of OffPeak hours. Panelists praised the program
for improving congestion within and outside the ports.

Docket 05-06: FMC Extends Comment Period on Additional NSA Rule Changes

The Commission received five comments regarding further changes to NVOCC Service
Arrangement rules that would allow multiple unaffiliated NVOCCs to jointly offer NSAs.
The comments came in response to the FMC’s Notice of Inquiry,

Docket No. 05-06
, issued
August 30, 2005. The NOI contains 15 questions concerning the impact and practicality
of multiple NVOCC NSAs. Comments were originally due October 6, 2005, but the deadline
was extended to October 20. The International Trade Surety Association, U.S. Department
of Justice, U.S. Department of Transportation
and the World Shipping Council
all filed separate comments. The Agriculture Ocean Transportation Coalition, FedEx Trade Networks
Transport & Brokerage, Inc.,
The National Industrial Transportation League,
North Atlantic Alliance Association, Inc.
and United Parcel Service, Inc.
filed joint comments with the Commission.

International Trade Surety Association, commented specifically on the issue of
financial responsibility if NVOCCs were allowed to offer joint NSAs. ITSA stated
that “the fact that two or more NVOCC offer services to one customer does not and
should not result in double liability by two NVOCCs acting as common carriers.”
ITSA stressed that only the NVOCC issuing the bill of lading or the financial
responsibility provider of the NVOCC should be held responsible in the event a
claim is filed. ITSA conjectured that issues with surety providers would arise
when two or more NVOCCs jointly offer services to a customer and agree to be jointly
and severally liable. ITSA suggested that in these cases the NVOCCs be required to
file for additional insurance or bond coverage.

U.S. Department of Justice, commented in support of the proposed joint
NSAs, stating that jointly-offered NSAs, while being subject to oversight under
antitrust law, would likely enhance competition and create greater contracting
flexibility for NVOCCs. U.S. Department of Transportation also commented in support
of jointly-offered NSAs. DOT also stressed that such agreements would likely not lead to
NVOCCs receiving antitrust immunity, however to prevent any misinterpretation of
such rule the FMC should include specific language stating NVOCCs are not immune
to antitrust laws. The World Shipping Council made a similar comment. Joint comments
urged the FMC to consider jointly-offered NSAs and provided detailed answers to all
the Notice of Inquiry’s 15 questions. Joint comments also stated that jointly-offered
NSAs would “increase the efficiency of the NVOCC marketplace and enhance competition –
ultimately resulting in more options and lower prices for shippers and beneficial
cargo owners.”

Peak Season Surcharges Extended for US East Coast All Water Services

Many carriers serving the Transpacific Eastbound Trades from Asia to the USA
have amended their tariffs to extend Peak Season Surcharges(PSS) through Jan 31,
2006 on shipments to or via US Atlantic Coast Ports. The PSS on shipments to or
via US Pacific Coast Ports will expire on Nov 30, 2005. Generally speaking, carriers
have filed as follows:


From: Ports & Points in Asia, To: USA Ports & Points
Effective: 15Jun2005 thru 30Nov2005, except as noted

US$300 per 20’container, US$400 per 40’container, US$450 per 40’high cube container, US$510
per 45’container


1. Shipments to or via US Atlantic (East) Coast Ports moving via the Panama Canal (All
Water Service) will be subject to the PSS thru 31Jan2006.

FMC Announces Compromise Agreements, Collects $305,000 in Civil Penalties

The Federal Maritime Commission announced five compromise agreements, resulting in the
collection of $305,000 in civil penalties. These agreements are the result of investigations
conducted by FMC Area Representatives of the Office of Operations into violations of the
Shipping Act. Staff attorneys with the Bureau of Enforcement negotiated the
announced October 5, 2005. In concluding these compromises the parties
involved did not admit any violations of the Shipping Act or FMC regulations.
Details are as follows:

Aces, Ltd. and Northeast Consolidators, Inc. Aces, Ltd. is a licensed ocean freight
forwarder and Northeast Consolidators, Inc. is a licensed NVOCC, both are located in
Scituate, MA. Allegedly, Aces obtained freight forwarder compensation from ocean
common carriers on shipments in which it had a direct or indirect beneficial interest.
Northeast Consolidators allegedly obtained transportation for property at less than
the applicable rates or charges by allowing Aces to collect forwarder compensation
on shipments handled by Northeast. In compromise of these allegations Aces and
Northeast made a payment in the amount of $55,000.

Air Parcel Express, Inc. (APX), a licensed ocean transportation intermediary
located in Miami, FL, allegedly accessed service contracts to which it was not a
signatory, thereby obtaining ocean transportation for property at less than the
applicable rates and charges. Furthermore, APX allegedly operated as an NVOCC,
without an OTI license, tariff or proof of required financial responsibility.
In compromise of these allegations APX made a payment of $25,000.

Cosa Freight Inc., a licensed and bonded ocean transportation intermediary
located in City of Industry, CA, allegedly accessed service contracts to which
it was not a signatory thereby obtaining ocean transportation for property at
less than the applicable rates and charges. Cosa Freight also allegedly provided
transportation that was not in accordance with the rates and charges as published
in its tariff. Cosa Freight made a payment of $60,000 in settlement of these charges.

Nations Express Inc., a licensed freight forwarder located in Charlotte, NC,
allegedly provided service as an ocean freight forwarder, and collected compensation
therefore, without obtaining an OTI license and without providing proof of financial
responsibility. In compromise of these allegations Nations paid $25,000.

Topocean Consolidation Service, Inc., a licensed NVOCC based in Los Angeles, CA,
allegedly obtained ocean transportation for property at less than the applicable rates
by improperly describing the commodities and through the unlawful use of equipment
substitution. Topocean also allegedly provided service that was not in accordance
with its published tariff. In compromise of these allegations, Topocean made a
payment of $140,000 to the FMC.

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Vol. 9, No. 11, November 3, 2005

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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