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FMC Investigating Apparently Inactive Vessel Carriers

Monday, November 14, 2011
Sandler, Travis & Rosenberg Trade Report

The Federal Maritime Commission has launched a proceeding that could lead to action against dozens of ocean common carriers for maintaining inaccurate or inactive tariffs. Initial responses from the named carriers are due no later than Dec. 7, and the FMC anticipates reaching a final decision by March 6, 2012.

Any ocean common carrier holding out to provide service in the United States foreign trades must keep open to public inspection in an automated tariff system tariffs showing all of its rates, charges, classifications, rules and practices between all points or ports on its own route and on any through route that has been established. Prior to the commencement of common carrier service pursuant to a published tariff, each common carrier must notify the FMC’s Bureau of Trade Analysis of the location of its tariff(s) and the publisher, if any, used to maintain its tariffs by electronically submitting form FMC-1 via the FMC Web site. A list of the locations of all carrier and conference tariffs submitted on form FMC-1 is published on this Web site, and this list is updated in real-time to permit any interested person to obtain tariff information and allow the FMC to assess carrier compliance with statutory tariff publication requirements.

Any changes in this information or the carrier’s name, organization number, home office address or telephone must be immediately transmitted to BTA. In addition, carriers and conferences must inform BTA in writing whenever a tariff is cancelled and the effective date of that cancellation.

However, a recent audit of the carriers in the FMC-1 database has revealed that dozens of carriers currently listed as active vessel-operating common carriers may in fact have ceased operations without notifying the FMC. The Commission is therefore ordering these carriers to show cause why it should not cancel their FMC-1 filings and order them to cease common carrier activities. The FMC notes that, among other things, it is seeking to ensure that that these carriers’ tariffs are not used as a means by which others may circumvent the bonding and licensing requirements applicable to non-vessel-operating common carriers.

Affidavits of fact and memoranda of law must be filed by the respondent carriers and any intervenors in support of them no later than Dec. 7. Reply affidavits and memoranda of law, as well as any request for an evidentiary hearing, are due no later than Dec. 22.

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