64478 Federal Register / Vol. 83, No. 241 / Monday, December 17, 2018 / Rules and Regulations 

1Some authorities cited herein refer to § 41102(c) 

while others refer to section 10(d)(1). For ease of 

reading, we will generally refer to § 41102(c) in 

analyzing these authorities. 

2NPRM: Interpretive Rule, Shipping Act of 1984, 

83 FR 45367 (Sept. 7, 2018). 

3 In addition to its comments on the current 

interpretive rule, NYNJFFF&BA also encourages the 

Commission to review other prohibitions in § 41102 

as part of future interpretive rulemakings, alleging 

that its members have been subject to penalties for 

technical violations involving no injured parties 

and that these investigations do not serve the 

purposes of the Shipping Act of 1984. As 

NYNJFFF&BA notes, these issues are outside the 

scope of this rulemaking, but the Commission will 

consider these comments in determining whether to 

initiate future rulemakings. 

EPA-APPROVED INDIANA NONREGULATORY AND QUASI-REGULATORY PROVISIONS

Title Indiana date EPA approval Explanation 

*******

Section 110(a)(2) infrastructure requirements for the 1997 8-Hour Ozone 

NAAQS.

12/7/2007, 9/19/2008, 3/23/2011, 4/7/ 

2011, and 11/24/2017.

12/17/2018 [insert 

Federal Register citation].

All CAA infrastructure elements have 

been approved except the visibility 

portion of 110(a)(2)(D)(i)(II). 

Section 110(a)(2) infrastructure requirements for the 1997 PM2.5 NAAQS.12/7/2007, 9/19/2008, 3/23/2011, 4/7/ 

2011, and 11/24/2017.

12/17/2018 [insert 

Federal Register citation].

All CAA infrastructure elements have 

been approved except the visibility 

portion of 110(a)(2)(D)(i)(II). 

Section 110(a)(2) Infrastructure Requirements for the 2006 24-Hour PM2.5

NAAQS.

10/20/2009, 6/25/2012, 7/12/2012, 5/ 

22/2013, and 11/24/2017.

12/17/2018 [insert 

Federal Register citation].

All CAA infrastructure elements have 

been approved except the visibility 

portion of 110(a)(2)(D)(i)(II). 

Section 110(a)(2) Infrastructure Requirements for the 2008 8-Hour Ozone 

NAAQS.

12/12/2011 and 11/24/2017 ................. 12/17/2018 [insert 

Federal Register citation].

All CAA infrastructure elements have 

been approved except the visibility 

portion of 110(a)(2)(D)(i)(II) and a 

limited approval for 110(a)(2)(D)(i)(I). 

* * * * * * * 

[FR Doc. 2018–26920 Filed 12–14–18; 8:45 am] 

BILLING CODE 6560–50–P 

FEDERAL MARITIME COMMISSION 

46 CFR Part 545 

[Docket No. 18–06] 

RIN 3072–AC71 

Interpretive Rule, Shipping Act of 1984 

AGENCY: Federal Maritime Commission. 

ACTION: Final rule. 

SUMMARY: The Federal Maritime 

Commission (FMC or Commission) is 

revising its interpretation of the scope of 

the Shipping Act prohibition against 

failing to establish, observe, and enforce 

just and reasonable regulations and 

practices relating to or connected with 

receiving, handling, storing, or 

delivering property. Specifically, the 

Commission is clarifying that the proper 

scope of that prohibition in the 

Shipping Act of 1984 and the conduct 

covered by it is guided by the 

Commission’s interpretation and 

precedent articulated in several earlier 

Commission cases, which require that a 

regulated entity engage in a practice or 

regulation on a normal, customary, and 

continuous basis and that such practice 

or regulation is unjust or unreasonable 

in order to violate that section of the 

Shipping Act. 

DATES: This final rule is effective 

December 17, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Rachel E. Dickon, Secretary; Phone: 

(202) 523–5725; Email: secretary@

fmc.gov. 

SUPPLEMENTARY INFORMATION: 

I. Introduction 

Through this interpretive rule, the 

Federal Maritime Commission is 

clarifying its interpretation of the scope 

of 46 U.S.C. 41102(c) (section 10(d)(1) of 

the Shipping Act of 1984).1 Section 

41102(c) provides that regulated entities 

‘‘may not fail to establish, observe, and 

enforce just and reasonable regulations 

and practices relating to or connected 

with receiving, handling, storing, or 

delivering property.’’ This interpretive 

rule clarifies that in order to violate 

§ 41102(c), a regulated entity must 

engage in an unjust or unreasonable 

practice or regulation on a normal, 

customary, and continuous basis. 

II. NPRM and Summary of Comments 

On September 7, 2018, the 

Commission issued a Notice of 

Proposed Rulemaking (NPRM) seeking 

public comment on its proposed 

interpretation.2 Five comments were 

received in response to the NPRM, 

which may be found at the Electronic 

Reading Room on the Commission’s 

website at https://www.fmc.gov/18-06/. 

Comments were received from the 

American Association of Port 

Authorities (AAPA), New York New 

Jersey Foreign Freight Forwarders and 

Brokers Association (NYNJFFF&BA), 

World Shipping Council (WSC), 

International Trade Surety Association 

(ITSA) and National Customs Brokers 

and Forwarders Association of America 

(NCBFAA). All five comments received 

by the Commission were in support of 

the rulemaking. 

In their submission, AAPA affirms 

that the rule would bring the 

Commission’s interpretation of the 

Shipping Act’s prohibition on unjust 

and unreasonable practices and 

regulations in line with the plain 

language meaning of the word 

‘‘practice,’’ Commission precedent and 

the intent of Congress. AAPA does not 

believe that the rule would leave 

potential claimants without remedies, 

but that the rule would stop individual 

instances better suited for resolution 

under the Carriage of Goods by Sea Act 

(COGSA) or other venue from being 

brought to the Commission. 

NYNJFFF&BA also agrees that the 

intent of Congress and the plain 

language reading of § 41102(c) support 

this rulemaking. NYNJFFF&BA believes 

that without this rule, ocean 

transportation intermediaries (OTIs) are 

at risk of violating the Shipping Act 

over a single disagreement or accidental 

misstep, and this risk hinders 

resolutions through settlement. 

NYNJFFF&BA argues that this rule 

would limit the risk of frivolous claims 

being brought and allow OTIs to operate 

and settle claims more fairly and cost 

effectively. NYNJFFF&BA contends that 

claims that cannot be settled can still be 

brought through other venues.3

In its comment, WSC notes that from 

1935 to 2001, the Commission 

precedent was in line with the 


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4Houben v. World Moving Services, Inc., 31 

S.R.R. 1400 (FMC 2010). 

5Kobel v. Hapag-Lloyd A.G., 32 S.R.R. 1720, 1731 

(2013). 

6See 83 FR at 45368–45373. 

7Kamara v. Honesty Shipping Service, 29 S.R.R. 

321 (ALJ 2001). 

8See European Trade Specialists v. PrudentialGrace Lines, 19 S.R.R. 59, 63 (FMC 1979). 

9See Intercoastal Investigation, 1935, 1 U.S.S.B.B. 

400, 432 (1935). 

10See Whitam v. Chicago, R.I. & P. Ry. Co., 66 

F. Supp. 1014 (N.D. Tex. 1946). 

11See, e.g., Stockton Elevators, 3 S.R.R. 605, 618 

(FMC 1964); Intercoastal Investigation, 1935, 1 

U.S.S.B.B. at 432. 

12See Stockton Elevators, 3 S.R.R. at 618. 

13See Stockton Elevators, 3 S.R.R. at 618. See 

also, McClure v. Blackshere, 231 F. Supp. 678, 682 

(D. Md. 1964). 

14See 83 FR at 45370–45371. 

15See Total Fitness Equipment, Inc. d/b/a/ 

Professional Gym v. Worldlink Logistics, Inc., 28 

S.R.R. 45 (ALJ 1997); Brewer v. Maralan, 29 S.R.R. 

6 (FMC 2001). 

interpretation presented by this rule, but 

the Commission departed from this 

interpretation between 2010 and 2013. 

WSC believes that this rule will remove 

the uncertainty in the Commission’s 

precedent and interpretation of 

§ 41102(c). WSC argues that the rule 

will also meet the appropriate balance 

of encouraging meritorious Shipping 

Act cases and discourage matters that 

should be heard in other forums. WSC 

also does not believe that this 

interpretation will prevent would-be 

litigants from bringing meritorious 

claims and that parties will still be able 

to take advantage of the other forums 

that were used prior to the 2010 change 

in the Commission’s interpretation. 

ITSA also fully supports the 

Commission’s proposed interpretation 

of § 41102(c). ITSA states that adoption 

of this interpretation will not cause a 

barrier to claimants with legitimate 

disputes. ITSA asserts that this rule still 

allows claimants to seek resolutions 

through the claim procedures in 46 CFR 

515.23, the Commission’s ADR services, 

presenting a claim to an OTI’s surety or 

bringing an action in a proper legal 

venue. 

Finally, NCBFAA also supports the 

interpretive rule and believes that this 

rule will bring § 41102(c) back in line 

with its original purpose. NCBFAA 

believes that, as originally written, the 

term practice was not intended to refer 

to single instances and from 1935 to 

2010, Commission precedent supported 

this interpretation. NCBFAA argues that 

cargo owners will still possess ample 

civil remedies to resolve disputes. 

NCBFAA also emphasizes the 

importance of § 41102(c) for stopping 

systemic malpractices and believes that 

this rule will assist the Commission in 

returning their focus and priorities to 

the activities that negatively affect the 

broader shipping public. 

III. Final Rule 

For the reasons stated in the NPRM 

and by the commenters, the 

Commission is adopting the proposed 

interpretive rule without change. 

Section 41102(c) provides that regulated 

entities ‘‘may not fail to establish, 

observe, and enforce just and reasonable 

regulations and practices relating to or 

connected with receiving, handling, 

storing, or delivering property.’’ 

Beginning with the Houben 4 decision in 

2010 and presented in full in the 

Commission’s 2013 decision in Kobel v. 

Hapag-Lloyd,5 the Commission has held 

in a line of recent cases that discrete 

conduct with respect to a single 

shipment, if determined to be unjust or 

unreasonable, represents a violation of 

§ 41102(c). As discussed in the NPRM, 

this recent interpretation runs contrary 

to the original intent of Congress, the 

rules of statutory construction, and 

Commission precedent.6 This rule 

restores the Commission’s interpretation 

of § 41102(c) to its pre-2010 

understanding and returns the 

Commission’s focus and priorities to the 

activities of maritime regulated entities 

that negatively affect the broader 

shipping public. 

Section 41102(c) was never intended 

to be a method of resolving every 

dispute that arises in the receiving, 

handling, storing or delivering of cargo. 

In drafting the 1916 Act, and through its 

revisions and reenactment in 1984, 

Congress chose the word ‘‘practice’’ and 

the phrase, ‘‘establish, observe, and 

enforce just and reasonable regulations 

and practices,’’ to describe actions or 

omissions engaged in on a normal, 

customary, and continuous basis. From 

its origin and as recently as 2001,7

§ 41102(c) was interpreted in line with 

this understanding. To find a violation 

of § 41102(c), the Commission 

consistently required that the 

unreasonable regulation or practice was 

the normal,8 customary, often repeated,9

systematic,10 uniform,11 habitual,12 and 

continuous manner 13 in which the 

regulated common carrier was 

conducting business. This 

understanding as to what constitutes 

‘‘regulations and practice’’ under the 

Shipping Act is supported by multiple 

accepted rules of statutory 

construction.14

Through this rule, the Commission 

will return to an interpretation 

consistent with its precedent and 

consistent with rules of statutory 

construction. The Commission is aware 

that the interpretive rule may prevent 

some claims from being brought under 

the Shipping Act. Matters that may 

previously have been brought under 

§ 41102(c) however, can still find 

resolution in other provisions or 

regulations of the Shipping Act 15 or be 

adjudicated as matters of contract law, 

agency law, or admiralty law. The 

Commission believes that existing 

alternative avenues of redress are 

sufficient to address those cases. The 

Commission believes that this rule 

returns § 41102(c) to its proper purpose 

and allows the Commission to better 

meet its mission as intended by 

Congress. 

VI. Rulemaking Analyses 

Congressional Review Act 

The rule is not a ‘‘major rule’’ as 

defined by the Congressional Review 

Act, codified at 5 U.S.C. 801 et seq. The 

rule will not result in: (1) An annual 

effect on the economy of $100,000,000 

or more; (2) a major increase in costs or 

prices; or (3) significant adverse effects 

on competition, employment, 

investment, productivity, innovation, or 

the ability of United States-based 

companies to compete with foreignbased companies. 5 U.S.C. 804(2). 

Regulatory Flexibility Act 

The Regulatory Flexibility Act 

(codified as amended at 5 U.S.C. 601– 

612) provides that whenever an agency 

promulgates a final rule after being 

required to publish a notice of proposed 

rulemaking under the Administrative 

Procedure Act (APA) (5 U.S.C. 553), the 

agency must prepare and make available 

for public comment a final regulatory 

flexibility analysis (FRFA) describing 

the impact of the rule on small entities. 

5 U.S.C. 604. An agency is not required 

to publish a FRFA, however, for the 

following types of rules, which are 

excluded from the APA’s notice-andcomment requirement: Interpretive 

rules; general statements of policy; rules 

of agency organization, procedure, or 

practice; and rules for which the agency 

for good cause finds that notice and 

comment is impracticable, unnecessary, 

or contrary to public interest. See 5 

U.S.C. 553(b). 

Although the Commission elected to 

seek public comment, the rule is an 

interpretive rule. Therefore, the APA 

did not require publication of a notice 

of proposed rulemaking in this instance, 

and the Commission is not required to 

prepare a FRFA. 

National Environmental Policy Act 

The Commission’s regulations 

categorically exclude certain 


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64480 Federal Register / Vol. 83, No. 241 / Monday, December 17, 2018 / Rules and Regulations 

rulemakings from any requirement to 

prepare an environmental assessment or 

an environmental impact statement 

because they do not increase or decrease 

air, water or noise pollution or the use 

of fossil fuels, recyclables, or energy. 46 

CFR 504.4. This rule regards the 

Commission’s interpretation of the 

scope of 46 U.S.C. 41102(c) and the 

elements necessary for a successful 

claim for reparations under that section. 

This rulemaking thus falls within the 

categorical exclusion for matters related 

solely to the issue of Commission 

jurisdiction and the exclusion for 

investigatory and adjudicatory 

proceedings to ascertain past violations 

of the Shipping Act. See 46 CFR 

504.4(a)(20), (22). Therefore, no 

environmental assessment or 

environmental impact statement is 

required. 

Paperwork Reduction Act 

The Paperwork Reduction Act of 1995 

(44 U.S.C. 3501–3521) (PRA) requires an 

agency to seek and receive approval 

from the Office of Management and 

Budget (OMB) before collecting 

information from the public. 44 U.S.C. 

3507. The agency must submit 

collections of information in proposed 

rules to OMB in conjunction with the 

publication of the notice of proposed 

rulemaking. 5 CFR 1320.11. This rule 

does not contain any collections of 

information as defined by 44 U.S.C. 

3502(3) and 5 CFR 1320.3(c). 

Executive Order 12988 (Civil Justice 

Reform) 

This rule meets the applicable 

standards in E.O. 12988 titled, ‘‘Civil 

Justice Reform,’’ to minimize litigation, 

eliminate ambiguity, and reduce 

burden. 

Regulation Identifier Number 

The Commission assigns a regulation 

identifier number (RIN) to each 

regulatory action listed in the Unified 

Agenda of Federal Regulatory and 

Deregulatory Actions (Unified Agenda). 

The Regulatory Information Service 

Center publishes the Unified Agenda in 

April and October of each year. You 

may use the RIN contained in the 

heading at the beginning of this 

document to find this action in the 

Unified Agenda, available at http://

www.reginfo.gov/public/do/ 

eAgendaMain. 

List of Subjects in 46 CFR part 545 

Antitrust, Exports, Freight forwarders, 

Maritime carriers, Non-vessel-operating 

common carriers, Ocean transportation 

intermediaries, Licensing requirements, 

Financial responsibility requirements, 

Reporting and recordkeeping 

requirements. 

For the reasons set forth above, the 

Federal Maritime Commission amends 

46 CFR part 545 as follows: 

PART 545—INTERPRETATIONS AND 

STATEMENTS OF POLICY 

■ 1. The authority citation for part 545 

continues to read as follows: 

Authority: 5 U.S.C. 553; 46 U.S.C. 305, 

40307, 40501–40503, 41101–41106, and 

40901–40904; 46 CFR 515.23. 

■ 2. Add § 545.4 to read as follows: 

§ 545.4 Interpretation of Shipping Act of 

1984—Unjust and unreasonable practices. 

46 U.S.C. 41102(c) is interpreted to 

require the following elements in order 

to establish a successful claim for 

reparations: 

(a) The respondent is an ocean 

common carrier, marine terminal 

operator, or ocean transportation 

intermediary; 

(b) The claimed acts or omissions of 

the regulated entity are occurring on a 

normal, customary, and continuous 

basis; 

(c) The practice or regulation relates 

to or is connected with receiving, 

handling, storing, or delivering 

property; 

(d) The practice or regulation is unjust 

or unreasonable; and 

(e) The practice or regulation is the 

proximate cause of the claimed loss. 

By the Commission. 

Rachel E. Dickon, 

Secretary. 

[FR Doc. 2018–27181 Filed 12–14–18; 8:45 am] 

BILLING CODE 6731–AA–P 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

50 CFR Part 622 

[Docket No. 141104927–4927–01] 

RIN 0648–XG564 

Fisheries of the Caribbean, Gulf of 

Mexico, and South Atlantic; Reef Fish 

Resources of the Gulf of Mexico; 

Commercial Reef Fish Fishery of the 

Gulf of Mexico; 2019 Red Grouper 

Commercial Quota Retention 

AGENCY: National Marine Fisheries 

Service (NMFS), National Oceanic and 

Atmospheric Administration (NOAA), 

Commerce. 

ACTION: Temporary rule; withholding of 

red grouper allocation. 

SUMMARY: NMFS intends to withhold a 

portion of the red grouper commercial 

quota from the Individual Fishing Quota 

Program for Grouper and Tilefishes 

(IFQ) for the 2019 fishing year as a 

result of a proposed commercial quota 

reduction. The Gulf of Mexico Fishery 

Management Council (Council) 

requested that NMFS reduce the Gulf of 

Mexico (Gulf) red grouper commercial 

and recreational annual catch limits 

(ACLs) and associated annual catch 

targets (ACTs) through a temporary rule 

to provide increased protections to the 

stock. The commercial red grouper 

quota is equivalent to the commercial 

ACT. NMFS is currently evaluating the 

Council’s request and may implement, 

in early 2019, a temporary rule to 

reduce the red grouper ACLs and ACTs. 

Because red grouper is managed under 

an IFQ program, NMFS distributes IFQ 

allocation to the program shareholders 

on January 1 of each year. After NMFS 

distributes the applicable commercial 

quota to shareholders, it cannot be 

recalled. Therefore, in anticipation of 

the possible commercial quota 

reduction, NMFS will withhold 

distribution of 59.4 percent, equivalent 

to 4.78 million lb (2.17 million kg), 

gutted weight, of red grouper IFQ 

allocation on January 1, 2019. If the 

quota reduction is not implemented by 

June 1, 2019, the withheld quota will be 

distributed to the shareholders. This 

action is necessary to protect the red 

grouper resource and to effectively 

manage the IFQ program in 2019. 

DATES: This rule effective 12:01 a.m., 

local time, January 1, 2019, until 12:01 

a.m., local time, June 1, 2019. 

FOR FURTHER INFORMATION CONTACT: 

Peter Hood, telephone: 727–824–5305, 

or email: Peter.Hood@noaa.gov. 

SUPPLEMENTARY INFORMATION: The reef 

fish fishery of the Gulf includes red 

grouper and is managed under the 

Fishery Management Plan for the Reef 

Fish Fishery of the Gulf of Mexico 

(FMP). The FMP was prepared by the 

Council and is implemented by NMFS 

under the authority of the MagnusonStevens Fishery Conservation and 

Management Act (Magnuson-Stevens 

Act) by regulations at 50 CFR part 622. 

All weights in this temporary rule are 

in gutted weight. 

The current red grouper commercial 

ACT (commercial quota) is 7,780,000 lb 

(3,528,949 kg) and the commercial ACL 

is 8,190,000 lb (3,714,922 kg). Under the 

IFQ program for Gulf grouper and 

tilefish species, NMFS distributes 

allocation to shareholders on January 1 

each year. However, regulations at 50 

CFR 622.22(a)(4), authorize NMFS to 

withhold distribution of IFQ allocation 


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