Background

The Federal Maritime Commission will be gathering information more frequently from the three global carrier alliances (2M, THE, and OCEAN) in an effort to better detect activity that might increase freight rates or decrease services.

The FMC states that one of its core functions is monitoring ocean carrier agreements to determine trends in the marketplace and the potential for illegal behavior. While the FMC monitors more than 300 such agreements, the three major global carrier alliances “are the top priority and receive the highest scrutiny” because they “have the greatest potential to cause or facilitate adverse market effects” due to their geographic scope and authority. As a result, the FMC monitors key economic indicators and changes to underlying market conditions for alliance agreements to detect any joint activity by agreement members that might raise and maintain freight rates above competitive levels or unreasonably decrease services.

To accomplish this monitoring the FMC has traditionally relied on a combination of data confidentially provided by individual vessel operators and commercially-available industry data. However, given recent fluctuations in the markets, the FMC said it needs to receive this data more frequently. The FMC has therefore directed the three alliances to file certain carrier-specific trade data monthly instead of quarterly.

Chairman Michael Khouri said that if its monitoring detects any indication of violative carrier behavior the FMC will first seek to address concerns with direct carrier discussions but could also seek a federal court injunction against further operation of the alliance agreement.

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