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Port of NY/NJ Cargo Charge Discussion Agreement to Take Effect Despite Concerns

Monday, June 26, 2017
Sandler, Travis & Rosenberg Trade Report

An agreement allowing the Port of New York and New Jersey and the Ocean Carrier Equipment Management Agreement to discuss matters related to the cargo facility charge the PANYNJ implemented in 2011 will take effect June 25. The two sides plan to use the agreement to discuss an alternative billing and collection system for this charge.

According to a press release from the Federal Maritime Commission, two commissioners expressed concern about the significant market share that OCEMA members and individual carriers control at these ports and voted to seek additional information that would assist the FMC in fully assessing the competitive effects and consequences of the agreement. Two others voted to allow the agreement to take effect without further information, preventing the majority vote required for the FMC to take action.

Commissioner Dan Maffei said he voted to allow the agreement to take effect because it does not appear likely to cause an unreasonable increase in transportation costs or decrease in transportation services through a reduction in competition, which is the statutory criterion. However, he suggested that the agreement is “unfair, inefficient, even foolish” and said it appears to be “the result of ocean carriers … bullying a public port authority … in an effort to shift financial responsibility for the CFC away from themselves and onto third parties.”

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