FMC to Begin Process on OTI Regulation Revision, Market Index, Etc.

HOLLYWOOD, Fla. -- Industry can expect a revision to ocean transportation intermediaries (OTI) regulation and a request for comments on a Federal Maritime Commission (FMC) market rate index, said FMC General Counsel Rebecca Fenneman, speaking at the National Customs Brokers and Forwards Association of America convention April 24, 2012. Fenneman didn’t go into detail on the potential changes but noted they were items the FMC was considering.

The OTI changes are likely part of a executive agency-wide review of unnecessary regulations. The FMC has previously said it was considering using FMC data to develop a container shipping rate index for a few targeted agricultural export commodities. See ITT’s Online Archives 12031217 for summary of the potential FMC rate index.)

Fenneman spoke a bit about the agency’s recent request for comments on improving rules that exempt non-vessel-operating common carriers (NVOCCs) who enter into service arrangements from certain tariff filing requirements of the Shipping Act of 1984. Especially important is the consideration of jointly offered NVOCCs Service Arrangements (NSAs), she said. In 2005, the FMC had a similar notice of inquiry on the ability of NVOCCs to jointly offer NSAs. Antitrust concerns held back that effort but a recent court decision has made the new consideration possible, said Fenneman.

Fenneman said there are four enforcement investigations in which transporters allegedly illegally acted as NVOCCs without a license. With the coming relaxation of NVOCC regulations, more enforcement action on operators that are acting in total noncompliance with FMC regulation may increase, she said. The FMC is also doing a full review of its regulations, as requested by the Obama administration. The FMC released its plan last year for a retrospective review of its existing rules pursuant to Executive Order 13579, which requires agencies to periodically review their significant regulations to determine if any need to be repealed, streamlined or expanded. (See ITT’s Online Archives 11110736 for summary of FMC’s planned regulations review.)

First Phase of Panama Canal Expansion Study to Conclude Soon

A number of steps remain within the Transportation Department’s Maritime Commission’s study on the Panama canal expansions, said Bill Paape, director of the Inland Waterways Gateway Office at the DOT, speaking at the same conference. The expansions will create a number of improvements, but also challenges, which make the study so important, he said. The most significant change will be the doubling of capacity and the addition of new locks to allow larger container ships to pass through.

There are five separate phases within the study, with the first phase of reaching out to industry stake holders expected to finished this spring, Paape said. Once each phase is completed, it will be released, he said. The transit surcharge for using the canal hasn’t been finalized, he said. Panama is looking at its options on rates, he said. He said Panama is looking at the expansion as a development zone and the pricing will reflect that.