Carriers Chastised for Restricting Chassis Choices

A recent decision by the Federal Maritime Commission could help ease the costs of transporting containerized imports between U.S. ports and inland facilities.

In February 2023 an FMC administrative law judge ruled that (1) ocean common carriers’ practice of designating an exclusive provider of chassis (the wheeled metal frames onto which containers are loaded) for port-to-port truck shipments violates U.S. shipping law, (2) the carriers’ practice of contractually linking their haulage rates to merchant haulage volume when there is no choice of chassis providers is also violative, and (3) the FMC has authority to order carriers not to withdraw from interoperable chassis pools. The trucking companies challenging these practices had argued that they unreasonably deprive the trucking companies of choice, stifle competition among chassis providers, and increase transportation costs for trucking companies, shippers, and the public in general.

The ocean carriers subsequently challenged the ALJ’s ruling but the FMC has upheld it, finding that the Commission “plainly has jurisdiction” over these claims and agreeing that the carriers’ practices are unreasonable. The FMC therefore reiterated the ALJ’s order for the carriers to cease and desist from designating exclusive chassis providers, enforcing rules that restrict trucking companies to those providers, and engaging in practices that lock in trucking companies to those providers.

This order currently applies only to four regions (Los Angeles/Long Beach, Chicago, Savannah, and Memphis) selected as a test case, but the FMC has remanded the dispute to the ALJ to resolve similar claims regarding other regions.