House Bill Could Allow FMC to Bypass Court When Blocking Carrier, MTO Agreements

A new House bill could allow the Federal Maritime Commission to block certain “anticompetitive” agreements between ocean carriers and marine terminal operators without first having to secure a federal court order. Rep. John Garamendi, D-Calif., introduced the bill, called the Ocean Shipping Competition Enforcement Act, after FMC Commissioners Max Vekich and Carl Bentzel asked him to “make this critical change in federal law,” Garamendi said.

Although the FMC is required to review proposed agreements between ocean carriers or marine terminal operators to ensure they are “not unreasonably anticompetitive,” the commission can’t block an agreement without a court order, which can cause delays, Garamendi’s April 24 news release said. “If the court fails to act in time, then the agreement takes effect and automatically allows ocean liners and marine terminals to collude. No other independent federal regulatory agency is required to obtain court orders to enforce similar antitrust regulations,” Garamendi said. Congress must ensure the FMC “can do its job and fully enforce the law.”

Vekich said the bill would “simplify the process” under which the FMC reviews agreements, adding it’s “important” for the commission to “have the ability to determine when such agreements go too far and result in an unreasonable reduction in competition which produces an unreasonable decrease in service or increase in cost.” Bentzel said the legislation “provides a vital fix” and would make “this a much more efficient and accountable process.”

Garamendi said the bill was endorsed by the National Industrial Transportation League, the California Association of Port Authorities, the National Milk Producers Federation and the U.S. Dairy Export Council. The bill was introduced April 19 and referred to the House Committee on Transportation and Infrastructure and the Committee on the Judiciary.