Federal Maritime 

Commission

Fiscal Year 2018 

Budget Request

July 2017

Revised

To be submitted to the Appropriations Committees 

(Subcommittees on Transportation, Housing and 

Urban Development, and Related Agencies)

Acting Chairman Michael A. Khouri
FY 2018 Budget Request FINAL

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Table of Contents

Our Mission and Goals.....................................................................................................................................2

Overview of the FMC.......................................................................................................................................3

Our Organization...............................................................................................................................................5

Proposed Appropriation Language; Salaries and Expenses ........................................................................8

Fiscal Year 2018 Budget Request ....................................................................................................................9

FMC Strategic Plan and the FY 2018 Budget Request..........................................................................10

Strategic Goal 1: Maintain an efficient and competitive international ocean 

transportation system.............................................................................................................................13

Strategic Goal 2: Protect the public from unlawful, unfair, and deceptive 

practices and resolve shipping disputes...............................................................................................14

Commission Action Items – Supporting the President’s Management Agenda and 

Government-wide Priorities..................................................................................................................16

FY 2016 Accomplishments............................................................................................................................22

Strategic Goal 1: Maintain an efficient and competitive international ocean 

transportation system.............................................................................................................................22

Strategic Goal 2: Protect the public from unlawful, unfair and deceptive practices 

and resolve shipping disputes ...............................................................................................................25

Additional 2016 Accomplishments...........................................................................................................28

Information Technology........................................................................................................................28

Representative Rulemakings, Adjudications, and Litigation.............................................................28

Appendices........................................................................................................................................................31
FY 2018 Budget Request FINAL

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Our Mission and Goals

Competition and Integrity for America’s 

Ocean Supply Chain 

 

The FMC’s mission is to ensure a competitive and 

reliable international ocean transportation supply 

system that supports the U.S. economy and protects 

the public from unfair and deceptive practices. 

 

 

The FMC’s 2014-2018 Strategic Plan calls for 

achieving its mission by fulfilling two goals: 

• Maintain a competitive international ocean 

transportation supply system.

• Protect the public from unlawful, unfair, and 

deceptive practices.
FY 2018 Budget Request FINAL

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Overview of the FMC

The Federal Maritime Commission (FMC or Commission) is an independent agency responsible for 

the regulation of oceanborne transportation in the foreign commerce of the United States for the 

benefit of U.S. exporters, importers, and consumers. The Commission is directed by five 

Commissioners appointed for staggered five-year terms, with one Commissioner designated by the 

President to serve as Chairman. The Chairman is the Chief Executive and Administrative Officer of 

the agency. Under a recent statutory change, Commissioners appointed and confirmed after 

December 18, 2014 may serve no more than two terms.

Congress has charged the FMC with a number of oversight responsibilities designed to ensure 

competitive and efficient ocean transportation services for the shipping public, and to protect the 

public from unfair and deceptive practices. The principal statutes administered by the Commission, 

now codified at 46 U.S.C. §§ 40101-44106, are:

• The Shipping Act of 1984, as amended by the Ocean Shipping Reform Act of 1998 (Shipping 

Act)

• The Foreign Shipping Practices Act of 1988 (FSPA)

• Section 19 of the Merchant Marine Act, 1920 (1920 Act)

• Sections 2 and 3 of Pub. L. No. 89-777, 80 Stat. 1350

The FMC ensures competitive and efficient ocean transportation services for the shipping public by:

• Reviewing and monitoring agreements among and between ocean common carriers and 

among and between marine terminal operators (MTOs) serving the U.S. foreign oceanborne 

trades to ensure that they do not cause unreasonable increases in transportation costs or 

decreases in transportation services;

• Maintaining and reviewing confidentially filed service contracts and Non-Vessel-Operating 

Common Carrier (NVOCC) Service Arrangements to guard against detrimental effects to 

shipping;

• Providing a forum for exporters, importers, and other members of the shipping public to 

obtain relief from ocean shipping practices or disputes that impede the flow of commerce;

• Ensuring common carriers’ tariff rates and charges are published in private, automated tariff 

systems and electronically available;

• Monitoring rates, charges, and rules of government-owned or -controlled carriers to ensure 

they are just and reasonable; and

• Taking action to address unfavorable conditions caused by foreign government or foreign 

business practices in U.S. foreign shipping trades.

The FMC engages in a variety of activities that protect the public from financial harm, and contribute 

to the integrity and security of the Nation’s import and export supply chains and ocean transportation 

system. These activities include:

• Licensing and registering ocean transportation intermediaries; 

• Helping resolve disputes about the shipment of goods or the carriage of passengers;
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• Administering and enforcing a surety bond program to ensure payment of judgments for 

damages by NVOCCs and freight forwarders;

• Investigating and prosecuting violations of the Shipping Act and other statutes referenced 

above;

• Adjudicating private party complaints alleging Shipping Act violations; and

• Ensuring that passenger vessel operators maintain proper financial coverage to reimburse 

cruise passengers in the event their cruise is cancelled or to cover liability in the event of death 

or injury at sea.
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COMMISSIONER CHAIRMAN COMMISSIONER COMMISSIONER

Office of the 

Inspector 

General

Office of Equal 

Employment 

Opportunity

Office of the 

Managing 

Director

COMMISSIONER

Office of the 

General 

Counsel

Office of the 

Secretary

Office of 

Administrative 

Law Judges

Office of

Consumer 

Affairs & Dispute 

Resolution 

Services

Office of 

Budget and 

Finance

Office of 

Human 

Resources

Office of 

Management 

Services

Office of 

Information 

Technology

Bureau of 

Certification and 

Licensing

Bureau of 

Enforcement

Bureau of Trade 

Analysis

Area Representatives

Houston 

Los Angeles 

New Orleans 

New York/New Jersey Seattle/Tacoma 

South Florida

FEDERAL MARITIME COMMISSION 

ORGANIZATION CHART 

Administrative

Technical
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Our Organization

The FMC’s staff is comprised of economists, attorneys and experts in ocean transportation and 

government administration. While most of the Commission’s workforce is located at its Washington, 

D.C. headquarters, the Commission maintains a presence in six major port locations nationwide. 

In addition to its Commissioners’ offices, the Commission is organized into bureaus and offices to 

accomplish its mission:

Area Representatives (ARs): Stationed in six 

strategic locations, the ARs represent the FMC

and serve major ports and transportation centers 

within their respective areas and beyond. The 

ARs facilitate the flow of information to and 

from the maritime industry and the shipping 

public, resolve complaints and disputes between 

parties involved in international oceanborne 

shipping (often coordinating with our office of 

Consumer Affairs and Dispute Resolution 

Services), investigate alleged violations of 

shipping statutes, and function as an intelligence 

resource. They provide advice and guidance to 

the shipping public, collect and analyze 

information of regulatory significance, and assess 

industry conditions. The ARs frequently 

cooperate and coordinate with other Federal, 

state and local governmental agencies, providing 

shipping expertise and information. The ARs 

educate the public on FMC regulations and 

services at industry seminars and conferences as 

well as prepare and give presentations through 

local community contacts. 

Bureau of Certification and Licensing (BCL): BCL 

is responsible for the Passenger Vessel Certification and Ocean Transportation Intermediary 

programs. BCL is composed of two offices, the 

Office of Passenger Vessels and Information 

Processing and the Office of Transpor-tation 

Intermediaries.

Bureau of Enforcement (BOE): BOE is the 

prosecutorial arm of the Commission. Bureau 

attorneys participate as trial counsel in formal 

proceedings, and work closely with the 

Commission’s Area Representatives in investigations of potential violations of the Shipping Act 

and Commission regulations. BOE negotiates 

settlements and informal compromises of civil 

penalties, and may act as investigative officers in 

formal fact-finding investigations initiated under 

the Shipping Act or the FSPA.

Bureau of Trade Analysis (BTA): BTA reviews 

agreements and monitors the concerted activities 

of ocean common carriers and marine terminal 

operators under the standards of the Shipping 

Act. BTA is responsible for competition 

oversight and market analysis, focusing on 

activity that is substantially anti-competitive 

under the standards of 6(g) of the Shipping Act. 

BTA also reviews and analyzes service contracts, 

monitors rates of government-owned controlled 

carriers, reviews carrier-published tariff systems 

under the accessibility and accuracy standards of 

the Shipping Act and responds to inquiries or 

issues that arise concerning service contracts or 

tariffs. 

Office of the Administrative Law Judges 

(OALJ): The OALJ resolves cases of alleged 

violations of the Shipping Act and other laws 

within the Commission’s jurisdiction.

Office of Consumer Affairs and Dispute Resolution 

Services(CADRS): CADRS provides assistance to 

shippers, ocean transportation intermediaries, 

cruise operators and passengers, truckers, marine 

terminal operators, and vessel-operating 

common carriers (VOCCs) by providing 

alternative dispute resolution services, ombuds 

assistance, mediation, facilitation, and arbitration to resolve disputes involving cargo 
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shipments, household goods shipments, and 

cruises.

Office of Equal Employment Opportunity 

(OEEO): The OEEO advises and assists the 

Commission in carrying out its responsibilities 

relative to Titles VI and VII of the Civil Rights 

Act of 1964 (as amended), other laws, executive 

orders, and regulatory guidelines affecting 

affirmative employment, and the processing of 

EEO complaints.

Office of the Inspector General (OIG): The OIG is 

an independent and objective oversight office 

created within the FMC by the Inspector’s 

General Act of 1978 (as amended) to conduct 

and supervise audits, inspections, and investigations relating to FMC programs; detect and 

prevent waste, fraud and abuse; promote 

economy, efficiency, and effectiveness; review 

existing and proposed legislation and regulations; 

keep the Chairman, Commissioners, and 

Congress fully informed of serious problems and 

deficiencies and recommend corrective actions; 

and report violations of law to the U.S. Attorney 

General.

Office of the General Counsel (OGC): The OGC 

provides legal services to the Commission. Key 

responsibilities include: providing advice and 

recommendations; preparing final decisions, 

orders and regulations for Commission approval 

and issuance; representing the Commission in 

litigation before the courts; representing the 

Commission’s interests in matters before 

Congress; providing technical and policy 

assistance to other government agencies engaged 

in international negotiations or discussions on 

shipping matters; and providing legal opinions to 

the Commission, its staff, and the general public 

in appropriate instances. OGC also oversees the 

Commission’s international affairs activities.

Office of the Managing Director (OMD): The 

OMD is responsible for implementing the 

administrative directives of the Chairman, the 

management and coordination of Commission 

Bureaus, and overseeing the agency’s Area 

Representatives. It has direct oversight of the 

administrative offices of the Commission, which 

include the Offices of Budget and Finance, 

Human Resources, Information Technology, 

and Management Services.

Office of the Secretary (OS): The OS serves as the 

focal point for all matters and documents 

submitted to and emanating from the 

Commission. It receives and processes a variety 

of documents in regulatory and administrative 

proceedings; as well as subpoenas served on the 

Commission or its members. The OS is 

responsible for preparing and submitting regular 

and notation agenda matters for consideration by 

the Commission, and preparing and maintaining 

the minutes of actions taken on these agenda and 

notation matters; maintaining official files and 

records of all formal proceedings; issuing orders 

and notices of actions of the Commission; 

compliance with Freedom of Information, 

Government in the Sunshine and Privacy Acts; 

responding to information requests from the 

public; issuing publications and authenti-cating 

instruments and documents of the Commission; 

publishing Commission historical decisions; 

maintaining a Public Reference/Law Library and 

a Docket Library; and overseeing the 

organization and content of the Commission’s 

website.
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Proposed Appropriation Language: Salaries and Expenses

For necessary expenses of the Federal Maritime Commission as authorized by section 201(d) of the 

Merchant Marine Act, 1936, as amended (46 U.S.C. §307), including services as authorized by 5 U.S.C. 

§3109; hire of passenger motor vehicles as authorized by 31 U.S.C. §1343(b); and uniforms or allowances 

therefore, as authorized by 5 U.S.C. §§5901 - 5902, $27,490,000 $26,149,000: Provided, That not to 

exceed $2,000 shall be available for official reception and representation expenses. (Consolidated 

Appropriations Act, 2017).
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Fiscal Year 2018 Budget Request

The FMC’s Fiscal Year (FY) 2018 Budget Request is $26,149,000 to support 127 full-time equivalent

(FTE) employees. This is a net decrease of $1,341,000 from the Commission’s FY 2017 President’s 

Budget level. Although the budget request is relatively small, the Commission has a large mandate, and 

plays a vital role in international commerce. This budget request has, wherever possible, considered 

cutbacks to spending while maintaining the performance and quality of the FMC’s mission and 

programs. 

The Commission will realize a net reduction in personnel costs of $220,896 due to staff reductions 

through attrition. In addition, the Commission has reduced official travel by $70,000, contractor support 

by $526,426 and commercial services by $204,472 while realizing increased costs for GSA rent of 

$172,200. The reduction in administrative expenses includes cuts in the Commission’s Information 

Technology (IT) infrastructure investments. However, the Commission had previously prioritized 

improving its IT systems through a multiyear project, currently underway, to greatly improve its 

efficiency, reliability and cybersecurity readiness. When fully implemented, these investments will 

enhance the Commission’s internal business processes, expand research and analysis capabilities and 

provide better public accessibility to FMC information. The FMC’s transition to Enterprise Content 

Management (ECM) technology is on target to drastically streamline the stakeholder application 

handling/registration processes. The new technology will enable instant access to documents, data, and 

the real-time status of applications, licenses and registrations. It will also provide a modern and efficient 

business process for applicants and staff, thereby saving time and money while also enabling the FMC 

to keep pace with the electronic business practices of the industry it serves.

The FY 2018 request reduces the FY 2017 projected workforce by seven FTEs. The FMC’s dedicated 

workforce plays a vital role in the Commission’s continuing success in maintaining an efficient and 

competitive international ocean transportation system and protecting the public from unlawful, unfair 

and deceptive practices. The FMC continues to use internal agency teams to improve workplace 

satisfaction while increasing productivity. 

This budget request chiefly covers estimated costs for mandatory operational needs. As depicted in the 

following chart, 98% of the FMC’s FY 2018 Budget Request provides for payroll expenses, mandatory 

rent, telephones, interagency services, and important commercial contracts. The remaining 2% covers 

supplies and equipment (including IT hardware and software), and official travel. Funding resources 

needed for FY 2016 through FY 2018 by object class are provided in Appendix C. Compensatory 

reductions have been made wherever possible. The Commission must continue to invest in missioncritical technologies (both software and hardware) if it is to effectively and efficiently carry out its 

statutory duties.
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The FY 2018 Budget Request includes a number of graphs and tables which explain the funding and 

FTE resources needed to meet the Commission’s mission and statutory mandates. Appendices A and 

B provide detailed funding and FTE requirements at the program level. Appendix C categorizes the 

funding resources needed for FY 2016 through FY 2018 by object class. Appendix D provides funding 

by program areas and the relationship of the Commission’s Obligations to Outlays by fiscal year.

Appendix E details the FMC’s Strategic Goals, Objectives and Performance Measures. Appendix F 

provides the Commission’s Workload Summary statistics, Appendix G is an Evidence Submission for 

agency decision making, and Appendix H is the Certification of the Office of the Inspector General’s 

FY 2018 Budget Request.

FMC Strategic Plan and the FY 2018 Budget Request

Over the past five decades, international ocean transportation has changed dramatically. The FMC, an 

independent expert agency charged with regulating liner shipping in the U.S. trades, has adapted to and 

evolved with those changes. From its statutory reorganization in 1961, the FMC has worked to further 

its mission to foster a fair, efficient, and reliable international ocean transportation system for the benefit 

of U.S. exporters, importers, and consumers. While the specifics of U.S. maritime policy and legislation 

have changed markedly during the last few decades, the FMC’s goal of protecting American exporters, 

importers and end consumers remains the cornerstone of today’s regulatory efforts. Consequently, the 

Commission’s Strategic Plan focuses on the goals of maintaining a competitive international ocean 

transportation system for U.S. exporters and importers and protecting the shipping public from financial 

harm. 
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The Commission supports the President’s Management Agenda and government-wide initiatives by 

working to increase efficiencies and customer service initiatives, transparency, and by providing public 

access to information to make a positive difference in the lives of the American people and the economy. 

The FMC’s mission supports the President’s commitment to economic growth and job creation. 

The Commission regularly provides outreach and education to the shipping industry, stakeholders, and 

other government entities on the statutes it implements, and to address any issues that may arise. 

Commissioners and staff address various industry and stakeholder groups as speakers and panelists to 

provide information on the latest issues related to Commission activities.

The Commission has two strategic goals. The first goal – maintain a competitive international ocean 

transportation supply system – encompasses the critical tasks of reviewing and monitoring carrier and MTO 

agreements, and monitoring foreign shipping practices. The second goal – protect the public from unlawful, 

unfair, and deceptive practices – encompasses a broader mandate to protect the shipping public. As reflected 

in the table below, of the total FY 2018 request, $6,476,991 and 30.42 FTEs are needed to support 

Strategic Goal 1. Strategic Goal 2 support requires $19,672,009 and 96.58 FTEs. Commission-wide 

action items, addressed on page 17, identify the FMC’s ongoing commitment to support the President’s 

Management Agenda by continually looking to improve its operational infrastructure as well as the 

availability of informational resources for the benefit of public and industry stakeholders.

FY 2016 FY 2017 FY 2018

Actual Enacted Request

FTE: Headquarters & Field 122.52 124.48 127.00

Cost: Salaries & Benefits $18,369,630.13 $20,014,000.00 $19,793,104.00

Non-Personnel Expenses $7,204,645.26 $7,476,000.00 $6,355,896.00

Total Cost $25,574,275.39 $27,490,000.00 $26,149,000.00

Federal Maritime Commission

FY 2018 Cost by FMC Strategic Goal

Strategic Goal 2

Protect the public from unlawful, unfair and 

deceptive practices and resolve shipping disputes 

96.58

Strategic Goal 1

Maintain an efficient and competitive international 

ocean transportation system

30.42

$6,476,991.46

Executive Summary

FY 2018 FTE by FMC Strategic Goal

Strategic Goal 2

$19,672,008.54

Strategic Goal 1
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The Commission is committed to integrating evidence into its strategic decision-making, and tracking 

its progress through performance metrics. An evidence submission demonstrating the FMC’s progress 

is included in Appendix G. 

Strategic Goal #1 

$6,476,991

Strategic Goal #2 

$19,672,009

Funding Request by Strategic Goal

Maintain a competitive 

international ocean 

transportation supply 

system

Protect the public from unlawful, 

unfair, and deceptive ocean 

transportation practices

Strategic Goal 

#1 

30.42

Strategic Goal 

#2 

96.58

FTE Request by Strategic Goal

Maintain a competitive 

international ocean 

transportation supply 

system

Protect the public from unlawful, 

unfair, and deceptive ocean 

transportation practices
FY 2018 Budget Request FINAL

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Strategic Goal 1: 

Maintain a competitive international ocean transportation supply system 

Objective: Enhance efficiency in the trades through the use of asset sharing authority under the Shipping Act of 

1984

Competition under the FMC’s Authority

The Commission reviews and monitors carrier and MTO agreements to enhance trade efficiency 

through the use of various types of agreement authority. The Commission estimates that it will receive 

260 agreement filings in 2017, and that 255 will be filed in FY 2018 (see Appendix F for these and other 

workload statistics). The filed agreements included amendments to existing agreements and terminations 

of existing agreements. The Commission reviewed, evaluated, and processed 250 filings during FY 2016, 

including those pending at the end of the prior fiscal year.

Significant changes in the ocean carrier industry, notably related to consolidations and a notable 

bankruptcy, have resulted in changes to the composition of operational alliances. Implementation of 

carrier consolidations is ongoing, and will continue to impact existing and future filed agreements. In 

particular, the merger of COSCO and China Shipping Container Lines, and the purchase of APL by 

CMA CGM, necessitated several amendments to existing agreements, and resulted in plans for the 

formation of a new alliance, the OCEAN Alliance, consisting of COSCO, CMA CGM, Evergreen, and 

OOCL. The OCEAN Alliance agreement was implemented in early 2017. Leading up to the proposed 

implementation there were substantial changes to existing alliances, as COSCO and Evergreen exited

the CKYHE Alliance, and OOCL and APL left the G6 Alliance. Also, the CKYHE Alliance 

unexpectedly lost one of its five members when Hanjin Shipping, the seventh largest liner operator in 

the world at the time, filed for bankruptcy in September 2016. Beyond the devastating impact which

reverberated throughout the supply chain and the maritime industry as a whole, the Hanjin Shipping 

Bankruptcy alsocreated uncertainty regarding its impact on the spring 2017 reconfiguration of global 

ocean carrier alliancesWith the industry in the process of significant structural change, the FMC will 

continue to play an important role in analyzing agreements for anticompetitive practices, overseeing the 

changes and monitoring the impact on the Nation’s exporters/importers to ensure goods reach 

international markets efficiently and effectively.

Operationally, FY 2016 saw great progress in the development and deployment of the new eAgreements 

system, which provides for the electronic filing of agreements and updates the review and online 

publication process for filed agreements at the Commission. This effort involved development of the 

infrastructure for this system, and the transfer of agreement content from the legacy database to the 

newly developed system. FMC spent significant time working with stakeholders to ensure that system 

functionality met their needs. As part of this effort, staff engaged in a comprehensive audit of 

agreements on file to ensure that when the new system was deployed, it reflected an accurate and up-todate representation of agreements currently in effect within the ocean transportation industry. As a 

result of this audit, FY 2016 saw a larger-than-average number of agreement terminations as staff 

identified and requested termination of agreements that were no longer in use or valid. Going forward, 

the system will be reviewed to enhance external users’ filing processes as well as streamline internal 

business processes and expand research capabilities. 

In FY 2016, the Commission created and implemented a Supply Chain Innovation Project led by 

Commissioner Rebecca Dye, to bring together industry leaders from across the international ocean 

transportation supply chain to discuss challenges, collaborate on solutions to help reduce port 

congestion, and remove related obstacles to efficient U.S. supply chain operations. On May 3, 2016, the 
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Commission held a two-day inaugural team meeting. The three teams are each composed of industry 

leaders who, under FMC authority and oversight, conduct non-public discussions aimed at identifying 

and implementing actionable processes to improve supply chain visibility and better integrate the various 

transportation and logistics actors involved. Industry participants include ports, terminal operators, 

major shippers, ocean transportation intermediaries, port labor, railroads, truckers, and chassis providers. 

In FY 2017, Commissioner Dye will organize three additional Supply Chain Innovation Teams to focus 

on challenges and solutions for the U.S. export trades.

In FY 2017 and FY 2018, the Commission will continue to monitor service contract, tariff, and 

agreement activities, prepare reports and economic analyses on developments and issues in key U.S. 

trades, review the activities of controlled carriers, and respond to inquiries and informal complaints. The 

FMC will continue to monitor key U.S. trade lanes. The FMC will review and analyze the competitive 

impact of agreements and monitor the activities of agreement parties, particularly focusing on issues of 

vessel capacity and equipment availability. In addition, the Commission will continue to monitor changes 

taking place in the provision of chassis for the inland movement of containerized goods and the 

competitive effects of changing carrier alliance structures. 

Strategic Goal 2: 

Protect the public from unlawful, unfair, and deceptive practices

Objective 1: Identify and take action to end unlawful, unfair and deceptive practices 

The Commission uses both its enforcement and compliance programs to identify and take action to end 

unlawful, unfair and deceptive practices. Major investigations undertaken or completed during FY 2016 

addressed ongoing practices of certain OTIs operating in the volatile China-U.S. inbound trades, as well 

as VOCCs seeking to operate pursuant to agreements that were not filed with the Commission. 

Enforcement-based initiatives will continue against VOCCs and NVOCCs that engage in unfair service 

contracting practices, particularly those practices which permit unlicensed OTIs to compete unlawfully 

with carriers and OTIs operating in compliance with U.S. laws. The FMC will pursue enforcement 

actions against those who pursue market-distorting, fraudulent, or anti-competitive practices harmful to 

the industry and the public.

In FY 2016, the compliance audit program continued as a major focus. This program, conducted from 

headquarters primarily by mail, e-mail and telephone, reviews the operations of licensed OTIs to assist 

them in complying with the statutory requirements and the Commission’s rules and regulations. The

audit program also reviews entities holding themselves out as VOCCs, where there is no indication of 

actual vessel operations. During the fiscal year, 223 audits were commenced, 208 audits were completed, 

and 15 remained pending on September 30, 2016. 

During the fiscal year, the Commission completed notable compromise agreements with several of the 

major NVOCCs serving the inbound Far East-US trades, addressing a variety of service contracting 

malpractices. The Commission continued investigations relating to unfiled carrier agreements in the 

U.S.-foreign trades, both inbound and outbound. Penalties were collected against one smaller carrier 

for operating under unfiled space charter agreements affecting its roll on/roll off operations. Further 

settlements with vessel-operating carriers are expected.

The FMC is active in security initiatives as they relate to U.S. ocean commerce. The Commission works 

to coordinate the use of available database systems with other agencies engaged in homeland security to 

improve identification of entities providing and utilizing maritime transportation services. To facilitate 
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these activities, the FMC executed a Memorandum of Understanding (MOU) with the U.S. Customs 

and Border Protection to provide a more efficient utilization of existing systems and services. The FMC 

also has an active MOU with the Census Bureau, U.S. Department of Commerce, to provide the FMC 

with access to the Census’ Automated Export System (AES) database. These relationships allow the 

FMC to access confidential U.S. export shipment data to accomplish its mission and to protect the 

Nation’s security interests. The Commission also supports the Nation’s economic and security interests 

by partnering with the National Intellectual Property Rights Coordination Center (IPR Center), a 

Department of Homeland Security-led partnership of 23 Federal and international agencies targeting 

intellectual property- and trade-related crimes. This partnership has resulted in coordinated enforcement 

efforts to address international criminal activity. 

Objective 2: Prevent public harm through licensing and financial responsibility requirements 

Ocean transportation intermediaries (OTIs) are transportation middlemen for oceanborne cargo moving 

in the U.S.-foreign trades. Before the FMC grants licenses to OTIs as mandated by the Shipping Act, 

the OTI applicant must establish that it has the necessary character and a minimum of three years of 

experience in the U.S., as well as establish its financial responsibility by means of a bond, insurance, or 

other instrument. 

Approximately 6,250 domestic and foreign OTIs are regulated by the Commission. In FY 2016, the 

FMC processed approximately 950 licensing transactions. At the end of FY 2016, 980 ocean freight 

forwarders (OFFs), 1,729 U.S.-based NVOCCs, 2,049 joint NVOCCs/OFFs, and 80 foreign-based 

NVOCCs held active OTI licenses. Additionally, 1,419 foreign-based NVOCCs are registered and 

maintain proof of financial responsibility with the Commission. 

The FMC also oversees a program to ensure financial responsibility for passenger vessels that have berth 

or stateroom accommodations for 50 or more passengers, and embark passengers at U.S. ports and 

territories. The requirement for Certificates of Performance, which provide financial responsibility for 

the indemnification of passengers for non-performance of transportation, prevents unscrupulous or 

financially weak operators from serving U.S. ports. The Passenger Vessel Operator (PVO) program 

encompasses 225 vessels and 47 passenger vessel operators with aggregate evidence of financial 

responsibility coverage of $594 million for non-performance and $705 million for casualty. During FY 

2016, the Commission received 16 Passenger Vessel Applications (Performance) and completed the 

processing of 13 applications. An additional 18 Passenger Vessel Applications (Casualty) were received, 

and 15 processed during the fiscal year. Through its website and the CADRS office, the FMC offers 

information and guidance to the cruising public on passenger rights and obligations regarding monies 

paid to cruise lines that fail to perform voyages. For example, BCL and CADRS assisted passengers 

impacted by the Haimark Line bankruptcy. 

In FY 2017 and FY 2018, the Commission will pursue further opportunities to streamline its business 

processes and consider additional regulatory reforms, as appropriate, including: (1) reviewing the impact 

of recent rule changes affecting the passenger vessel program and explore alternatives to enhance PVO 

monitoring procedures; (2) reviewing procedures regarding OTI licensing applications; and (3) 

continuing efforts to develop, enhance, and implement an improved electronic application process for 

both OTIs and PVOs.
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Objective 3: Enhance public awareness of agency resources, remedies, and regulatory requirements through 

education and outreach

The Commission provides information in many forms to educate regulated entities, stakeholders and 

the public about its resources, remedies and regulatory requirements. Brochures, how-to guides, forms 

and applications, reference libraries, news releases, information on investigations, and advice on topics 

such as FMC regulations, OTI licensing, household goods moves, and using ADR services to assist 

parties with resolving cruise- and cargo-related disputes are among the available offerings on the 

Commission’s website. In addition, throughout the year, Commission staff participate in presentations 

and instructional opportunities to educate consumers and regulated entities regarding regulations, 

shipping trends, best practices, and the effective use of available FMC resources to resolve formal 

proceedings, service contract matters, and other commercial shipping disputes. 

The FMC will continue its efforts to increase public access to Commission resources in FY 2018 by 

improving the design, usability, and platform of the website docket library and historical document 

repository. In addition, the Commission continues to enhance its technological capabilities to stream 

the agency’s public meetings. Further, the Commission will develop a plan for increased availability of 

public documents, including minutes of Commission actions under the Sunshine Act, on the FMC’s 

website.

Objective 4: Impartially resolve international shipping disputes through alternative dispute resolution and 

adjudication

The FMC offers informal dispute resolution, and adjudicates claims of unlawful practices by carriers, 

MTOs, and OTIs. The Commission’s Area Representatives and its Office of Consumer Affairs and 

Dispute Resolution Services (CADRS) educate industry members and the public on the Shipping Act 

and shipping regulations, and help to address international ocean transportation disputes. 

The FMC, through CADRS, offers both facilitation and arbitration services to the industry and shipping 

public to resolve disputes. An online mediation tutorial and tool was created for parties to use to prepare 

for mediation. The Commission supports mediation and collaborative dispute resolution when feasible, 

and requires parties involved in formal Commission docketed proceedings to attend mandatory 

mediation conferences. 

The Administrative Law Judges (ALJs), whose independence is protected by the Administrative 

Procedure Act, 5 U.S.C. Subchapter II, resolve cases involving alleged violations of the Shipping Act 

and other laws within the Commission’s jurisdiction. Cases may be initiated either by private parties or 

by the Commission (represented by the Bureau of Enforcement to seek civil penalties for law violations). 

The Chief ALJ also has the authority to assign small claims complaints, valued at up to $50,000, to a 

Small Claims Officer for resolution. 

Commission Action Items – Supporting the President’s Management Agenda and 

Government-wide Priorities

The Commission serves the public transparently. The FMC is committed to making smart investments 

and using management strategies to deliver effective and efficient government that rapidly reacts to the 

changing needs of its citizens and supports economic growth. 
FY 2018 Budget Request FINAL

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Customer Service

A number of the Commission’s offices and programs provide direct services to the public. CADRS 

receives many time-sensitive requests for assistance from shippers, carriers, and the cruising public. The 

Commission’s Area Representatives are located near key maritime ports (Southern California, Seattle, 

New York, Houston, New Orleans, and South Florida) and operate as the front line for questions and 

issues facing the industry. The Office of the Secretary updates the FMC’s website and social media 

frequently, providing timely and important information to the public. The FMC responds to requests 

for information from the media and the public, delivering information directly to those potentially 

affected via on-camera interviews and its website. Other offices interact with the industry and the public 

by providing information and assistance with tariffs, licensing, and competition-related issues. The FMC 

works diligently to provide the public with exceptional customer service. 

Efficient Government - Reducing Regulatory Burden and Improving Necessary Information Collection 

The FMC continuously reviews its processes and regulatory requirements for efficiency and 

effectiveness. As economic conditions alter the state of our trades, regulations are revised to respond to 

new conditions. As part of the Commission’s ongoing Plan for Retrospective Review of Existing Rules, the 

FMC will continue to review and update regulations related to a number of its programs. In FY 2016, 

the Commission issued an Advance Notice of Proposed Rulemaking, and after reviewing filed 

comments, issued a Notice of Proposed Rulemaking (NPRM) containing recommendations concerning 

potential regulatory reforms to the filing and processing of agreements, quarterly monitoring reports and 

agreement meeting minutes. The Commission also issued an Advance Notice of Proposed Rulemaking, 

and a later NPRM, on the regulations governing service contracts and NVOCC service arrangements. 

The Commission subsequently issued NPRMs for public comment in each of these rulemakings in 

August 2016. 

Further toward the goal of eliminating or reforming regulations, the Commission designated its 

Managing Director as Regulatory Reform Officer. The Regulatory Reform Officer is now leading an

internal team that is identifying those regulations that have become less relevant in today’s fast moving 

commerce, or are unduly burdensome. This team will then establish a definitive timeline within the 

agency to move those items to a vote before the Commission.

To help the Commission properly allocate its resources to most effectively drive its mission, it relies on 

evidence-supported policy and program decision-making in implementing its current FY 2014-2018 

Strategic Plan. The FMC’s commitment to smart government with measurable goals can be seen in 

Appendices E, Performance Measures by Strategic Goal; F, Workload Summary; and G, Evidence Submission. 

Open Data / Applying Innovative Technologies

The FMC remains committed to a multiyear enhancement of its IT systems, which will make it faster, 

easier and more efficient for individuals and businesses to complete transactions and have positive 

experiences with the government. Much of this enhancement involves a transition to the use of 

Enterprise Content Management technology. 

Planned FMC actions that open up government data for FY 2017 and FY 2018 include efforts to replace 

the aging Regulated Persons Index (RPI) with a modernized enterprise system, a critical database that 

will contain up-to-date records of licensed OTIs (OFFs and NVOCCs), vessel ocean common carriers, 

MTOs and other entities. This information is accessed by FMC staff, the shipping public, and security 
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and trade-related governmental agencies on a daily basis. The modernization of this system, along with 

continued investments in public information and education, will provide efficient public access to useful 

information to make critical decisions on the movement of goods by sea.

The Commission is also planning improvements for access to its public documents and providing 

relevant trade-related information by launching a newly designed website that will implement new 

technologies to make Commission information more easily accessible (including via mobile devices). 

The technologies will also facilitate updating the public on current issues in the trade via consumer alerts 

and public service announcements published on the FMC website and other social media; provide 

continuous updates to key public information, including docketing activity and documents for cases filed 

before the Commission; provide public access to filed agreements through the FMC’s agreements library, 

accessible through the website; and provide the public with key FMC studies and economic analysis of 

shipping industry trends, when applicable.

Plans that will advance the Commission’s Information Resources Management Strategic Plan in FY 2017 

and FY 2018 include:

• developing and deploying advanced ECM technology which will consolidate the OTI license 

application and registration renewal processes, enhance the ability of applicants to file 

electronically, and significantly increase efficiency in processing applications. These

improvements will support the ability of American entrepreneurs to enter the industry and 

offer needed services to the public. The system will also provide benefits to the public 

seeking information about regulated entities;

• building and deploying a new Service Contract Filing System for ease of filing and optimizing

the internal architecture of SERVCON, particularly the search functionality needed to keep 

pace with the rapid accumulation of records. This improvement will facilitate U.S. trade and 

allow shippers and carriers to more rapidly respond to real-time business needs;

• automating the filing of applications for certificates by PVOs for more efficient processing, 

and to permit applicants to use available technology to easily interact with the Commission 

to complete their Congressionally-mandated requirements; and

• migrating the current agency website to Microsoft Azure tenant, a more efficient and cost 

effective hosting platform.

People and Culture – Empowering Employees

The diligent work of its small and dedicated staff is critical to the FMC achieving its mission. The FY 

2018 budget request allocates 75% to salaries and benefits for these employees. To ensure that the FMC 

attracts and continues to maintain the skillsets necessary to provide exceptional service to the public, the 

FMC has made commitments to improve employee satisfaction in the workplace, provide relevant 

training for job skills and employee professional growth, and to improve workplace flexibilities. 

Workplace Satisfaction 

The Commission recognizes that when employees are satisfied with their employer and the work that 

they do, performance is enhanced. The FMC has participated for a number of years in the Federal 

Employee Viewpoint Survey (FEVS) to gather information on employee satisfaction. The Commission 

also seeks input on workplace satisfaction through regular all hands meetings, top-level meetings with 

staff, and agency-wide employee teams. Based on FEVS results, the FMC received an award for being 
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the 2015 Most Improved Small Agency, recognized in the Best Place to Work in the Federal Government 

rankings. 

The FMC made improving employee morale and workplace satisfaction a priority objective, and has 

made positive strides in improving workplace satisfaction in terms of leadership, transparency, matching 

skills to its mission, and work/life balance. A Workplace Improvement Plan (WIP) was put in place in 

2013, and employee teams were created to address such topics as diversity training, employee 

suggestions, telework, fitness, and other workplace initiatives. The Commission’s senior leadership 

encourages staff involvement and provides opportunities for participation in these agency-sponsored 

teams. The WIP process continues to be a driving force in workplace and employee engagement.

During 2016, the Commission continued to build on its accomplishments and recognition as the 2015 

Most Improved Small Agency, posting a 2.5 point gain over its own 2015 Partnership results. Results from 

the 2016 FEVS indicates that the Commission continues to make impressive progress in bringing about 

positive change.

Training

The FMC offers job and professional training opportunities to all employees. Online training, provided 

through a commercial vendor to Commission employees, is a cost-effective way to ensure that 

appropriate training is available year-round. The online offerings include classes in IT technical skills, 

project management, communication, leadership, management, and writing. 

The Commission’s Office of Human Resources provides annual performance management training, and 

announces opportunities for employees to participate in training classes offered by the Small Agency 

Council. The Office also facilitated commission-wide training on best communication practices and 

leadership through a class entitled Crucial Conversations in order to promote greater engagement and 

communication in the FMC workplace. The Office of Equal Employment Opportunity provides annual 

diversity and “No FEAR Act” training. The Office of Information Technology provides staff training 

on new technologies and cybersecurity. Annual ethics training is provided by the Designated Agency 

Ethics Officer, an adjunct of the Office of General Counsel.

Work Flexibilities: Alternate/Flexible Schedules and Telework

The FMC offers employees a number of alternative, flexible work schedules and telework opportunities, 

which serve to increase employee productivity and to improve work/life balance. More than 71% of 

the staff participate in alternate/flexible work schedules and telework regularly. 

A new, modernized telework policy and employee telework agreement became effective during FY 2016. 

The plan removes restrictions on the number of days an employee may request telework and lifted 

restrictions on a manager’s ability to telework on a regular basis. It also empowers managers to decide 

whether and how much telework to allow. Consistent with OPM guidance, the Commission requires 

Telework-Ready employees to telework when OPM announces that Federal offices will be closed. 

Managing Real Property Needs – “Freezing the Footprint”

The FMC works in partnership with the General Services Administration (GSA) to act as a good steward 

of government resources. In looking to better align the size of Federal real property assets with actual 

program needs, the FMC reconfigured its headquarters space during FY 2016, and returned 

approximately 460 square feet of space, providing an annual cost savings of approximately $18,000. The 

FMC will continue to evaluate its space needs going forward.
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Enhancing Shared Services 

In order to achieve efficiencies and cost-savings, the FMC uses shared services to accomplish some of 

its fiscal and personnel-related administrative functions. Each service is regularly reviewed to ensure that 

the best value is provided to the public. The Commission currently uses the following shared service 

providers:

National Finance Center 

The National Finance Center (NFC) currently provides the Commission with several human resources 

services, including payroll and time and attendance (T&A) transaction processing, managing employee 

debt, and employee separation payments. The FMC is working in coordination with NFC to transition 

to a new, automated time and attendance system, PayCheck8, in FY 2016-2017. 

Office of Personnel Management (OPM) 

In FY 2016, the FMC transitioned to OPM’s electronic Official Personnel File (eOPF) services. The 

eOPF is an electronic version of the paper OPF, and is a system for accessing the electronic folder 

online. The eOPF system allows each employee to have an electronic personnel folder instead of a paper 

folder. Benefits of eOPF include: immediate access to personnel forms and information for a 

geographically dispersed workforce; e-mail notifications to employees when documents are added to 

their eOPF; a multi-level secure environment with security rules for sensitive information; no loss of 

official personnel documents due to filing and routing errors; reduced costs associated with storage, 

maintenance, and retrieval of records; electronic transfer of HR data; integration with the agency’s 

human resources information systems (HRIS); and compliance with OPM and Federally-mandated HR 

employee record management regulations. In FY 2017, the FMC will transition from the current paperbased time and attendance system to the automated PayCheck8 system. PayCheck8 is a web-based Time 

and Attendance (T&A) Report system allowing users the flexibility to enter their time and attendance 

from anywhere they have internet connection. The T&As created in PayCheck8 will be sent directly to 

the National Finance Center (NFC) for payroll processing.

Beginning in FY 2016, the Commission’s Office of Human Resources began providing the agency with 

full service, including the recruitment, assessment, referral, and onboarding of candidates. The FMC 

retains a Memorandum of Understanding (MOU) with OPM for staffing services if demand exceeds 

internal staffing capabilities. 

Bureau of Fiscal Services (BFS)

The FMC carefully manages its costs. In order to meet its Federal financial reporting requirements, it 

leverages the Bureau of Fiscal Services for several of its administrative services. It is cost prohibitive for 

the FMC to purchase and maintain an integrated Federal financial reporting system. Since 2001, the 

FMC has been utilizing the BFS (formerly the Bureau of Public Debt) for a wide range of services. 

To operate under a fully integrated Federal financial reporting system, the FMC utilizes the Oracle 

platform services provided by the Administrative Resource Center (ARC) of BFS. ARC’s superior 

business model, impeccable performance record and progressive technological accomplishments have 

earned it the distinction of “Center of Excellence” in financial management by the Office of 

Management and Budget. Through this cross-service provider, the FMC obtains a full range of financial 

management and accounting services, including a financial management system platform, vendor and 

employee record maintenance and reporting services, budget processing, budget reporting (MAX), 

payroll accounting services, accounts payable and accounts receivable services, and procurement system 
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platform services, including purchase and fleet card services. Additionally, the FMC contracts for ARC 

Travel services, including E-Gov Travel Service, Travel Card Administration, Travel Payments and 

Relocation Services. Financial Reporting services provided by ARC will be expanded in 2017 to include 

required DATA Act reporting services.
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FY 2016 Accomplishments

Strategic Goal 1:

Maintain a competitive international ocean transportation supply system 

Objective: Enhance efficiency in the trades through the use of asset sharing authority under the Shipping Act of 

1984

Competition and Foreign Practices

The Commission evaluates the competitive impacts of carrier and marine terminal agreements and 

ensures that filed agreements comply with U.S. shipping statutes and regulations. To do so, the 

Commission reviews agreement activities, prepares economic analyses, researches and produces studies 

and profiles on agreements, carrier organizations and market conditions in a variety of U.S. liner trades. 

The FMC also identifies and researches issues of an economic or commercial nature that may affect or 

distort competition in U.S. liner markets, and reviews developments in international trade and the global 

economy. 

As the basis for its analytic work, the Commission receives and reviews minutes of agreement meetings 

and regular informational reports filed by parties to potentially anti-competitive agreements such as those 

that discuss freight rates, service contract guidelines, cargo or revenue pooling, and/or the rationalization 

of vessel capacity. During FY 2016, the FMC received 767 sets of minutes, 635 monitoring reports and 

related reports, 120 voluntary service contract guidelines, and no applications for waivers to the 

agreements, minutes, or monitoring report filing requirements. After a sequence of ocean carrier 

mergers/acquisitions, the ocean shipping industry witnessed a major restructuring of ocean alliances in 

FY 2016 which raised potentially significant competitive concerns to be addressed by the Commission.

The Commission monitors foreign shipping laws and practices that may have an adverse effect on the 

industry, and makes recommendations to the Commission for investigating and addressing such 

practices. The FMC addresses restrictive foreign shipping practices under section 19 of the 1920 Act 

and the FSPA. Section 19 empowers the Commission to make rules and regulations governing shipping 

in the foreign trade to adjust or meet conditions unfavorable to shipping. The FSPA directs the 

Commission to address adverse conditions that affect U.S. carriers in foreign trade and that do not exist 

for foreign carriers in the United States.
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In FY 2016, the FMC continued to monitor potentially restrictive foreign practices, including reviewing 

new legislation and new interpretations of existing legislation. The FMC continued to monitor and 

participate, both formally and informally, in international agreement negotiations that could affect 

foreign-borne cargo shipments to the United States. In addition, the FMC tracked consumer inquiries 

regarding possible foreign restrictive shipping practices.

The FMC continued its international outreach efforts by attending and coordinating events with foreign 

embassies and counterparts. In FY 2016, the Commission, in conjunction with other Federal agencies, 

participated in bilateral and multilateral international negotiations and discussions on shipping matters. 

In May 2016, the FMC participated in maritime bilateral discussions with officials from the People’s 

Republic of China in Los Angeles, California. In June 2016, the FMC participated in bilateral discussions 

with the Republic of Korea in Sejong City, South Korea. In August 2016, the Commission participated 

in the U.S. Japan Maritime Bilateral Discussions in Washington, D.C. In September 2016, the 

Commission participated in a high level multilateral dialogue with members of the Consultative Shipping 

Group in Washington, D.C. as well as separate maritime bilateral discussions with Panamanian 

government officials. In September 2016, the Commission participated in a high level multilateral 

dialogue with members of the Consultative Shipping Group in Washington, D.C.

The Commission also classifies controlled carriers subject to section 9 of the Shipping Act. Common 

carriers owned or controlled by foreign governments are required to adhere to certain requirements 

under the Shipping Act, and their rates are subject to Commission review. The Commission monitored 

the activities of controlled carriers in FY 2016.

Trade Oversight and Industry Research 

The Commission administered its oversight responsibilities during FY 2016, conducting research and 

analysis into a number of filed agreements and industry issues. Activities included: 

• preparing a comprehensive regulatory review of 46 C.F.R. Part 535 (Ocean Common Carrier and 

Marine Terminal Agreements) and related regulations in 46 C.F.R. § 501.27 in accordance with the 

Commission’s Plan for the Retrospective Review of Existing Rules, and seeking public comment to 

possible rule changes; 

• conducting an in-depth review of the West Coast Marine Terminal Operators Agreement’s 

(WCMTOA) PierPASS program, and issuing a formal request for additional information concerning 

the program’s service levels, conducting a detailed analysis of the program’s cost and service levels 

in the context of the Act’s section 6(g) general standard, and monitoring PierPASS’s conformity with 

the U.S. shipping statutes;

• reviewing WCMTOA’s implementation of a new chassis services fee to assess whether the fee, as 

initially proposed, either raises potentially anti-competitive concerns under the Act’s 6(g) standard 

or, alternatively, whether the fee potentially violates section 10 of the Shipping Act; 

• revising WCMTOA’s monitoring requirements to facilitate ongoing agreement monitoring;

• addressing a filed amendment with officials of the Port of Oakland aimed at establishing the 

OAKPASS (extended gates) program and the port’s plan to provide partial funding for extended 

gates;

• analyzing responses to a formal request for additional information directed at the ocean carrier 

members of the Pacific Ports Operational Improvement Agreement, FMC No. 201227, and determining how 

activities being conducted pursuant to the agreement should be monitored;

• conducting biannual meetings with representatives of the Transpacific Stabilization Agreement to review 

developments in the U.S./Asia trade; 
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• analyzing the overall cost impact and effect on small businesses of the Commission’s proposed rule 

to adjust its user fees based on FY 2015 costs in accordance with the Regulatory Flexibility Act;

• monitoring the operational and competitive impacts associated with the Hanjin Shipping bankruptcy, 

with an emphasis on responding to requests for assistance and identifying conduct which may violate 

the Act;

• conducting economic analyses on new alliance agreements resulting from carrier consolidations and 

acquisitions; and 

• providing data and economic information on liner trade conditions and agreement matters. 

The Commission continued its comprehensive status review of marine terminal operators and removed 

from the Commission’s website those that are no longer active in providing MTO services. In addition, 

for those MTOs that elect to make their MTO schedules publicly available, the FMC verified the internet 

location where those schedules are published and updated the FMC website accordingly to provide more 

current information to the public. The Commission annually reviews the status of VOCCs to verify the 

carrier operates one or more vessels owned, operated or time-chartered in the waterborne foreign 

commerce of the United States.

Service Contracts and Tariffs

During FY 2016, 88 VOCCs filed 52,968 service contracts and 734,106 contract amendments into the 

SERVCON system. The FMC processed 984 original NSAs and 1,814 amendments filed by 96 

NVOCCs. The Commission received, processed, and reviewed 1,431 Form FMC-1 filings, and provides 

the locations of those tariffs to the public. The FMC posted 5,560 active/current tariff locations to the 

Commission’s website.

The FMC conducted service contract and tariff research in support of the Commission’s agreement 

monitoring program and ad hoc research to meet the agency’s review of industry trends and practices. 

Additionally, the Commission conducted research on various surcharges, such as congestion surcharges, 

low sulfur fuel surcharges, as well as General Rate Increases published by the ocean carriers. The FMC 

also reviewed tariffs for rules on overweight containers as well as possible rules on the verifiable gross 

mass (VGM) prior to carriers implementation on July 1, 2016.

In FY 2016, the FMC conducted compliance audits of NVOCC tariffs. The Commission monitored 

NVOCC tariff rules in connection with the Commission’s regulations governing NVOCC Negotiated 

Rate Arrangements (NRAs) allowing NVOCCs to “opt out” of publicly posting rate tariffs on the 

internet so long as they use NRAs exclusively, maintain their rules tariffs free of charge, and comply with 

other requirements. At the end of FY 2016, an estimated 1,400 NVOCCs filed prominent notices or a 

rule in their respective tariff allowing them to utilize NRAs, if they opted to use the exemption instead 

of publishing a tariff rate item. The FMC continues to educate NVOCCs regarding NRA compliance 

and will continue to inform the shipping public, including through web-based training, to facilitate full 

compliance with NRA requirements.

The FMC anticipates that filings through 2017 and 2018 will remain steady. NVOCCs and VOCCs will 

be required to publish, and the FMC will need to verify, rules tariffs in carriers’ tariffs or conferences. 

As OTIs continue to enter and exit the market, the Commission will ensure that an accurate listing of 

tariff publication locations on the Commission’s website is maintained and ensure that published tariffs 

meet the Commission’s tariff publication requirements. The Commission continued to reach out to 

various service contract filers to encourage the use of web services when filing service contracts to 

increase efficiency, reduce costs and eliminate frequent filing errors.
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Strategic Goal 2: 

Protect the public from unlawful, unfair, and deceptive practices

The Commission significantly advanced its mission in FY 2016 by focusing on the integrity and security 

of international supply chains and protecting the shipping public from financial harm. 

Objective 1: Identify and take action to end unlawful, unfair and deceptive practices. 

Several major investigations undertaken or completed during FY 2016 addressed the ongoing practices 

of unlicensed and unbonded operators, of certain OTIs operating in the China-U.S. inbound trades, and 

VOCCs seeking to operate pursuant to agreements that were not filed with the Commission. 

For example, in Docket No. 15-03, the Commission issued an Order of Investigation and Hearing to 

determine whether respondent John Barbour (doing business as Barbour Expressway Shipping Inc.), 

was violating sections 19(a) and (b) of the Shipping Act by operating as an NVOCC without obtaining 

a license from the Commission and without providing proof of financial responsibility in the form of a 

surety bond. In a collateral action, the Commission’s Office of General Counsel filed for an injunction 

in Federal District Court in Massachusetts to enjoin Barbour’s continuing unlawful activities, which relief 

was granted on July 27, 2015. On January 20, 2016, the Administrative Law Judge issued an Initial 

Decision finding violations by Respondent, assessing penalties of $666,074 and issuing certain other 

relief against future activities or violations by Mr. Barbour. The decision became administratively final 

on February 23, 2016. Prior to the Commission’s investigation, Barbour had operated for years without 

a license, bond or tariff, thereby subjecting the owners of more than a thousand vehicles being shipped 

to points in the Middle East to the consequences associated with dealing with unlicensed OTIs.

In Docket No. 15-10, the Commission instituted a proceeding ordering Washington Movers Inc. to 

show cause why its OTI license should not be revoked based on the felony conviction and incarceration 

of its owner, Sam Ghanem, for attempting to illegally smuggle weapons to Lebanon. BOE filed evidence 

and arguments opposing Respondent’s contention that it should be permitted to retain its OTI license. 

On February 16, 2016, the Commission assigned the case to be heard by an Administrative Law Judge 

in order to address certain issues disputed by Respondent. The ALJ issued Preliminary Findings of Fact 

on March 25, 2016, and has established a procedural schedule to govern subsequent proceedings in the 

matter. 

During FY 2016, the Bureau of Enforcement completed notable compromise agreements with several 

of the major NVOCCs serving the inbound Far East-US trades, addressing a variety of service 

contracting malpractices. The Commission also continued ongoing investigations relating to unfiled 

carrier agreements in the U.S.-foreign trades, both inbound and outbound. The Commission collected 

penalties against several carriers for operating under unfiled space charter agreements affecting their 

RO/RO operations. Further settlements with vessel-operating carriers are expected.

The Commission’s compliance audit program continued as a major focus in FY 2016. This program, 

conducted from headquarters primarily by mail, e-mail and telephone, reviews the operations of licensed 

OTIs to assist them in complying with the statutory requirements and the Commission’s rules and 

regulations. The audit program also reviews entities holding themselves out as VOCCs, where there is 

no indication of actual vessel operations. During the year, 223 audits were commenced, 208 audits were 

completed, and 15 remained pending on September 30, 2016.
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During the fiscal year, 22 investigative matters were referred for enforcement action or informal 

compromise; 24 were compromised and settled, administratively closed, or referred for formal 

proceedings; and 12 enforcement cases were pending resolution at fiscal year’s end. Also, 2 formal 

proceedings were initiated; 1 formal proceeding was completed, and 2 were pending at the end of the 

fiscal year. The Bureau has 15 additional pending matters which it is monitoring or for which it is 

providing legal advice to other agency offices.

Objective 2: Prevent public harm through licensing and financial responsibility requirements. 

As of the end of FY 2016, the Commission had received and processed 656 OTI license applications

(new and amended), which is an increase over FY 2015. During FY 2016, 949 licensing transactions 

were processed – 422 new or amended OTI licenses were issued, and 293 licenses were revoked. 

Currently, 980 ocean freight forwarders (OFFs), 1,729 U.S. NVOCCs, 2,049 joint NVOCC/OFFs, and 

80 foreign NVOCCs hold active OTI licenses. In addition, there are 1,419 registered foreign-based 

NVOCCs who must meet the Commission’s bonding requirements. As of the end of FY 2016, 44 special 

bond riders have been received, providing optional proof of financial responsibility for NVOCCs serving 

the U.S.-China trade, and 32 riders have been terminated. The licensing process for OTIs has continued 

to be streamlined, and the time needed to process applications and reach a licensing decision was reduced 

with the goal of completing 75 percent of all OTI license applications within 60 days. During FY 2016, 

that goal was exceeded – 80 percent of all OTI license applications were completed within 60 days.

The Commission monitored 225 vessels and 47 passenger vessel operators in its passenger vessel 

program, with a total of $594 million for non-performance financial responsibility and $705 million for 

casualty financial responsibility. During FY 2016, the Commission received 16 Passenger Vessel 

Applications (Performance) and completed the processing of 13 applications. An additional 18 

Passenger Vessel Applications (Casualty) were received, and 15 processed during the fiscal year. The 

Commission conducted one on-site audit of a PVO. In 2016, one PVO (Haimark) filed for bankruptcy, 

requiring the coordination of passenger refunds by the Commission, the escrow agent, and the respective 

cruise company.

Objective 3: Enhance public awareness of agency resources, remedies, and regulatory requirements through 

education and outreach

The Commission continued extensive efforts to educate both stakeholders and the public. In response 

to the many requests for assistance, several brochures were released online. The brochures cover such 

topics as the FMC’s functions and regulatory oversight responsibilities, a description of CADRS free 

dispute resolution services, a consumer’s guide for a successful overseas move, and a passengers guide 

for planning for a cruise vacation. Throughout the fiscal year, the Commission conducted presentations, 

meetings, and educational sessions with various shipper and industry trade associations as well as media 

interviews to educate the public and regulated entities regarding the availability of the Commission’s 

CADRS ADR services to assist parties with resolving cruise and cargo-related disputes. The Commission 

initiated an informational Twitter campaign to provide the public with tips on moving overseas and 

finding a licensed and bonded mover.

In FY 2016, the Commission improved its online presence, launching a new website after a complete 

content migration to an open source platform. Commission information is now more easily accessible 

via mobile devices. The FMC also has made the agency’s public meetings under the Sunshine Act 

available to be viewed in a live webcast on the FMC website. The Commission continues to monitor 
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public usage trends and leverage user feedback to implement ongoing improvements to www.fmc.gov. 

Improvements for FY 2016 include: improved visibility of important information as well as archiving 

and streamlining content to improve delivery and accuracy of information.

Objective 4: Impartially resolve international shipping disputes through alternative dispute resolution and 

adjudication

The FMC’s office of Consumer Affairs and Dispute Resolution closed 641 ombuds matters during FY 

2016. Of those, 331 involved commercial cargo-related disputes, 180 involved household goods 

shipment disputes, 126 involved cruise line concerns, and 4 others involved miscellaneous Shipping Act 

related matters. The Commission initiated 10 mediation matters during the fiscal year. The Commission 

responded to 5 Congressional requests for assistance on behalf of constituents requesting assistance with 

difficulties encountered involving cruise vacations. 

The FMC collaborated with the Federal Motor Carrier Safety Administration (FMCSA) in FY 2016 

under the auspices of the FMC – FMCSA MOU through participation in quarterly working group 

meetings and Moving Fraud task force meetings. The Commission also coordinated with FMCSA on a 

matter involving an FMC-licensed entity that refused to respond to inquiries involving the whereabouts 

of a container containing a critically ill child’s medication. FMC staff coordinated with FMCSA to 

successfully locate the shipment in a New Jersey warehouse. With FMC assistance, the warehouse and 

the consumer were able to arrange for delivery of the medication to its destination.

In addition to its efforts with the FMCSA, the Commission continued to assist shippers with demurrage 

disputes. The FMC received congestion-related complaints totaling approximately $505,810. The 

Commission also coordinated with state Attorney General Offices on international shipping problems. 

For example, the Attorney General for Illinois referred 22 matters to the FMC involving an unlicensed 

OTI that was arranging shipments to Poland. The unlicensed entity allegedly collected cargo and freight 

but failed to remit payment to other parties in the logistics chain. 

The Office of Administrative Law Judges began FY 2016 with 9 pending formal proceedings and 1 

pending informal proceeding. Thirteen new formal proceedings and 1 new informal proceeding were 

assigned during the year, and the Commission remanded 1 formal proceeding for hearing. OALJ issued 

10 initial decisions or orders in formal proceedings subject to review by the Commission, and the 

Commission dismissed 1 formal proceeding based on stipulation of the parties. OALJ issued a dismissal 

in 1 informal proceeding that the Commission did not review. At the end of FY 2016, 13 formal 

proceedings and 1 informal proceeding were pending before OALJ.
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Additional 2016 Accomplishments 

Information Technology

The Commission has focused on completing major upgrades to its internal IT systems, in part through 

creation of an Enterprise Content Management (ECM) solution to improve data support for all 

Commission programs and research projects, as well as to simplify stakeholder interaction and filing 

processes and ensuring that the FMC’s systems meet cybersecurity best practices. During FY 2016, the 

FMC made significant progress towards the planned identified goals and objectives, including:

• moving the Commission’s disaster recovery server to a cloud based solution, assisting the FMC 

in effectively continuing operations in an emergency event and saving the Commission the 

operating costs of maintaining a physical disaster recovery location;

• made significant upgrades to the agency’s IT infrastructure;

• migrating our ISP contract to a FEDRAMP-compliant ISP provider;

• enhancing the FMC’s security posture by deploying various security tools, such as Xacta, Nessus, 

ManageEngine, and Varonis, in addition to the security services provided by Microsoft, the CDM 

program;

• offering the availability of all internal line of business applications in the cloud via Office 365;

• streamlining communication between FMC field offices and headquarters, no longer requiring 

field offices to connect via a VPN; and

• implementing an MOU with U.S. Customs and Border Protection to allow data from CBP’s 

Automated Commercial Environment to be accessed directly by the FMC for use in fulfilling its 

statutory and regulatory duties and responsibilities, including accessing trade data that facilitates 

the Commission’s oversight of carrier agreement filings. This direct transfer of data will conserve 

resources of both agencies and ensure greater trade compliance with the Security and 

Accountability for Every Port Act of 2006 (SAFE Port Act, Pub.L. 109-347).

Representative Rulemakings, Adjudications, and Litigation 

During FY 2016, the Commission sought public comment in considering revisions to its regulations via 

several advanced notices of proposed rulemaking, and then published several final rulemakings. 
FY 2018 Budget Request FINAL

[29]

Rulemakings

• Organization and Functions; Rules of Practice and Procedure; Attorney Fees [Docket 

No. 15-06]

On March 1, 2016, the Commission issued a Final Rule amending its Rules of Practice and 

Procedure governing the award of attorney fees in Shipping Act complaint proceedings and 

revised its regulations related to Commissioner terms and vacancies. The regulatory changes 

implemented statutory amendments made by the Howard Coble Coast Guard and Maritime 

Transportation Act of 2014. The preamble to the rule also provides guidance on the 

Commission’s application of the new statutory provision governing attorney fees.

• Ocean Common Carrier and Marine Terminal Operator Agreements Subject to the 

Shipping Act of 1984 [Docket No. 16-04]

On August 12, 2016, the Commission issued a Notice of Proposed Rulemaking requesting 

comment on a number of substantive and technical amendments to the regulations governing 

the filing requirements for agreements. The Commission last made major changes to these 

regulations in 2004, and is now considering updating these requirements in order to reflect 

changes to the shipping industry and to reduce unnecessary burdens on regulated entities.

• Service Contracts and NVOCC Arrangements [Docket No. 16-05]

On August 18, 2016, the Commission issued a Notice of Proposed Rulemaking seeking public 

comment on the Commission’s service contract and Non-Vessel-Operating Common Carrier 

(NVOCC) service arrangement rules. The Commission is considering clarifying certain rules to 

leverage technology to relieve regulatory burdens. Possible amendments include the use of web 

services and greater flexibility in the filing of service contract amendments.

• Update of Existing and Addition of New User Fees [Docket 16-06]

On August 25, 2016, the Commission issued a Final Rule updating its user fees to reflect the 

current costs of services provided by the Commission, as directed by Office of Management and 

Budget Circular No. A-25. The rule contains a new methodology and increases certain fees while 

repealing or lowering other fees. The Commission sought public comment prior to issuing the 

Final Rule. 

Commission Decisions 

During FY 2016, the Commission resolved private international shipping disputes filed by complainants 

and enforced the Shipping Act and its regulations through adjudication before the Commission. In FY 

2016, the Commission, including its ALJs and legal staff, issued numerous legal opinions, 

recommendations, case summaries, decisions and final orders. Settlement is explored in each pending 

litigation matter in an effort to ensure efficient and effective dispute resolution. The following case 

represents a matter that the Commission adjudicated, which involved a substantial amount of 

Commission resources. 

• Maher Terminals, LLC v. Port Authority of New York & New Jersey [Docket 12-02]

Maher filed a complaint against the Port Authority of New York and New Jersey alleging fifteen 

Shipping Act violations regarding the Port’s marine terminal leases. The Port moved to dismiss 

the claim based on failure to state a claim, the statute of limitations, collateral estoppel, and lack 

of standing or ripeness. The ALJ granted the Port’s motion on January 30, 2015, and dismissed 
FY 2018 Budget Request FINAL

[30]

Maher’s claims without leave to amend. Maher filed exceptions to the ALJ’s decision, and on 

December 17, 2015, the Commission affirmed the decision in part and dismissed 11 of Maher’s 

claims without leave to amend. The Commission reversed the decision with respect to four 

claims and remanded them to the ALJ for further proceedings. In so doing, the Commission 

confirmed that motions to dismiss for failure to state a claim are governed by the standard used 

by the Federal courts.
FY 2018 Budget Request FINAL

[31]

Appendices

Appendix A: Resource Allocation by Program

Appendix B: FTEs and Positions Allocation by Program

Appendix C: Obligations by Object Class

Appendix D: Relationship of Obligations to Outlays 

Appendix E: Performance Measures by Strategic Goals

Appendix F: Workload Summary

Appendix G: Evidence Submission

Appendix H: OIG Certification
FY 2018 Budget Request FINAL

[32]

Appendix A: Resource Allocation by Program

Strategic Goal # 1Strategic Goal # 2

Maintain an 

efficient and 

competitive 

international 

ocean 

transportation 

system

Protect the 

public from 

unlawful, unfair 

and deceptive 

practices and 

resolve shipping 

disputes

Formal Proceedings

 Office of the Chairman $1,069,497.88 $1,067,032.31 $234,412.36 $937,649.45 $1,172,061.82 $105,029.51

 Office of the Commissioners $1,607,771.34 $1,805,749.75 $329,317.81 $1,317,271.22 $1,646,589.03 ($159,160.72)

 Office of the Secretary $1,394,648.79 $1,393,463.39 $251,548.31 $962,822.82 $1,214,371.13 ($179,092.26)

 Library $98,086.77 $91,904.51 $12,294.82 $49,179.30 $61,474.12 ($30,430.39)

 Office of Consumer Affairs and Dispute Resolution 

Services $1,263,594.67 $1,304,495.35 $0.00 $1,362,133.53 $1,362,133.53 $57,638.18

 Office of the General Counsel $1,838,580.37 $2,083,652.63 $1,113,068.53 $1,113,068.53 $2,226,137.06 $142,484.43

 Ethics $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

 Office of Administrative Law Judges $831,630.34 $917,858.07 $464,251.69 $464,251.69 $928,503.37 $10,645.30

Formal Proceedings Total $8,103,810.16 $8,664,156.01 $2,404,893.51 $6,206,376.55 $8,611,270.06 ($52,885.95)

Office of Equal Employment Opportunity $172,701.15 $201,933.78 $41,269.43 $165,077.73 $206,347.16 $4,413.38

Office of the Inspector General $360,076.15 $549,025.10 $48,093.14 $432,838.27 $480,931.41 ($68,093.69)

Operational and Administrative

 Office of the Managing Director $1,832,447.01 $2,400,750.55 $503,355.11 $1,653,881.07 $2,157,236.18 ($243,514.37)

 Bureau of Trade Analysis $3,211,764.00 $3,553,129.55 $2,181,690.80 $1,527,198.67 $3,708,889.47 $155,759.92

 Bureau of Certification and Licensing $2,368,403.11 $2,426,424.84 $0.00 $2,563,023.80 $2,563,023.80 $136,598.96

 Bureau of Enforcement $2,058,768.80 $1,831,739.66 $0.00 $1,932,854.61 $1,932,854.61 $101,114.95

 Area Representatives $1,735,663.50 $2,157,575.16 $359,019.57 $1,436,078.30 $1,795,097.87 ($362,477.29)

 Office of Information Technology $3,401,350.40 $3,280,911.87 $457,783.30 $1,831,133.18 $2,288,916.48 ($991,995.39)

 Office of Human Resources $783,471.89 $858,188.80 $189,036.37 $756,145.46 $945,181.83 $86,993.03

 Office of Budget and Finance $780,797.46 $803,669.74 $172,617.45 $690,469.81 $863,087.26 $59,417.52

 Office of Management Services $765,021.76 $762,494.94 $119,232.78 $476,931.10 $596,163.88 ($166,331.06)

Operational and Administrative Total $16,937,687.93 $18,074,885.11 $3,982,735.37 $12,867,716.00 $16,850,451.38 ($1,224,433.73)

Totals $25,574,275.39 $27,490,000.00 $6,476,991.46 $19,672,008.54 $26,149,000.00 ($1,341,000.00)

The Request by Strategic Goal and Program chart identifies the funding level requested for FY18 broken out by program office and strategic 

goal. The chart identifies FY18 changes over the FY17 estimated funding requirements.

Resource Allocation by Program

FY 2018

Program/Office

FY 2016 

Actual

FY 2017 

Enacted

FY 2018 Request

FY 2018 

Request

Difference From 

FY 2017 

Estimate 
FY 2018 Budget Request FINAL

[33]

Appendix B: FTEs and Positions Allocation by Program

Program/Office FTEs Positions* FTEs Positions FTEs Positions FTEs Positions

Headquarters 115.01 121.00 115.98 118.00 118.00 119.00 2.02 1.00

Area Representatives 7.51 11.00 8.50 9.00 9.00 9.00 0.50 0.00

Agency Total 122.52 132.00 124.48 127.00 127.00 128.00 2.52 1.00

Formal Proceedings

 Office of the Chairman 4.91 5.00 5.00 5.00 5.00 5.00 0.00 0.00

 Office of the Commissioners 6.96 8.00 6.17 7.00 7.00 7.00 0.83 0.00

 Office of the Secretary 7.42 8.00 7.15 8.00 7.00 7.00 (0.15) (1.00)

 Office of Consumer Affairs and Dispute Resolution Services 7.00 7.00 7.00 7.00 7.00 7.00 0.00 0.00

 Office of the General Counsel 9.03 10.00 9.53 10.00 10.00 10.00 0.47 0.00

 Office of Administrative Law Judges 4.00 4.00 4.00 4.00 4.00 4.00 0.00 0.00

Formal Proceedings Total 39.33 42.00 38.85 41.00 40.00 40.00 1.15 (1.00)

Office of Equal Employment Opportunity 1.00 1.00 1.00 1.00 1.00 1.00 0.00 0.00

Office of the Inspector General 1.00 1.00 1.00 1.00 1.75 2.00 0.75 1.00

Operational and Administrative

 Office of the Managing Director 8.06 8.00 9.37 9.00 9.00 9.00 (0.37) 0.00

 Bureau of Trade Analysis

 Office of the Director 3.00 3.00 2.25 2.00 2.00 2.00 (0.25) 0.00

 Office of Service Contracts and Tariffs 4.00 4.00 4.00 4.00 4.00 4.00 0.00 0.00

 Office of Economics and Competition Analysis 7.30 8.00 9.38 10.00 9.25 10.00 (0.13) 0.00

 Office of Agreements 3.00 3.00 3.00 3.00 3.00 3.00 0.00 0.00

 Bureau of Certification and Licensing

 Office of the Director 3.00 3.00 3.00 3.00 3.00 3.00 0.00 0.00

 Office of Passenger Vessels and Information Processing 5.00 5.00 5.61 5.00 5.00 5.00 (0.61) 0.00

 Office of Transportation Intermediaries 8.71 9.00 7.84 9.00 9.00 9.00 1.16 0.00

 Bureau of Enforcement 10.52 11.00 9.65 9.00 10.00 10.00 0.35 1.00

 Area Representatives 7.51 11.00 8.50 9.00 9.00 9.00 0.50 0.00

 Office of Information Technology 7.73 8.00 7.35 7.00 7.00 7.00 (0.35) 0.00

 Office of Human Resources 4.83 5.00 5.00 5.00 5.00 5.00 0.00 0.00

 Office of Budget and Finance 4.03 5.00 4.73 5.00 5.00 5.00 0.27 0.00

 Office of Management Services 4.50 5.00 3.95 4.00 4.00 4.00 0.05 0.00

Operational and Administrative Total 81.19 88.00 83.63 84.00 84.25 85.00 0.62 1.00

Total FTEs and Positions 122.52 132.00 124.48 127.00 127.00 128.00 2.52 1.00

* Denotes estimated positions on September 30 @ 9/30/2016.

Actual Enacted Request From FY 2017

FTEs and Positions by Program

FY 2016 - FY 2018

FY 2016 FY 2017 FY 2018 Difference
FY 2018 Budget Request FINAL

[34]

Appendix C: Obligations by Object Class

FY 2016 FY2017 FY2018

Category Actual Enacted Estimate

 (11.1) Full-time Permanent Employees $14,087,035.46 $15,582,000.00 $15,163,329.00 ($418,671.00)

 (11.3) Part-time and Temporary Employees $91,214.67 $91,000.00 $0.00 ($91,000.00)

 (11.7) Performance Awards $0.00 $0.00 $0.00 $0.00

 (12.1) Personnel Benefits $4,191,380.00 $4,654,000.00 $4,629,775.00 ($24,225.00)

Total Personnel Compensation & Benefits $18,369,630.13 $20,327,000.00 $19,793,104.00 ($533,896.00)

 (21.0) Travel and Transportation of Personnel $155,177.89 $200,000.00 $130,000.00 ($70,000.00)

 (22.0) Transportation of Things (Express Mail) $24,206.99 $22,000.00 $10,000.00 ($12,000.00)

 (23.1) Rental Payments to GSA $3,217,399.71 $3,517,000.00 $3,430,200.00 ($86,800.00)

 (23.5) Telephones (Local, Long Distance and Cellular) $382,359.28 $239,300.00 $211,000.00 ($28,300.00)

 (23.8) Postage $6,672.48 $5,700.00 $2,500.00 ($3,200.00)

 (24.0) Printing $63,031.00 $139,000.00 $50,000.00 ($89,000.00)

 (25.1) Consulting $934,650.91 $775,318.00 $558,994.00 ($216,324.00)

 (25.2) Purchase of Goods and Services from Commercial Accounts $599,573.66 $615,782.00 $429,352.00 ($186,430.00)

 (25.3) Purchase of Goods and Services from Government Accounts $1,311,160.88 $1,373,900.00 $1,418,850.00 $44,950.00

 (25.7) Equipment Maintenance $29,705.22 $22,000.00 $20,000.00 ($2,000.00)

 (26.0) Supplies and Materials $116,863.48 $135,000.00 $45,000.00 ($90,000.00)

 (31.0) Hardware and Software $363,843.76 $118,000.00 $50,000.00 ($68,000.00)

Travel and Administrative Expenses $7,204,645.26 $7,163,000.00 $6,355,896.00 ($807,104.00)

Total Budget Authority $25,574,275.39 $27,490,000.00 $26,149,000.00 ($1,341,000.00)

The Obligations by Object Class chart identifies the Commission's actual funding expenses of 2016 and the estimated funding requirements for the 

FMC to complete its mission in FY17 and FY18. Costs are reported by object codes.

Travel and Administrative Expenses

Obligations by Object Class

FY 2016 - FY 2018

Rent, Communications and Utilities

Personnel Compensation and Benefits

 Difference 

From FY 2017 
FY 2018 Budget Request FINAL

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Appendix D: Relationship of Obligations to Outlays
FY 2018 Budget Request FINAL

[36]

Appendix E: Performance Measures by Strategic Goals

Strategic Goals Objective Performance Measures 2013 

Actual

2014 

Actual

2015 

Actual

2016 

Actual

2017 

Target

2018 

Target

STRATEGIC GOAL 1: 

Maintain a 

competitive 

international ocean 

transportation

supply system.

OBJECTIVE 1: Enhance 

efficiency in the trades 

through the use of 

asset sharing authority 

under the Shipping Act 

of 1984.

Percentage share of U.S. 

containerized cargo moving 

on other agreement parties’ 

vessels in major U.S. trades.

19.5% 45.6% 49% 51% 41% 41.5%

STRATEGIC GOAL 2: 

Protect the public 

from unlawful, 

unfair, and deceptive 

ocean transportation 

practices.

OBJECTIVE 1: Identify 

and take action to end 

unlawful, unfair, and 

deceptive practices.

Percentage of enforcement 

actions taken under the 

1984 Act successfully 

resolved through favorable 

judgment, settlement,

issuance of default 

judgment, or compliance 

letter or notice.

78.9% 83.8% 83.4% 88.6% 77.5% 77.5%

OBJECTIVE 2: Prevent 

public harm through 

licensing and financial 

responsibility 

requirements.

Percentage of decisions on 

completed OTI license 

applications rendered within 

60 calendar days of receipt, 

facilitating lawful operation 

of OTIs with the appropriate 

character and experience.

87.6% 71.3% 72% 98% 75% 75%

Percentage of cruise line 

operators examined during 

the year that have the full 

financial coverage required 

by regulation to protect 

against loss from nonperformance or casualty.

100% 96.7% 96% 96% 95% 95%

OBJECTIVE 3: 

Enhance public awareness of agency

resources, remedies 

and regulatory 

requirements through 

education and 

outreach. 

Percentage of key 

Commission issuances, 

orders and reports available 

through the Commission’s 

website within 5 working 

days of receipt.

86% 93% 92% 90% 82% 84%

OBJECTIVE 4: 

Impartially resolve 

international shipping 

disputes through 

alternative dispute 

resolution and 

adjudication.

Number of cases opened 

and closed each Fiscal Year 

using ombuds and ADR 

services assisting consumers 

to recover goods or funds.

800 994 882 778 N/A N/A

Percentage of ombuds and 

ADR matters closed within 6 

months of request for 

assistance

N/A N/A N/A NA 60% 60.5%

Percentage of formal 

complaints or Commissioninitiated orders of 

investigation completed 

within two years of filing or 

Commission initiation.

91% 88% 90% 86% 62% 64%
FY 2018 Budget Request FINAL

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Appendix F: Workload Summary 

Workload Summary

Workload Category On Hand 

9/30/2016

FY 2016 Actual FY 2017 Actual FY 2018 Estimate

Received Output Received Output Received Output

Formal Proceedings (OALJ) 9 13 11* 10 10 10 10

Informal Proceedings (OALJ) 1 1 1**

Decisions, Reports, in Docketed Proceedings 

Before the Commission 15 22 22 25 25 25 25

Federal Register Notices 0 85 85 100 100 100 100

FOIA Requests 12 30 35 30 35 28 30

Ombuds 148 538 641 600 600 650 650

ADR Matters 8 17 10 10 12 10 12

Legislation 0 55 55 130 130 135 135

Legal Opinions, Recommendations, Case 

Summaries, Decisions and Final Orders 5 180 180 190 190 195 195

Audits and Monitoring Activities 9 223 208 225 225 230 230

OTI Applicant and License Checks (BOE) 0 645 645 655 655 655 655

Formal Proceedings (BOE) 3 2 1 2 2 3 3

Civil Penalty Cases 15 22 24 24 22 25 25

Agreements Filed 11 251 250 260 266 255 255

Agreement Reports 104 1,522 1,554 1,520 1,560 1,520 1,542

Service Contracts 0 52,968 52,968 55,500 55,500 57,000 57,000

Service Contract Amendments 0 734,106 734,106 666,000 666,000 684,000 684,000

NVOCC Service Arrangements (NSA) 0 984 984 1,000 1,000 1,150 1,150

NSA Amendments 0 1,814 1,814 1,900 1,900 2,000 2,000

FMC-1 Form 0 1,431 1,431 1,450 1,450 1,475 1,475

OTI Applications – NEW 94 373 333 375 335 385 345

OTI Business Change Applications 58 283 113 358 188 433 263

OTI License Terminations 0 293 293 322 322 322 322

Passenger Vessel Applications (Performance) 0 16 13 17 17 18 18

Passenger Vessel Applications (Casualty) 4 18 15 17 17 18 18

*OALJ issued 10 initial decisions or orders in formal proceedings subject to review by the Commission, and one formal proceeding was dismissed 

based on stipulation of the parties.

**One informal proceeding was dismissed by OALJ, which the Commission did not review. 
FY 2018 Budget Request FINAL

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Appendix G: Evidence Submission

FEDERAL MARITIME COMMISSION – FY 2018 EVIDENCE SUBMISSION

FMC Use of Evidence-based Decision-making

Strategy to Advance the Use of Evidence in Decision-Making

The FMC’s 2014-2018 Strategic Plan (Strategic Plan) and FMC 2014-2018 Information Resources 

Management Strategic Plan (IRM Plan) capture the Commission’s methodology in improving the 

Commission’s program performance and increasing its impact through the use of evidence. The 

Strategic Plan has created performance measures, shown in Appendix E, setting goals and objectives for 

its program areas in each fiscal year. 

The Commission’s senior leadership meets regularly to discuss challenges and ensure that the agency is 

collecting and reviewing data on its objectives and goals. The Commission is currently revising its 

Strategic Plan and IRM Plan based on a review of the data collected and the metrics utilized. The revised 

plans will be published in FY 2017. As part of its review, the Commission will determine whether 

alternate or additional data will best match the agency’s strategic goals and objectives. 

Recent Progress

As part of the FMC’s program evaluation, the Commission has implemented a retrospective review plan 

to systematically examine and seek public input on its key regulations. In FY 2016, the Commission, 

through working groups staffed by members of its bureaus and offices, continued its systematic review 

of its Agreements and Service Contracts regulations. The review included seeking written comments 

from interested parties, analysis of comments received, meeting with various stakeholders, and 

consideration of industry and FMC practices. The Commission moved forward with Notices of 

Proposed Rulemakings or Advanced Notices of Proposed Rulemakings for each proposed regulatory 

change. The Commission also reviewed and updated its User Fees to reflect the current costs of 

rendered services. 

The Commission is working to be a more efficient organization by making a concerted and focused 

effort to reduce regulatory burdens on its constituents. The Commission is aggressively looking for ways 

to make compliance with its statutory and regulatory requirements easier and more cost effective for 

shippers, carriers, and ocean transportation intermediaries. One example was the agency’s approval of 

key changes to regulatory requirements for ocean carrier service contract filings and NVOCC service 

arrangement filings. The Commission will make it easier and more efficient for shippers and carriers to 

do business.

In addition to its own internal metrics, the Commission is working to implement Federal DATA Act 

requirements that will assist in better government-wide collection of metrics on government spending. 

The FMC, through its shared service provider, is updating its information collection parameters for 

contracting and fiscal oversight. The FMC’s working group for DATA Act issues has been monitoring 

the progress made by the shared service provider and preparing for implementation in the upcoming 

fiscal year.

The Commission improves its internal program analysis through data collected by other agencies. 

Specifically, the FMC leverages data collection and analysis through an MOU with the U.S. Customs and 
FY 2018 Budget Request FINAL

[39]

Border Protection to utilize existing systems and services. The FMC also has an active MOU with the 

Census Bureau, U.S. Department of Commerce, providing the FMC with access to the Census’ 

Automated Export System (AES) database. The confidential export shipment data collected by the 

Census Bureau assists the FMC in its review of the trade, unlicensed entities and potential Shipping Act 

violations. 

Current Barriers

The Commission remains dedicated to meeting the challenges for smart, effective government. The 

Commission’s two primary barriers are a lack of funding and a lack of available staff resources to dedicate 

to evidence collection and analysis at a meta-level. The FMC does not have the resources to create a 

separate office or position to lead a high level coordination of evidence-based evaluation at this time. 

The FMC’s staff works on evidence-based evaluation as a collateral duty. 
FY 2018 Budget Request FINAL

[40]

Appendix H: OIG Certification 

Office of Inspector General

FEDERAL MARITIME COMMISSION

Washington, DC 20573

June 22, 2017

The Inspector General Reform Act (Pub. L. 110-149) was signed by the President on October 14,

2008. Section 6(f)(1) of the Inspector General Act of 1978, 5 U.S.C. app. 3, was amended to require

certain specifications concerning Office of Inspector General (OIG) budget submissions each fiscal

year (FY).

Each inspector general (IG) is required to transmit a budget request to the head of the establishment 

or designated Federal entity to which the IG reports specifying:

• the aggregate amount of funds requested for the operations of the OIG,

• the portion of this amount requested for OIG training, including a certification from the 

IG that the amount requested satisfies all OIG training requirements for the fiscal year, 

and

• the portion of this amount necessary to support the Council of the Inspectors General on

Integrity and Efficiency (CIGIE).

The head of each establishment or designated Federal entity, in transmitting a proposed budget to 

the President for approval, shall include:

• an aggregate request for the OIG,

• the portion of this aggregate request for OIG training,

• the portion of this aggregate request for support of the CIGIE, and

• any comments of the affected IG with respect to the proposal.

The President shall include in each budget of the U.S. Government submitted to Congress:

• a separate statement of the budget estimate submitted by each IG,

• the amount requested by the President for each OIG,

• the amount requested by the President for training of OIGs,

• the amount requested by the President for support of the CIGIE, and

• any comments of the affected IG with respect to the proposal if the IG concludes that the 

budget submitted by the President would substantially inhibit the IG from performing 

duties of the OIG.
[41]

Following the requirements as specified above, the Federal Maritime Commission Inspector

General submits the following information relating to the OIG’s requested budget for FY 2018:

• the aggregate budget request for the operations of the OIG, to include overhead, is 

$480,931

• the portion of this amount needed for OIG training is $2,500, and

• the portion of this amount needed to support the CIGIE is $1,000.

I certify as the Inspector General of the Federal Maritime Commission that the amount I

have requested for training satisfies all OIG training needs for FY 2018.

Jon Hatfield, Inspector General

Federal Maritime Commission