The U.S. Federal Maritime Commission (FMC) met on September 21, 2023 to receive updates from FMC staff on the implementation of the Ocean Shipping Reform Act of 2022 (OSRA-2022) and the public’s usage of FMC’s charge complaint process and dispute resolution services.

FMC staff reported on the various rulemakings which were mandated by OSRA-2022. Commission staff advised that the Detention and Demurrage Billing Practices final rule is close to being completed and presented to the Commission for a vote. OSRA-2022 mandated this rulemaking be completed by June 2023. FMC staff is also still working on drafting a proposed Final Rule on Unreasonable Refusal to Deal with Respect to Vessel Space Accommodations. OSRA-2022 mandated this rulemaking be completed by December 2022. Lastly, OSRA-2022 required the Commission to issue a rule addressing Unfair or Unjustly Discriminatory Methods. Commission staff is beginning to draft a proposed rulemaking addressing the Unfair or Unjustly Discriminatory Methods rulemaking requirement. OSRA-2022 mandated this rulemaking be completed by June 2023.

FMC staff reported on three other developments related to OSRA-2022 implementation:

• The Transportation Research Board is scheduled to complete a study on Best Practices for Chassis Pools by April 2024.
• FMC’s Office of Management and Budget is reviewing a proposed information collection that will allow the Commission to gather and publish information on total import and export tonnage and total loaded and empty twenty-foot equivalent units per vessel.
• FMC staff is working to establish a webpage on www.fmc.gov where the public can easily submit comments, complaints, concerns, reports of non-compliance, requests for investigations, and requests for alternative dispute resolution services.

Commission staff also briefed the Commissioners on requests from the public for FMC assistance with charge and cargo-related disputes. One provision of OSRA-2022 created a new process for parties to challenge charges levied by common carriers and the public is making active use of their ability to file charge complaints at the FMC. FMC staff reported that approximately $1.7 million in fees or surcharges have been voluntarily waived or refunded by common carriers since July 2022 through the filing of charge complaints. Commission staff anticipates initiating a rulemaking in 2024 that will establish a permanent charge complaint process.

The Commission’s Office of Consumer Affairs and Dispute Resolution Services (CADRS) has handled more than 300 matters to date this fiscal year. Approximately three-quarters of these cases are related to commercial cargo import shipment issues. The Commission was briefed that almost one-half of the total export related cases concern agricultural shipments. CADRS identified a key goal for the coming fiscal year is increasing its public outreach and education efforts.

The U.S. Federal Maritime Commission (FMC) received one new formal complaint in September 2023 alleging violations of the U.S. Shipping Act and FMC regulations.

Unreasonable Cargo Practices & Various Shipping Act Violations – FMC Docket No. 23-10:  Bed Bath & Beyond Inc. (BBB) filed a formal complaint against Yang Ming Marine Transport Corp., alleging that Yang Ming violated the U.S. Shipping Act by exploiting price inflation in container shipping during the COVID-19 pandemic and unjustly and unreasonably exploiting customers.

Specifically, BBB alleges that between 2021 and 2022 Yang Ming consistently failed to meet its existing service contract commitments and thereby forced BBB to buy space on the spot market at enormous expense and pay additional peak season surcharges. BBB also alleges Yang Ming charged detention and demurrage fees when containers were not available for pick up. BBB further alleges that in response to attempts to enforce their service contract, Yang Ming retaliated by further failing to meet BBB’s service contract commitments and threatening a refusal to deal unless BBB agreed to a minimum quantity commitment reduction. As a result, BBB alleges that it suffered $7.6 million in damages.

BBB requests the Commission order Yang Ming to pay BBB reparations for the unlawful conduct, including interest, attorneys’ fees, and costs, order Yang Ming to cease and desist from the unlawful conduct, and provide any other further relief that the FMC deems appropriate. BBB also requests the FMC double any reparations awarded due to Yang Ming’s alleged retaliatory conduct.

BBB filed a complaint against OOCL for similar alleged conduct in April 2023. BBB filed for Chapter 11 bankruptcy on April 23, 2023.

For more details visit FMC’s online reading room. The FMC’s reading room provides access to FMC dockets, related documents, notices, and orders.

Members of the West Coast Marine Terminal Operators Agreement (WCMTOA) announced that the PierPass fee will increase on November 1, 2023 by 4 percent, from USD 34.21 per TEU (twenty-foot equivalent unit), and USD 68.42 for all other container sizes, to USD 35.57 per TEU, and USD 71.14 per FEU (forty-foot equivalent unit), respectively.

This fee is called the PierPass Traffic Mitigation Fee (TMF) and applies for both day and night cargo, across all hours of operation. The TMF applies to non-exempt container; exempt containers include empty containers, import cargo or export cargo that transits the Alameda Corridor in a container and is subject to a fee imposed by the Alameda Corridor Transportation Authority, and transshipment cargo. Empty chassis and bobtail trucks are also exempt from the TMF.

PierPass does not set a fee for less than container load (LCL) shipments. Non-Vessel-Operating Common Carriers (NVOCCs) who impose a PierPass fee for LCL shipments and/or a PierPass handling fee must file these fees in their FMC tariff rules, or clearly note these in their tariff rates or NVOCC Negotiated Rate Arrangements (NRAs).

The Federal Maritime Commission (FMC) first authorized The West Coast Marine Terminal Operators Agreement (WCMTOA) under FMC Agreement No. 201143 in June 2003. In 2005 the WCMTOA was amended to allow its members to create PierPass, Inc. and implement the “OffPeak program” to reduce severe cargo-related congestion on streets and highways around the Los Angeles and Long Beach ports. OffPeak established regular weeknight night and Saturday work shifts to handle trucks delivering and picking up containers at marine terminals and implemented the PierPass TMF. In November 2018 FMC approved the change of the TMF to the current flat fee for container moves on all shifts, known as PierPass 2.0.

Several leading carriers serving the Transpacific container trades have recently updated their respective tariffs to include new General Rate Increases (GRIs) effective October 15, 2023, including CMA CGM, COSCO, Evergreen, Hapag Lloyd, HMM Company Limited, Ocean Network Express (ONE), Yang Ming, and ZIM. See table below for GRI amounts per 40ft container. GRI amounts for all other container sizes are as per formula. The October 15th GRIs will be the twentieth GRI of 2023 for the East Asia/USA trade lane.

NOTE 1:  CMA CGM GRIs will be USD 1000 per 40ft container for dry cargo, and USD 1125 per 40ft container for reefer cargo. GRI amounts for all other container sizes are as per formula.

NOTE 2:  COSCO GRIs apply on all cargo moving under service contracts only.

NOTE 3:  Evergreen GRIs will be USD 1000 per 40ft container for dry cargo, and USD 1000 per reefer container. GRI amounts for all other container sizes are as per formula.

Some carriers also updated their tariffs to include new General Rate Increases (GRIs) effective November 1, 2023, including CMA CGM, COSCO, Evergreen, Hapag Lloyd, HMM Company Limited, Ocean Network Express (ONE), Yang Ming, and Zim. See table below for GRI amounts per 40ft container. GRI amounts for all other container sizes are as per formula. The November 1st GRIs will be the twenty-first GRI of 2023 for the East Asia/USA trade lane.

NOTE 1:  CMA CGM GRIs will be USD 1000 per 40ft container for dry cargo, and USD 1125 per 40ft container for reefer cargo. GRI amounts for all other container sizes are as per formula.

NOTE 2:  COSCO GRIs apply on all cargo moving under service contracts only.

NOTE 3:  Evergreen GRIs will be USD 1000 per 40ft container for dry cargo, and USD 1000 per reefer container. GRI amounts for all other container sizes are as per formula.

Each carrier maintains its own tariffs and controls its own pricing.

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.