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Signals™ Headlines - September 7, 2004

FMC Fee Increase and Revision: Docket 04-11

The Federal Maritime Commission has proposed a revision and update of its existing
fees for (1) filing petitions and complaints; (2) various public information services,
such as record searches, document copying, and admissions to practice; (3) ocean
transportation intermediary (OTI) applications; (4) applications for special permission;
(5) service contract corrections; (6) agreements; and (7) passenger vessel
performance and casualty certificate applications. These revised fees reflect
current costs to the Commission. In addition, the Commission is proposing to
add a separate fee of $75 for the filing of terminal exempt agreements. This
new fee would reduce the current $138 fee. Because terminal exempt agreements
generally take less time to process than similar agreements between ocean carriers
the Commission has proposed this separate lower fee for terminal exempt agreements.
Docket 04-11 also makes revisions
to the Code of Federal Regulations (CFR) to reflect these fees and related changes.

The FMC’s current fee schedule has been in effect since July 15, 2002. The proposed revisions
include fee increases that reflect increased labor and processing costs, and some fee reductions.
The increases are based on cost analysis, and not a fixed percentage. The proposed new application
fee for a new OTI license will increase from $799 to $825. The fee for an OTI license amendment
application will increase from $506 to $525. Comments on the proposed new fees may be filed
with the FMC Secretary, and are due by Sept. 29, 2004.

FMC Announces Internal Realignment of Bureaus and Offices

The Federal Maritime Commission recently implemented a realignment of its key bureaus
and offices. On August 23, 2004 the FMC Office of the Executive Director, which previously
oversaw the Commission’s three program bureaus and four administrative offices, was
split into two separate offices: the Office of Administration and the Office of Operations.
Dr. Austin Schmitt now heads the Office of Operations with oversight of the three
program bureaus: the Bureau of Certification and Licensing (formerly the Bureau of
Consumer Complaints and Licensing); the Bureau of Enforcement; and the Bureau of
Trade Analysis. Dr. Schmidt is also directly in charge of the FMC Area Representatives
(formerly assigned to the Bureau of Enforcement). Mr. Bruce Dombrowski, formerly
the Executive Director, now heads the Office of Administration, overseeing the four
administrative offices: the Office of Budget and Financial Management; the Office of
Human Resources; the Office of Information Technology; and the Office of Management

Due to the rapid growth of the Commission’s programs for consumer complaints and
alternative dispute resolution these programs have been renamed the Office of Consumer
Affairs and Dispute Resolution Services. Ronald Murphy, Esq., is now director of this
office, which now reports to the FMC Office of the Secretary. The Bureau of
Certification and Licensing remains headed by Ms. Sandra Kusumoto and she is also
responsible for passenger vessel certifications, and licensing and financial
responsibility (bonding) requirements of entities regulated by the Commission.

This organizational realignment comes after several months of FMC review
into how the agency could best perform its duties in light of the changing
maritime industry. In an
FMC press release issued August 19, 2004
, Chairman Blust stated, “I am very
confident that our revised organizational setup
will serve our stakeholders more efficiently and responsively. Not only
will it provide an effective regulatory structure suitable for today’s
shipping industry, it will also allow us the flexibility necessary to
grow and change as the industry continues to evolve.”

Docket No. 04 -10: City of Portland, ME and Scotia Prince Cruises Agreement

An exclusive “docking and lease agreement” between the
City of Portland, Maine
and Scotia Prince Cruises Limited,
a Bermuda corporation, has come under investigation by
the FMC. Under the agreement, filed with the Commission on August 23, 2004, Scotia
Prince leases docking and terminal facilities from Portland for purposes of operating
a daily passenger and passenger vehicle service between Portland and Yarmouth, Nova Scotia.
The agreement contains exclusive use and non-compete provisions. These provisions have
prompted the Commission to issue an Order of Investigation and Hearing, Docket 04-10 to
investigate this agreement, which has been assigned FMC Agreement No. 201158.

According to
Docket 04-10
, in the agreement the City of Portland agrees not to allow
any other operator permission to use its terminal premises for passenger or passenger
vehicle service to or from Portland during Scotia Prince’s scheduled May through
October season. In return, Scotia Prince agrees not to operate in any competitive
passenger or passenger vehicle service between any other New England port and any
port in Nova Scotia.

This exclusive agreement appears to grants Scotia Prince a monopoly on passenger
and passenger vehicle service between Portland, Maine and all ports in Nova
Scotia, including Yarmouth. Under this agreement Portland is protected from
possible competition from Scotia Prince at any other New England port.
These restrictive provisions have raised concerns with the Commission
and Bay Ferries Limited, a passenger and passenger
vehicle line operating in the Maine and Canada areas has filed comments objecting to this agreement.
The Commission will investigate to determine whether the City of Portland,
Maine and Scotia Prince Cruises Limited are in violation of the Shipping Act.
An initial decision will be issued by August 23, 2005, and the final decision
will be issued by the FMC by Dec. 21, 2005.

Docket No. 04-08: Qin’s Incorporated and Superior Link International

Qin’s Incorporated has filed a complaint with the FMC against Superior
Link International, Inc. According to the complaint, filed August 10, 2004,
Qin’s alleges that Superior Link refuses to release two of Qin’s containers.
Qins claims due to this violation of the Shipping Act it has suffered
damages of $23,626. Qin’s asked the Commission to order Superior Link
to pay reparations, court costs, attorney’s fees and any other relief,
if the Commission finds this warranted. An initial decision in this
Docket No. 04-08 will be issued by the FMC’s Administrative Law Judge
by August 4, 2005.

Docket No. 04-09: American Warehousing and Port of NY & NJ

American Warehousing of New York, Inc. has filed a complaint with the
FMC against The Port Authority of New York and New Jersey. In the
complaint, filed August 18, 2004, American Warehousing claims that
the Port Authority has refused to negotiate a long-term extension
or renewal of their Marine Terminal Lease Agreement.
American Warehousing also claims it has suffered substantial
and ongoing economic damages. American Warehousing asked the
Commission to order the Port Authority to recommence negotiations
for a long-term extension of its lease, and to pay reparations
exceeding $15,000,000 per year, including interest, attorney
fees and any other damages as may be determined by the FMC.
An initial decision in this Docket 04-09 will be issued by
August 11, 2005.

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