Federal Maritime

Commission

55th Annual

Report

for

Fiscal Year

2016

Table of Contents

Letter of Transmittal 1

Members of the Commission 3

FMC Mission, Strategic Goals, and Functions 5

Strategic Goal 1 5

Strategic Goal 2 6

Statutory Authority 6

Year in Review 7

Efficiency and Competition 9

Strategic Goal 1 9

Agreement Filings and Review 9

Types of Agreements 10

Competitive Impact and Monitoring 13

Tariffs, Service Contracts, NSAs, & MTO Schedules 16

Supply Chain Innovation Initiative 17

International Cooperation 20

Protecting the Public 23

Strategic Goal 2 23

Licensing 23

Revisions to Licensing Rules 24

Passenger Vessel Program 25

Consumer Affairs and Education 26

Enforcement, Audits and Penalties 27

Inter-Agency Cooperation 28

Leveraging Technology 30

Developments in Major U.S. Foreign Trades 33

Worldwide 33

Asia 34

Indian Subcontinent and Middle East 35

North Europe 35

Mediterranean 36

Australia and Oceania 37
Africa 37

Central America and the Caribbean 38

South America 38

Top Twenty U.S. Liner Cargo Trading Partners 41

Top Twenty U.S. Liner Cargo Trading Partners (FY2015 Imports and Exports)

42

Foreign Shipping Practices Act 43

Controlled Carriers 44

Formal Investigations, Private Complaints and Litigation 45

Formal Investigations 46

Private Complaints 46

Litigation 51

Rulemakings 53

APPENDICES 55

A - FMC Organization Chart 55

B - FMC Senior Officials - Fy 2016 56

C - Statement of Appropriations, Obligations, and Receipts 57

D - Civil Penalties Collected 58
55th Annual Report 1

Letter of Transmittal

FEDERAL MARITIME COMMISSION

800 North Capitol Street, N.W.

Washington, DC 20573-0001

March 31, 2017

To the United States Senate and House of Representatives:

On behalf of my fellow Commissioners, I welcome this opportunity to share with you the 

Federal Maritime Commission 55th Annual Report, which highlights the key accomplishments, 

initiatives, and relevant events that occurred during FY 2016.

The past year has been a period of consequential change in the international shipping sector. 

The maritime transportation services industry is signigicantly remaking itself and the potential 

impacts this may have on the American shipping public are recounted in this report. 

Additionally within our report, you will learn about actions the Commission took to increase 

seaport efficiency, particularly via our Supply Chain Innovation Teams Initiative. Further, we 

cite important developments concerning filed agreements and FMC regulations. In short, we 

have continued to focus on ways to make it easier for our constituents to interact with the 

Commission and to ensure compliance requirements are as minimally burdensome as possible. Finally, we provide details of enforcement actions taken by the agency, including an 

accounting of the $3.3 million in fines collected.

Guaranteeing a competitive marketplace for international ocean transportation services is 

the key mission of the Federal Maritime Commission. All aspects of the American economy 

rely upon supply chain systems that are global in nature and almost always revolve around 

the oceanborne intermodal container. Accordingly, Shipping Act violations by ocean carriers 

or ocean transportation intermediaries not only break the law, but put the economic wellbeing 

of the nation in danger. I am proud of the Commission’s work and this report helps to illustrate the contributions the 128 dedicated staff members at the FMC make toward upholding 

the Shipping Act.

Thank you for your attention and I welcome the opportunity to be of assistance to you in 

any matter within the jurisdiction of the Federal Maritime Commission

Sincerely,

Michael A. Khouri

Acting Chairman
2 55th Annual Report
55th Annual Report 3

Members of the Commission

William P. Doyle

Commissioner

Appointed 2013

Term Expires 2018

Mario Cordero

Commissioner

Appointed 2011

Term Expires 2019

Michael A. Khouri

Acting Chairman

Appointed 2009

Term Expires 2021

Daniel B. Maffei

Commissioner

Appointed 2016

Term Expires 2017

Rebecca F. Dye

Commissioner

Appointed 2002

Term Expires 2020
4 55th Annual Report
55th Annual Report 5

FMC Mission, Strategic 

Goals, and Functions

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 the U.S. consumer. 

The FMC's Mission is:

• To foster a fair, efficient and reliable international ocean transportation system and to 

protect the public from unfair and deceptive practices.

The FMC's Vision is:

• Fairness and Efficiency in the U.S. Maritime Commerce.

The Commission will achieve its Mission and Vision by 

ensuring that the fundamental dynamics of a free, open and 

competitive ocean transportation market drive economic 

outcomes. To that end, the Commission is committed to faithfully administer the Shipping Act while employing a minimum 

of government intervention and regulatory costs and by placing 

a greater reliance on the marketplace.

Strategic Goal 1

Maintain an efficient and competitive international ocean transportation system. 

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

public by:

• Reviewing and monitoring agreements among ocean common carriers and marine 

terminal operators (MTOs) serving the U.S. foreign oceanborne trades to ensure that 

they do not cause substantial 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;

FMC Mission

To foster a fair, efficient 

and reliable international 

ocean transportation system and to protect the 

public from unfair and 

deceptive practices.
6 55th Annual Report

• 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 

business practices in U.S. foreign shipping trades.

Strategic Goal 2

Protect the shipping public from unlawful, unfair and deceptive ocean 

transportation practices and resolve shipping disputes.

The FMC protects the public from financial harm, and contributes to the integrity and 

security of the U.S. supply chain and transportation system by:

• Investigating and ruling on complaints regarding rates, charges, classifications, and 

practices of common carriers, MTOs, and Ocean Transportation Intermediaries (OTIs), 

that violate the Shipping Act;

• Licensing OTIs with appropriate character and adequate financial responsibility; 

• Helping resolve disputes involving shipments of cargo, personal or household goods, 

or disputes between cruise vessel operators and passengers;

• Identifying and holding regulated entities accountable for mislabeling cargo shipped 

to or from the United States; and

• Ensuring that cruise lines maintain financial responsibility to pay claims for personal 

injury or death, and to reimburse passengers when their cruise fails to sail.

Statutory Authority

The principal statutes administered by the Commission, now codified in Title 46 of the U.S. 

Code at sections 40101 through 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
55th Annual Report 7

Year in Review

Last year was one of significant and historical changes to the container shipping industry, 

changes that fundamentally shifted many of 

the foundations of the business, and that will 

have an influence on the sector for years to 

come.

The first major development to the shipping industry was significant consolidation 

among container ship lines, also known as 

ocean common carriers. At the end of 2015, 

there were 20 major container ship lines in 

business. In 2017, several planned mergers 

and acquisitions will reduce the number to 13. 

In some respects, this trend was long anticipated and overdue, particularly given the 

poor financial performance of ocean common 

carriers for several consecutive years prior. 

The bankruptcy of a “top ten” carrier, Hanjin 

Shipping, in September was a manifestation 

of the perilous and unsound financial position 

container ship lines have found themselves 

in for the better part of a decade as a result of 

unsustainable rates and chronic overcapacity. 

Second, as a consequence of the contraction 

of the number of container shipping companies operating in the international trades, we 

witnessed the complete re-creation of the 

ocean carrier alliance structure. In calendar 

year 2016, the Commission allowed two new 

alliances to be established that will come 

into force later in 2017. By the middle of 2017, 

ocean carriers calling the United States will 

belong to one of three alliances: the 2-M, THE 

Alliance, or the OCEAN Alliance. 

In both calendar year and fiscal year 2016, 

the Commission devoted significant time and 

resources to reviewing the interconnected 

developments of carrier consolidation and 

alliance restructuring. In the coming year, and 

for the foreseeable future, the FMC must be 

diligent in monitoring these new alliances 

given the potential impact on American 

shippers. Be assured, however, that rate and 

service competition between the various ocean 

carriers remained intense.

Though trade growth in 2016 was not 

as significant as it has been in recent years, 

international commerce did indeed expand 

and will continue to expand. Last year in 

May, the Commission continued its efforts 

to address port congestion issues by launching 

the Supply Chain Innovation Teams Initiative, 

under the direction of Commissioner Rebecca 

Dye. In November, just seven months from 

their initiation, the teams identified an actionable project that, if funded, would make a 

real and meaningful contribution to improving supply chain system efficiencies and 

contribute to increased American economic 

competitiveness. 

Key regulatory actions taken by the Commission in FY 2016 included:

•  Issued a Final Rule on OTI licensing and financial responsibility 

requirements 

•  Launched an automated Agreement 

Filing System 

•  Launched an online registration and 

renewal system for unlicensed foreign-based NVOCCs

•  Invited public comment on a proposed 

rule on ocean common carrier and 

marine terminal operator agreements 

[Docket Number 16-04]
8 55th Annual Report

•  Invited public comment on a proposal 

to revise rules on service contracts and 

NVOCC service agreements [Docket 

Number 16-05]

Most notably, in June of last year the 

expanded Panama Canal opened. The $5.2 billion expansion of the Panama Canal began in 

2007 and significantly increases the maximum 

size of vessels that can transit the waterway 

(Panamax) to those capable of carrying 14,000 

Twenty Foot Equivalent Units (TEUs). By way 

of comparison, legacy Panamax vessels carry 

approximately 5,000 TEUs and the largest container ships in operation today have capacities 

in excess of 18,000 TEUs. Time will tell to what 

extent the larger Canal will impact the flow of 

containers, but ports along the Gulf of Mexico 

and up and down the Atlantic Coast are working to find ways to position their gateways as 

alternatives to the ports on the Pacific. 

Ports up and down the West Coast of the 

United States also saw vessels of the 18,000 

TEU class make calls for the first time. These 

ship visits were not part of a new service, but 

it did prove that facilities in Los Angeles, Long 

Beach, Oakland, and Seattle were all capable 

of receiving and servicing the largest vessels 

currently deployed in the commercial trades. 

It is reasonable to expect that, at some point, 

when market conditions warrant, we may see 

ships of this size included in regular service 

strings stopping in California and the State 

of Washington.

Container shipping and supply chain systems services are activities that take place 

invisibly, but are critical to the economic success and security of the United States. The 

information contained in the following pages 

will not only help an interested reader learn 

about the Commission’s work over the past 

year, but will help illustrate the irreplaceable 

contribution shipping makes to the quality of 

life enjoyed in the United States.

The following presents a detailed summary 

of the Commission’s activities during FY 2016.
55th Annual Report 9

Efficiency and Competition

Strategic Goal 1

Maintaining an efficient and competitive international ocean transportation system and 

enhancing liner trade by evaluating and monitoring the use of various types of agreement 

authority for anticompetitive effects is a primary function of the Commission. An efficient and 

competitive transportation system facilitates commerce, economic growth, and job creation. 

Competition among participants in U.S. liner trades fosters competitive rates and encourages 

a variety of service offerings for the benefit of U.S. exporters and importers, and ultimately 

consumers. 

The Shipping Act allows competitors to meet and discuss (and in some cases cooperate 

on) certain business issues, but first they must file a written agreement with the Commission. 

The Commission reviews agreements using traditional antitrust law and economic models to 

evaluate the potential competitive impact of a proposed agreement before it may go into effect. 

The initial review and analysis of a proposed agreement and subsequent monitoring of the 

members’ activities under the agreement, should it become effective, are designed to identify 

and guard against possible anticompetitive abuse of the filed authority, avoid unreasonable 

increases in transportation costs or decreases in transportation services, and address other 

activities prohibited by the Shipping Act. 

The Shipping Act is a federal competition law applicable to the industry of international 

liner shipping. It contains provisions similar to those found in the Sherman Act of 1890, the 

1914 Clayton Act, and the Robinson-Patman Act of 1936 concerning various prohibitions of 

discriminatory or unfair business practices and standards regarding business combinations. 

The Shipping Act creates a separate regulatory regime from antitrust under which collective 

carrier or MTO activity is both evaluated when the agreement is initially filed and closely 

monitored thereafter for any adverse impact on competition in the trade. 

So long as the regulated entities comply with the statutory and regulatory proscriptions 

of the Act, then the other federal antitrust statutes generally do not apply. Conversely, if a 

regulated entity violates the Shipping Act, they would be subject to penalties set forth in the 

Act, and may under certain circumstances be subject to investigation and prosecution under 

the full array of federal antitrust statutes.

Agreement Filings and Review

Under Sections 4 and 5 of the Shipping Act, 

all agreements by or among ocean common 

carriers to undertake any of the following are 

required to be filed with the Commission:

•  fix rates or conditions of service, 

•  pool cargo revenue, 

•  allot ports or regulate sailings, 
10 55th Annual Report

•  limit or regulate the volume or character of cargo or passengers to be carried, 

•  control or prevent competition, 

•  or engage in exclusive or preferential 

arrangements. 

Except for certain exempted categories, 

agreements among MTOs and among one or 

more MTOs and one or more ocean common 

carriers also must be filed with the Commission. Generally, an agreement becomes 

effective 45 days after filing, unless the 

Commission has requested additional information to evaluate the competitive impact of 

the agreement. All agreements are reviewed 

pursuant to the standard set forth in section 

6(g) of the Shipping Act, 46 U.S.C. §41307(b)

(1). Effective agreements are exempt from 

U.S. antitrust laws, and instead, are subject 

to Shipping Act restrictions and Commission 

oversight.

In FY 2016, the Commission received 251 

agreement filings. This volume of filing activity remains well above the ten-year average 

of 183 filings per year.

During FY 2016, the Commission undertook a sizeable effort to overhaul the intake 

process for ocean common carrier and marine 

terminal agreement filings to leverage new 

technologies. This effort included developing 

and deploying the new automated Agreement filing system and commencing efforts to 

replace the current online Agreement Library 

with a more robust system with expanded 

information and improved search capabilities. 

Types of Agreements

To support the new public-facing portion of 

the Agreement system, categories were added 

to describe the authority contained in filed 

agreements. The categories were developed 

to aid public research and agency reporting. 

While the following descriptions closely parallel many definitions in the Commission’s 

agreement rules, some of the descriptions 

below are more precise, i.e., equipment 

discussion agreement rather than non-rate 

discussion agreement. 

Some former categories have been subdivided for more targeted research results. For 

example, under the former system, all operational agreements were grouped together 

under the category of vessel sharing agreements (VSAs). Now the Commission can 

differentiate between types of space sharing 

agreements, allowing for a more accurate 

accounting of the industry.

Space charter agreements authorize an 

ocean common carrier(s) (also known as a 

shipping line(s)) to sell or exchange vessel 

space for use by another shipping line. Space 

charter agreements do not include the authority to discuss the provision of space in a trade, 

only the chartering of space already deployed.

Vessel sharing agreements authorize two 

or more shipping lines to discuss and agree 

on the supply of vessel capacity in a defined 

U.S. trade through the deployment of a specific service string.

Global vessel sharing agreements/alliances authorize two or more shipping lines 

to discuss and agree on the supply of vessel 

capacity across multiple trades. Alliance 

agreements may contain other authorities, 

such as, information exchange, joint procurement of goods or services necessary to operate 
55th Annual Report 11

their services, etc. Examples of this category 

of agreement include the recently filed THE 

and OCEAN alliances.

VOCC conference agreements are distinguished from all other types of agreements 

because they authorize two or more shipping 

lines to collectively discuss, agree, and fix 

uniform freight rates, charges, practices, and 

conditions of service relating to the receipt, 

carriage, handling and/or delivery of passengers or cargo. Conference agreements 

currently only involve the transport of government impelled cargo.

Joint service agreements authorize two or 

more shipping lines to establish and operate a 

combined vessel service or joint venture that 

uses a distinct operating name and generally 

acts as a single shipping line independent 

of the shipping lines in the joint service 

agreement.

Equipment discussion agreements are 

agreements between shipping lines that primarily focus on the discussion, exchange, and 

transportation of containers, chassis, LASH/

SEABEE barges, and related equipment. 

Examples of this type of agreement include 

OCEMA, and more recently, agreements 

that would allow for the movement of empty 

containers.

VOCC rate discussion agreements focus on 

any kind of rate matter or charges, but unlike 

conferences, any consensus on rates among 

the shipping line members is non-binding on 

the members.

VOCC cooperative working agreements 

(CWAs) authorize shipping lines to establish 

exclusive, preferential, or cooperative working 

relationships that are subject to the Shipping 

Act, but that do not fall precisely within the 

parameters of any other specifically defined 

agreement category. Many current CWAs deal 

with unique operating considerations relating to acquisitions, sharing of administrative 

services, or internet portal management.

Assessment agreements, whether part of a 

collective bargaining agreement or negotiated 

separately, authorize the parties to collectively bargain for fringe benefit obligations on 

other than a uniform man-hour basis regardless of the cargo handled or type of vessel or 

equipment utilized. These agreements can be 

between common carriers and labor organizations or marine terminal operators and labor 

organizations, and are effective upon filing 

with the Commission.

Marine terminal rate discussion agreements authorize marine terminal operators 

to discuss on a non-binding basis, rates and/or 

charges related to marine terminal operations.

Marine terminal facilities agreements

generally refer to lease agreements between 

a marine terminal operator and the owner of 

the land or warehouse/facility at a port. 

Marine terminal services agreements are 

agreements between a marine terminal operator and a shipping line that apply to marine 

terminal services that are provided to and paid 

for by a shipping line. These services include: 

checking, dockage, free time, handling, heavy 

lift, loading and unloading, terminal storage, 

usage, wharfage, and wharf demurrage and 

including any marine terminal facilities that 

may be provided incidentally to such marine 

terminal services. 

Marine terminal joint venture agreements 

are agreements between or among two or 

more marine terminal operators, or between 

one or more marine terminal operators and 
12 55th Annual Report

one or more shipping lines, operating as a 

joint venture whereby a separate marine terminal operator is established. 

MTO cooperative working agreements 

authorize marine terminal operators to establish exclusive, preferential, or cooperative 

working relationships that are subject to the 

Shipping Act, but that do not fall precisely 

within the parameters of any specifically 

defined agreement. Examples of MTO cooperative working agreements include the Port 

of New York/New Jersey Sustainable Services 

Agreement and the Port Fee Services Agreement at the Ports of Los Angeles and Long 

Beach, California.

As in previous years, the vast majority, 81 

percent of all VOCC agreements in effect at 

the end of the fiscal year were either space 

charter or vessel sharing agreements. However, VOCC rate discussion agreements 

remain active and continue to constitute a 

substantial portion of the Commission’s monitoring activities. Ocean common carriers have 

had greater success with cost cutting efforts 

in search of financial stability under vessel 

sharing agreements, as opposed to attempts 

at rate enhancement under rate discussion 

agreements, which were largely ineffective 

this year. 

Fiscal Year 2016 was the first year in the past 

five that the number of active VOCC agreements declined, this was primarily due to a 

Commission initiative seeking the termination of inactive agreements combined with a 

general consolidation of the shipping industry, 

through both the formation of new, larger alliances, and through mergers and acquisitions. 

Among the most notable of recent efforts were 

the formation or expansion of global alliance 

agreements, such as the 2M and OCEAN Alliance agreements.
55th Annual Report 13

In terms of acquisition and merger activities 

within the ocean transportation market, 2016 

saw several major developments. COSCO 

Container Line and China Shipping Container 

Lines combined their container operations 

into a single entity, the China COSCO Shipping Corporation, and in doing so, became 

one of the top five container carriers in the 

world as measured by vessel capacity. Also of 

note was CMA CGM’s purchase of Neptune 

Orient Line (NOL), including NOL subsidiaries APL/American President Lines. Hanjin 

Shipping’s bankruptcy and subsequent sale 

of its vessels added to industry consolidation. 

Based on industry consultant reports, there is 

a good possibility that 2017 will continue this 

trend towards a more concentrated market.

In FY 2016, the Commission’s new agreements system facilitated greater tracking of 

agreements within the Roll On-Roll Off (RO/

RO) market. Of the 324 VOCC agreements on 

file and in effect at the end of the fiscal year, 

106 agreements, or almost 33 percent, authorized cooperation between ocean carriers in 

the RO/RO trade. The Commission continues 

to see a trend this year toward space charter 

agreements between two RO/RO carriers with 

a global geographic scope. 

The flexibility required of car carriers to 

serve a wide range of locations is due partly 

to the shift of car manufacturing plant locations closer to end markets. Conversely, the 

closing of car manufacturing plants overseas 

has also contributed to an increase of vehicle 

imports into those countries. The worldwide 

scope of these agreements allows the carrier 

parties to respond to a vehicle market that 

has become increasingly diverse and mobile.

Competitive Impact and Monitoring

The Commission reviews all agreements 

filed under the Shipping Act as well as 

evolving commercial conditions in the U.S. 

foreign trades to ensure that cooperation contemplated between or among ports, ocean 

common carriers, and/or MTOs will not result 

in an unreasonable reduction 

in service or increase in rates. 

The following are examples 

of specific measures the 

Commission took during the 

fiscal year on carrier or MTO 

agreements to ensure compliance with the Shipping Act. 

The Los Angeles and Long Beach 

Port Infrastructure and Environmental Programs Cooperative Working 

Agreement: 

This agreement allows the Ports to jointly 

form Supply Chain Optimization Working 

Groups that meet periodically 

to discuss possible measures 

designed to expedite the 

flow of containers moving 

through the Ports’ terminals, including utilizing key 

performance indicators, container terminal optimization 

and drayage actions. Pursuant 

to the Agreement’s monitoring requirements, 

the Commission receives reports on the activities of these various working groups. The 

Growing vessel supply/

demand imbalance drives a 

continued wave of mergers, 

acquisitions, joint ventures 

& increased cooperation 

among carriers.
14 55th Annual Report

Commission monitors the Agreement’s activities and the major issues being discussed by 

the working groups.

The West Coast MTO Agreement 

(WCMTOA):

The Commission continued to actively monitor and evaluate the activities conducted by 

the thirteen container terminals at the Ports 

of Los Angeles and Long Beach to assess 

their competitive impacts under the section 

6(g) standard of the Shipping Act. Notable in 

the fiscal year were three programs that the 

Commission closely evaluated: the PierPASS 

program, a proposed Chassis Hosting Agreement, and a proposed assessment of a Chassis 

Services Fee. 

As part of its evaluation, Commission 

staff met with various shippers, truckers, 

intermodal equipment providers, and trade 

associations who have raised concerns about 

existing and proposed programs under the 

agreement. Commission staff also met with 

Port and PierPASS officials and agreement 

parties. 

Of major concern to the Commission as well 

as stakeholders has been the annual increase 

in the Traffic Mitigation Fee and lack of transparency about the cost to operate off-peak 

shifts, the revenue collected from the traffic 

mitigation fee, and quality of service. The 

Commission has urged WCMTOA to address 

stakeholders’ concerns by conducting an independent audit of the PierPASS program.

Oakland MTO Agreement: 

In FY 2015, the Commission issued a 

Request For Additional Information (RFAI) 

regarding a proposed amendment to establish OAKPASS, a program that would have 

allowed the container terminals at the Port 

of Oakland to offer Saturday gate times. The 

cost of providing Saturday gate operations 

would be recovered by imposing a fee on shippers and truckers using the Monday through 

Friday daytime gates. Responses to the RFAI 

would allow staff to undertake a competitive 

impact analysis of the proposed program. 

Staff also met with Port of Oakland officials to discuss the proposed program and 

the concerns raised by shippers, truckers and 

organized labor. Responses to Commission’s 

RFAI remained pending at the end of the fiscal 

year, and therefore the proposed revised program has not been implemented. 

However, the largest terminal member 

of the agreement announced that it would 

independently offer fee based weeknight gate 

operations and another terminal member is 

separately experimenting with night gates to 

ascertain whether it is feasible to offer them 

on a regular basis.

Transpacific Stabilization Agreement 

(TSA): 

As part of the 2003 settlement agreement 

between the Commission and TSA members, 

biannual meetings are held with representatives of TSA to review major activities of the 

Agreement and discuss significant developments in the ocean liner trade between the U.S. 

and Asia. TSA is also required to provide periodic reports for review and analysis regarding 

each member’s performance and activities.

Over the last five years, a number of factors have converged to prompt carriers both 

to form alliances under the Shipping Act and 

to consolidate. While cargo volumes have 

increased, the rate of increase has slowed significantly since the end of the Great Recession 
55th Annual Report 15

of 2008-2009. During the nine years prior 

to 2008, U.S. container transport volumes 

increased at an average annual rate of 7 percent, or about 1.5 million TEUs annually. Since 

then, cargo volumes have grown at an annualized rate of only 2.5 percent, or about 750,000 

TEUs annually.

This slower than expected growth in the 

global economy and reduced overall demand 

for liner shipping services, coupled with 

the ongoing deployment of mega container 

ships (ordered during a period of consistently 

healthy cargo growth) has impacted the financial stability of liner carriers. Vessel capacity 

growth has consistently outpaced weak cargo 

demand growth since 2012. The introduction 

of ultra-large ships without corresponding 

cargo demand growth has resulted in supply 

outstripping demand, and downward pressure on ocean freight rates. 

Faced with this growing vessel supply/

demand imbalance, FY 2016 witnessed a 

continued wave of mergers, acquisitions and 

joint ventures; as well as increased cooperation among vessel operators under the 

Shipping Act. At the close of 2015, most of 

the major ocean carriers were members of one 

of four alliances (2M, CKYHE, G6 and Ocean 

3). During the fiscal year however, these 

four alliances and their members began to 

sort themselves into three new alliances: 2M, 

OCEAN Alliance, and THE Alliance (to be 

filed in FY 2017). 

Maersk/MSC Vessel Sharing Agreement (2M Alliance): 

The 2M Alliance consists of Maersk Line 

and Mediterranean Shipping Company. The 

Commission monitored alliance activities, 

capacity, and utilization levels. It is anticipated that Hyundai will join this agreement 

during FY 2017.

OCEAN Alliance Agreement:

The OCEAN Alliance was the first of the 

three newly announced global ocean carrier 

alliances to file its agreement with the Commission. The OCEAN Alliance members are 

COSCO, CMA CGM, Evergreen Line and 

OOCL. At the end of fiscal year, the Commission issued an RFAI to obtain a fuller and 

more detailed explanation of how the parties 

intend to use their agreement authority, and 

to gather necessary data to undertake a competitive impact analysis. 

THE Alliance: 

THE Alliance was discussed but not filed 

with the Commission during the fiscal year. 

THE Alliance consists of Hapag-Lloyd, K Line, 

MOL, NYK and Yang Ming. It includes Japan’s 

three major shipping lines, K Line, NYK, and 

MOL. THE Alliance will allow its members to 

share vessels, charter and exchange space on 

each other’s ships, and enter into cooperative 

working arrangements.
16 55th Annual Report

Tariffs, Service 

Contracts, NSAs, & 

MTO Schedules

Tariffs

The Shipping Act requires common carriers and conferences to publish their tariffs 

containing rates, charges, rules, and practices, 

electronically in private systems. For ease of 

public access, the Commission publishes the 

web addresses of those tariffs on its website. 

At the close of the fiscal year, 5,560 tariff location addresses were posted. Of that number, 

5,233 tariff addresses were for NVOCCs.

The Commission provides regulatory relief, 

allowing licensed and foreign registered 

NVOCCs to “opt out” of the requirement 

to file rate tariffs when exclusively using 

NVOCC Negotiated Rate Arrangements 

(NRAs). NRAs are a less burdensome compliance option which NVOCCs indicate save 

them both time and money. At the end of the 

fiscal year, nearly 1,400 active NVOCCs or 

27 percent, had filed prominent notices or a 

rule in their respective tariff indicating that 

they had invoked the NRA exemption as an 

alternative to tariff filing. Approximately 12 

percent of all NVOCCs use NRAs exclusively, 

while 15 percent use a combination of NRAs 

and tariff rate filings. 

Service Contracts

Service contracts are an alternative to transportation of cargo under tariff rates. Between 

90 and 95 percent of the total cargo transported in the major U.S. liner trades moves 

under service contracts, rather than tariffs. 

Service contracts enable the parties to tailor 

transportation services and rates to their commercial and operational needs and to keep 

these arrangements confidential. During the 

fiscal year, the Commission received 52,968 

new service contracts, compared to 51,109 in 

fiscal year 2015, and 734,106 contract amendments, compared to 653,315 in FY 2015. 

NVOCC Service Arrangements (NSAs)

Commission rules allow NVOCCs to offer 

transportation services pursuant to individually negotiated, confidential service 

arrangements with customers, rather than 

under a published tariff. During the fiscal year, 

the Commission received 984 NSAs, compared to 901 in fiscal year 2015, and 1,814 NSA 

amendments, compared to 1,790 in FY 2015. 

During the fiscal year, a total of 96 NVOCCs 

took advantage of the ability to use NSAs to 

conclude their transportation arrangements 

with shippers. Historically 1,856 NVOCCs 

have registered with the Commission to file 

NSAs, however, only 273 NVOCCs (approximately 15 percent) have ever actually filed an 

NSA.

Service Contracts and 

NSAs filed in 2015

Newly filed service contracts: 51,109

Amendments to service contracts: 

653,315

Newly filed NSAs: 901

Amendments to NSAs: 1,790
55th Annual Report 17

Marine Terminal Schedules

An MTO may make available to the public 

a schedule of rates, regulations, and practices, 

including limitations of liability for cargo loss 

or damage, pertaining to receiving, delivering, 

handling, or storing property at its marine 

terminal. An MTO schedule made available 

to the public is enforceable by an appropriate 

court as an implied contract without proof of 

actual knowledge of its provisions. During 

the fiscal year, 257 MTOs maintained an 

active Form FMC-1, which reports the electronic location of an MTO’s terminal schedule, 

with 154 MTOs electing to voluntarily publish 

their actual terminal schedules. The internet 

address of these MTO terminal schedules are 

posted on the Commission’s website.

Supply Chain Innovation Initiative

On February 1, 2016, the Commission issued 

an Order directing Commissioner Rebecca 

Dye to engage leaders from commercial sectors of the U.S. international supply chain in 

discussions to identify commercial solutions 

to U.S. supply chain operational challenges. 

The Supply Chain Innovation Teams (SCIT) 

initiative was an outgrowth of the Commission’s previous work on port congestion 

issues in the fall of 2014, and in its initial phase 

focused on the U.S. import trades associated 

with America’s three largest container seaports – the ports of Los Angeles, Long Beach, 

and New York/New Jersey.

Under the Commission Order, Commissioner Dye convened three teams of industry 

leaders to develop process innovations that 

would enhance supply chain reliability and 

resilience. Each of the teams was composed of 

roughly a dozen representative supply chain 

organizations, including public port authorities, marine terminal operators, beneficial 

cargo owners, ocean transportation intermediaries, liner shipping companies, drayage 

trucking companies, longshore labor representatives, rail officials and chassis providers.

The SCIT approach stressed two fundamental factors: innovation and teamwork. By design, 

it encouraged creative interaction among committed participants operating within small 

teams that engaged in candid give-and-take 

dialogue and debate. During the planning 

stage Commissioner Dye sought advice from 

a variety of academic and business experts in 

supply chain management, process innovation, transportation research and the use of 

business teams.

By April, three teams, totaling 34 volunteer 

industry leaders, had been established. Their 

initial meeting took place on May 3 and 4 in 

Washington, D.C. At the project launch, the 

team members were encouraged to step outside 

their individual enterprise silos and consider 

the international supply chain from an overall systemic

perspective. They 

were also 

directed 

to identify one 

innovative 

supply 

chain 

process 

Supply Chain Innovation 

Teams agree that availability 

of timely and accurate critical information is needed to 

enhance visibility and promote supply chain efficiency
18 55th Annual Report

improvement and develop 

a plan to implement that 

improvement. 

In response, all three teams 

determined that improved 

supply chain visibility would 

be their central focus. They 

agreed that the availability 

of timely and accurate critical 

information was needed to 

achieve the desired enhanced 

visibility and promote supply 

chain efficiency. Consequently, identifying each 

supply chain actor’s unmet 

critical information needs 

became the primary focus of 

each team’s discussions.

Similarly, each team concluded that timely access by 

all supply chain actors to relevant critical information via a 

national seaport portal should 

be their overall goal. Viewing information technology 

as "the new infrastructure," 

the teams debated how best 

to provide the right information, to the right person, at the 

right time, in order to more 

fully integrate and harmonize 

the supply chain system.

Subsequent discussions 

occurred in smaller industry 

sub-groups to resolve particular operational challenges that interfered 

with effective communication. The focus of 

these meetings related to terminal coordination with trucking companies and chassis 

providers.

By the close of FY 2016, the teams had 

nearly completed their lists of: (a) the critical information/data needs of the various 

actors; (b) likely sources of that information; 

(c) timing requirements; and (d) the expected 

Commissioner Rebecca F. Dye presenting from the bench.
55th Annual Report 19

operational improvements that likely would 

result from the parties’ access to that critical 

information. A final meeting of phase one’s 

import teams was scheduled for mid-October.

By the start of FY 2017 the participants had 

largely completed their detailed consideration 

of high-priority information needs – mainly 

dealing with port/marine terminal operations, 

such as container availability, chassis availability, and more efficient drayage trucking 

operations.

The availability of this critical information 

is expected to help all supply chain actors 

achieve greater system-wide visibility, and 

link their organizations’ behavior in ways that 

better integrate the supply chain and produce 

improved reliability and resilience across the 

entire system.

By October, initial plans were also underway 

for phase two of the supply chain initiative. 

It is expected to involve both the creation of 

three "export" teams that will begin meeting 

in early 2017; as well as a continued effort 

to pursue options for the development of a 

robust pilot project concerning a national seaport information portal to provide the needed 

critical information.
20 55th Annual Report

International Cooperation

U.S.-China Bilateral Maritime Agreement Consultations & 8th U.S.-China 

Transportation Forum

Chairman Mario Cordero and the FMC 

General Counsel participated in the 2016 

U.S.-China Bilateral Maritime Agreement Consultations, which took place in Los Angeles, 

CA in June. The consultations were government-to-government exchanges between 

relevant agencies from the United States and 

China with jurisdiction over shipping issues. 

Chairman Cordero co-lead the delegation 

and engaged his Chinese counterparts on 

matters related to the consolidation of Chinese shipping lines, changes in the alliance 

structures, the status of China COSCO Shipping as a "Controlled Carrier", and NVOCC 

bond recognition.

Taking place concurrently to the Bilateral 

Maritime Consultations was the 8th U.S.-

China Transportation Forum, a ministerial 

level bilateral meeting that covered policy 

issues related to all modes of transportation. 

Chairman Cordero engaged in sessions that 

addressed congestion, port productivity, environmental initiatives, and technology.

Chairman Mario Cordero witnesses the signing of the minutes of the U.S.-China Bilateral 

Maritime Consultations. 
55th Annual Report 21

U.S.-Korea Bilateral Maritime 

Consultation

Commissioner Michael Khouri, accompanied by the FMC General Counsel, traveled 

to the Republic of Korea as a member of the 

U.S. delegation for consultations with officials from the Ministry of Oceans & Fisheries 

in June 2016. Commissioner Khouri engaged 

in government-to-government informational 

dialogues and participated in a tour of a key 

port facility in that country. 

The delegation conducted discussions with 

the Vice Minister and other senior officials 

from the Ministry of Oceans & Fisheries where 

a number of issues of reciprocal interest were 

addressed, including matters related to carrier 

alliances, which are the jurisdiction of the Federal Maritime Commission. These discussions 

were held in Sejong City. The delegation also 

had a meeting with U.S. Ambassador Mark 

Lippert in Seoul and visited marine terminal facilities in Incheon, where they had the 

opportunity to inspect the Sun Kwang Newport container terminal.

U.S.-Japan Bilateral Maritime Meeting 

Commissioner Daniel Maffei and FMC 

staff participated in a U.S.-Japan Bilateral 

Maritime Meeting, hosted by the U.S. Delegation in August 2016. U.S. and Japanese 

Commissioner Michael A. Khouri visits the Sun Kwang Newport container terminal at 

the Port of Incheon as a member of the US Delegation. 
22 55th Annual Report

officials discussed many mutual issues and 

shared insights on the global maritime landscape. Officials discussed such topics as the 

global alliances, antitrust regulatory system 

review, ocean carrier agreements and antitrust exemption systems, the Panama Canal 

expansion, environmental issues, and an 

exchange program between the U.S. Maritime Administration and the Japan Maritime 

Bureau. Participants agreed that coordination 

on these maritime issues is valuable for promoting mutual interests in international ocean 

transportation and commerce.

Trade In Services Agreement 

Negotiations

On behalf of the Commission, the Office of 

the General Counsel (OGC) acted as a maritime technical advisor to two ongoing trade 

negotiations, Trade in Services Agreement 

(TiSA) and Transatlantic Trade and Investment Partnership (T-TIP).

Commissioner Daniel B. Maffei at the bench
55th Annual Report 23

Protecting the Public

Strategic Goal 2

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

including licensing and registering of ocean transportation intermediaries; helping resolve 

disputes about the shipment of goods or the carriage of passengers; investigating and prosecuting unreasonable or unjust practices, and ruling on private party complaints alleging Shipping 

Act violations. These activities contribute to the integrity and security of the nation’s import 

and export supply chains and ocean transportation system. In addition, the FMC ensures 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.

Licensing

OTIs are transportation middlemen for 

cargo moving in the U.S.-foreign ocean-borne 

trades. There are two types: NVOCCs and 

ocean freight forwarders (OFFs). An NVOCC 

is a common carrier that holds itself out to the 

public to provide ocean transportation, issues 

its own house bill of lading or equivalent 

document, but does not operate the vessel by 

which ocean transportation is provided. An 

ocean freight forwarder domiciled in the U.S. 

arranges for the transportation of cargo with a 

common carrier on behalf of shippers and processes documents related to those shipments. 

Both NVOCCs and OFFs must be licensed 

by the Commission if they are located 

in the U.S. and must establish financial 

responsibility. NVOCCs doing business in 

the U.S.-foreign trades but located outside 

the U.S. (foreign NVOCCs) may choose to 

become FMC-licensed, but are not required 

to do so. If not licensed under the FMC’s program, foreign-based NVOCCs must register 

with the Commission and establish financial 

responsibility. 

NVOCCs wishing to serve in the U.S.-

China trade may file an Optional Rider for 

Additional NVOCC Financial Responsibility, 

to meet the Chinese government's financial 

responsibility requirements. This rider adds 

additional financial liability to meet the bond 

aggregate amount of $125,000 and is available 

to pay fines and penalties for activities in the 

U.S.-China trades that may be imposed by the 

Chinese government. 

Licensing Activity in FY 2016

• New OTI applications accepted: 373

• Amended applications accepted: 283

• New OTI licenses issued: 309

• Amended licenses issued: 113

• Licenses revoked or voluntarily 

surrendered: 293
24 55th Annual Report

This rider is accepted as a convenience 

to U.S. NVOCCs. During the fiscal year, 44 

China Bond Riders were received and 32 were 

terminated. 

At the close of the fiscal year, 450 U.S. 

NVOCCs held China Bond Riders.

Revisions to Licensing Rules

During the fiscal year, the Commission 

concluded its Rulemaking proceeding in 

Docket 13-05, adopting revisions to the Ocean 

Transportation Intermediary regulations at 46 

C.F.R. Part 515 after considering the extensive comments submitted to its earlier Notice 

of Proposed Rulemaking (NPR). The Final 

Rule is designed to adapt to changing industry conditions, improve regulatory oversight, 

improve transparency, streamline FMC business processes, and reduce regulatory burdens 

on the industry. Among other revisions, most 

significantly the Final Rule provides:

•  a requirement to renew licenses and 

registrations every three years through 

an on-line and user-friendly process;

•  a requirement that common carriers 

verify OTI licenses and registrations, 

tariff publication and financial responsibility, provided such verifications 

can be made at a single location on 

the Commission’s website; and

•  a new expedited hearing procedure 

that would streamline the current 
55th Annual Report 25

procedures for denial, revocation 

or suspension of an OTI license.

The Final Rule was published in the Federal Register on November 5, 2015 (80 FR 

68722-68742), effective December 9, 2015, 

except the renewal requirements, which 

became effective December 9, 2016. 

Passenger Vessel Program

The Commission administers the passenger 

vessel operator (PVO) program as described 

under 46 U.S.C. §§ 44102-44103, requiring evidence of financial responsibility for vessels 

which have berth or stateroom accommodations for 50 or more passengers and embark 

passengers at U.S. ports and territories. 

Certificates of performance cover financial 

responsibility used to reimburse passengers in 

the event their cruise is cancelled. Certificates 

of casualty are required to cover liability that 

may occur for death or injury to passengers or 

other persons on voyages to or from U.S. ports.

At the close of FY 2016, 225 vessels owned 

by 47 passenger vessel operators were certified under the Commission’s program. The 

combined evidence of financial responsibility for nonperformance of transportation for 

all cruise vessels in the program is $594 million. Under the Commission’s program, $705 
26 55th Annual Report

million in aggregate financial responsibility 

for casualty coverage is evidenced under the 

Commission’s program. During the fiscal 

year, 16 new performance certificates and 14 

casualty certificates were issued. No cruise 

operator stopped operation with unperformed 

cruises during this fiscal year.

The maximum coverage requirement is currently $30 million per cruise line. The cap is 

adjusted every two years based on the Consumer Price Index for All Urban Consumers 

(CPI-U). The next adjustment is set for 2017.

Consumer Affairs and 

Education

Dispute Resolution

The Commission, through its Office of 

Consumer Affairs and Dispute Resolution 

(CADRS) provides alternative dispute resolution (ADR), ombuds, and mediation services, to 

assist parties in resolving international ocean 

shipping and cruise disputes, including a 

Rapid Response Team especially focused on 

addressing problems exporters may encounter. Such services are available to the shipping 

public at any stage of a dispute, regardless of 

whether litigation has been filed at the FMC 

or another jurisdictional forum. 

The Commission’s ADR services help parties avoid the expense and delay inherent in 

litigation, and facilitate the flow of U.S. foreign 

commerce. This fiscal year, the Commission 

closed a total of 641 ombuds matters: 180 

involved household goods; 331 cargo other 

than household goods; 126 cruise; and 4 miscellaneous matters, the total representing a 12 

percent increase from the previous fiscal year. 

Ten mediation matters were also conducted.

The Commission, through CADRS, continued to assist parties that encountered disputes 

relating to port congestion encountered on 

the east and west coasts and assisted parties 

affected by the sudden dissolution of Hanjin 

shipping line – during the fiscal year, CADRS 

responded to 53 such requests.

The Commission published consumer 

alerts on the Commission’s website to assist 

shippers and staff gave various educational 

presentations to industry and consumer trade 

associations regarding regulatory compliance, 

best practices, and the use of alternative dispute resolution to resolve regulatory and 

commercial ocean transportation disputes.

PVO Participants

• 47 PVOs are certified

• 225 vessels are certified 

• 16 new Casualty Certificates issued 

in FY 2016

• 14 new Performance Certificates 

issued in FY 2016

PVO Program Coverage

• $594 million aggregate evidence 

of financial responsibility for 

nonperformance

• $705 million aggregate evidence 

of financial responsibility for 

casualty
55th Annual Report 27

Area Representatives

Area Representatives (ARs) are officials who 

represent the FMC at regional field offices 

located in Southern California, South Florida, New Orleans, New York, Houston and 

Seattle. They investigate alleged violations 

of the shipping statutes, resolve complaints 

and disputes between parties involved in 

international oceanborne shipping (often coordinating with CADRS staff), and participate in 

local maritime industry groups. ARs provide 

advice and guidance to the shipping public, 

collect and analyze trade information, and 

assess industry conditions.

During the fiscal year, ARs conducted outreach to the public, consumer groups, trade 

associations, and worked with other Federal, state and local government agencies to 

achieve and enhance regulatory compliance 

and protect the public from financial harm. 

They also made presentations to interested 

industry audiences in their regions, explaining 

OTI licensing requirements, bonding requirements, and OTI compliance with tariff filing 

requirements and provisions application to 

NRAs.

Enforcement, Audits and Penalties

The Commission’s Bureau of Enforcement 

(BOE) staff and ARs work to obtain compliance with the shipping statutes administered 

by the Commission to ensure equitable trading conditions in the foreign oceanborne 

commerce of the United States. 

During the fiscal year, staff investigated and 

prosecuted possible illegal practices in many 

trade lanes, including the Transpacific, North 

Atlantic, Middle East, South American and 

Caribbean trades. These market-distorting 

activities included various forms of unfiled 

agreements, rebates and absorptions, misdescription of commodities, and unlawful use of 

service contracts, as well as carriage of cargo 

by and for untariffed and unbonded NVOCCs. 

At the beginning of the fiscal year, 15 enforcement cases were pending final resolution, BOE 

was party to 1 formal proceeding, and there 

were 7 matters pending which BOE was monitoring or providing internal legal advice. The 

ARs referred 22 new investigative matters for 

enforcement action or informal compromise; 

24 matters were compromised and settled, 

administratively closed, or referred for formal 

proceedings; and 12 enforcement cases were 

pending resolution at fiscal year’s end. Two 

new formal proceedings were initiated; 1 

formal proceeding was completed, and 2 were 

pending at the end of the fiscal year. 

Major investigations undertaken or completed during the fiscal year addressed VOCCs 

seeking to operate pursuant to agreements that 

were not filed with the Commission, as well 

as deceptive or fraudulent practices of certain OTIs operating in the China-U.S. inbound 

trades. Of note, significant efforts in pursuing 

inquiries regarding certain car carriers in the 

Japan/South Korea/China-U.S. trade, EuropeU.S. trade and in other U.S. trades, resulted 

in a joint settlement with Wallenius Wilhelmsen Logistics AS and Eukor Car Carriers, Inc., 

which included payment of $1.5 million in 

civil penalties. The car carrier investigations 
28 55th Annual Report

spawned an additional $170,000 settlement 

with Volkswagen Konzernlogistiks GmbH 

& Co. related to unfiled carrier agreements. 

Also of note, in October 2015, the Commission ordered Washington Movers, Inc., a 

licensed OTI to show cause why the Commission should not revoke its license due to 

the felony weapons smuggling convictions of 

its qualifying individual and various alleged 

regulatory violations. The matter is pending 

before the Administrative Law Judge. 

The Formal Investigations section of this 

report includes more information on formal 

proceedings concluded during the fiscal year. 

Cumulatively, the Commission collected $3.3 

million in penalties which were deposited 

directly into the U.S. Treasury General Fund. 

Most of these investigations were resolved 

informally, some with compromise settlements and civil penalties. A list of parties and 

penalties can be found in Appendix D.

The Commission’s compliance audit program reviews the operations of licensed OTIs 

in order to assist them in complying with 

the statutory requirements and the Commission’s rules and regulations. The 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 (including audits carried over from FY 

2015), and 15 remained pending at the close 

of the fiscal year. 

Inter-Agency Cooperation

The Commission regularly works with 

a number of other federal, state, and local 

transportation and law enforcement agencies, either through established memoranda 

of understanding (MOU), collaborations or 

partnerships to address specific transportation 

related policies, issues or incidents in both 

the U.S. domestic shipping arena and international liner shipping. 

Under the MOU between the FMC and the 

Federal Motor Carrier Safety Administration 

(FMCSA), Commission staff continued to 

participate in the FMCSA’s Moving Fraud Task 

Force and Moving Fraud 

Partnership initiatives. 

CADRS and the Commission’s ARs worked with 

FMCSA on two matters 

involving ocean transportation intermediaries that 

had their licenses revoked 

and subsequently failed to 

deliver shipments. In the 

first matter, the agencies 

worked together to locate 

FMC works with Federal Partners to Protect 

the Public:

Federal Motor Carrier Safety 

Administration

Federal Bureau of Investigation

Alcohol, Tobacco and Firearms 

(DOJ)

Customs and Border Patrol 

(DHS)

Immigration and Customs 

Enforcement (DHS)

Joint Terrorism Task Force

Census Bureau (DOC)

Coast Guard

Export-Import Bank
55th Annual Report 29

a missing shipment that contained medical 

supplies for a seriously ill child. In the second 

matter, the agencies worked together with a 

foreign consulate office to attempt to locate a 

missing household goods shipment.

Interaction between the Commission and 

the U.S. Customs and Border Protection (CBP) 

on the exchange of investigative information continues to be beneficial to all parties. 

Cooperation with CBP included staff interactions and joint field operations to investigate 

entities suspected of violating both agencies’ 

statutes or regulations. Such cooperation also 

has included local police and other government entities, including the U.S. Attorney’s 

Office, Federal Bureau of Investigation, and 

Immigration and Customs Enforcement, when 

necessary. 

The Commission completed its fourth year 

under a formal MOU with the Census Bureau, 

U.S. Department of Commerce, which provides the FMC with access to the Census’ 

Automated Export System (AES) database. The 

Commission uses the AES database to review 

confidential U.S. export shipment data for law 

enforcement purposes. The Commission also 

continued its membership in the Homeland 

Security Investigations-led National Intellectual Property Rights Coordination Center 

Commissioner William P. Doyle presents to FMC staff
30 55th Annual Report

(IPR Center), a partnership of 21 Federal and 

international agencies targeting intellectual 

property- and trade-related crimes.

The ARs continued to work closely with a 

number of law enforcement agencies, including local police jurisdictions in New York, 

New Jersey, South Florida and Houston, in 

matters relating to international shipping, 

such as the export of stolen motor vehicles. 

They also participated in various enforcement 

initiatives sponsored by Federal law enforcement agencies: the U.S. Department of Justice 

(DOJ), Alcohol, Tobacco and Firearms (ATF); 

FBI; the Department of Homeland Security 

(including CBP and ICE); the Joint Terrorism 

Task Force (JTTF); Department of Commerce; 

Coast Guard; Export-Import Bank; and the 

FMCSA. These activities included criminal 

and civil investigations of entities licensed or 

regulated by the Commission, interdiction of 

illicit imports and exports, consultation on carrier practices, procedures and documentation 

relating to shipping and international trade, 

and coordinated action seeking to protect the 

shipping public from deceptive and unfair 

practices. 

The FMC actively participates in the U.S. 

Committee on the Marine Transportation 

System (CMTS), a partnership of Federal 

departments and agencies with responsibility 

for the Marine Transportation System (MTS). 

The CMTS is authorized by Congress to assess 

the adequacy of the MTS and coordinate 

Federal maritime policy amongst the many 

Federal maritime interests. The Chairman sits 

on the Committee’s Cabinet-level Committee 

and the Commission is represented on the 

sub-Cabinet Coordinating Board and in the 

work of the various CMTS Integrated Action 

Teams and Task Teams.

Through CADRS, the Commission participates and takes a leadership role in the 

Interagency ADR Working Group (IADRWG) 

and this year led a long-term project to develop 

a Spectrum of Collaborative Processes to 

meet the needs of federal agencies that are 

exploring and implementing new collaborative dispute prevention and resolution tools. 

CADRS staff also led an effort to develop an 

interagency panel discussion which explored 

new mediation convening techniques and the 

implementation of other ADR tools to assist 

disputing parties. CADRS also assisted with a 

report on federal ADR to be issued in FY 2017 

by the DOJ and the IADRWG.

Leveraging Technology

The Commission continues to prioritize 

information technology (IT) investments to 

improve information security, efficiency, and 

greater public access, while reducing costs 

over time. New online services were developed and launched through the Commission's 

public website during the fiscal year that 

automated two paper-based filing systems, 

simplifying stakeholder interaction with the 

Commission; eliminating paper, postage or 

courier costs; and providing faster publication 

of information on the FMC's website. 

Foreign-based unlicensed NVOCCs may 

now renew their FMC registrations (Form 

FMC-65) via an online process, and vesseloperating common carriers and marine 

terminal operators have a new Agreements 

system option to electronically file agreements 
55th Annual Report 31

for Commission review. Both systems allow 

faster publication of critical information used 

by the shipping public to make business decisions about a particular NVOCC or general 

awareness about a newly filed agreement for 

which there may be interest in filing comments with the Commission.

The FMC is implementing its Information 

Technology Capital Plan, focusing on completing major upgrades to internal IT systems to 

improve data support and efficiency for all 

Commission programs and research projects, 

to simplify stakeholder interaction and filing 

processes, and to ensure that the FMC’s systems meet cybersecurity best practices. Work 

continued on the Enterprise Content Management platform, and work was started on 

a major project to make extensive improvements to the information architecture of the 

Commission’s public website. 
32 55th Annual Report
55th Annual Report 33

Developments in Major 

U.S. Foreign Trades

Worldwide

The world’s container trade expanded by 

just 1 percent in fiscal year 2016 compared to 

growth of 3 percent in 2015. As the fiscal year 

ended, 371 container ships lay idle, representing nearly 7 percent of the total fleet capacity 

measured in TEUs. In contrast, 243 ships or 4 

percent of the containership fleet capacity lay 

idle at the end of fiscal year 2015.

Due to a number of liner carrier mergers 

and acquisitions, the world’s container shipping industry became more concentrated 

during the fiscal year. The top three container 

operators controlled 39 percent of the world’s 

containership capacity; the top five controlled 

52 percent; and the top ten controlled 67 percent. A.P. Moller-Maersk A/S (15 percent), 

Mediterranean Shipping Company SA (14 

percent) and CMA CGM S.A. (11 percent) 

continued to hold the top three positions in 

terms of vessel capacity deployed.

Container volumes in U.S. liner trades 

during the fiscal year expanded by only 1 

percent to 31.9 million TEUs, compared to 

31.5 million last year. The U.S. share of the 

world’s container trades was 16.9 percent. U.S. 

container imports expanded slightly by 1.6 

percent to 20.4 million TEUs, compared to 20 

million in 2015. This was the third consecutive 

year that U.S. imports surpassed the pre-Great 

Recession record of 18.6 million TEUs reached 

in FY 2007. 

U.S. container exports increased by less than 

1 percent to nearly 11.5 million TEUs. This 

was a significant improvement over the 5 percent contraction witnessed during the same 

period last year. As a result, the U.S. container 

imbalance worsened only slightly; for every 

100 loaded containers exported from the U.S., 

177 were imported, compared to 175 imported 

in FY 2015.

Worldwide

• For the seventh consecutive year, 

worldwide container trade grew – 

expanding by 1 percent.

• Continuing global vessel overcapacity 

is indicated as the number of 

container ships that lay idle increased 

by more than half by year’s end. 

• The world’s top 3 operators controlled 

39 percent of the worldwide vessel 

capacity.

U.S. Liner Trades

• Container volumes in the U.S. 

liner trades (imports and exports 

combined) grew for the seventh 

consecutive year.

• Imported cargo continued to outpace 

exports which worsened the U.S. 

container imbalance slightly.
34 55th Annual Report

The world’s container ship fleet expanded 

slightly with nominal capacity growing by 

approximately 3 percent. At the end of the 

fiscal year, 5,148 container ships, with a total 

fleet capacity of 20.3 million TEUs, were available to serve the world’s container trades and 

there were orders worldwide for 432 new 

container ships with an aggregate capacity 

of 3.3 million TEUs - 16 percent of the existing 

fleet capacity. Vessels with nominal capacities 

exceeding 10,000 TEUs comprised 25 percent 

of the existing container ship fleet capacity 

and 81 percent of the orderbook fleet capacity 

at year-end, reflecting the continued increasing size of containerships being ordered.

Asia

In terms of container cargo volumes, Asia 

is our largest trading partner. The U.S. traded 

19.9 million TEUs with the region in FY 2016 

(exports and imports combined), representing 

61 percent of total U.S. container 

trade. The U.S. imports substantially more container cargo 

from the region than it exports. 

In FY 2016, the U.S. imported 

13.9 million TEUs of goods from 

Asia, a 1.7 percent increase over 

the previous fiscal year, while 

the U.S. exported almost 6 million TEUs, an increase of about 

1.5 percent over the same period. 

Fifty-one percent of U.S. container trade was 

with Northeast Asia (China, Japan, South 

Korea, Taiwan, and Hong Kong). Countries 

in Southeast Asia (Brunei, Cambodia, Indonesia, Malaysia, the Philippines, Singapore, 

and Vietnam) collectively accounted for 10 

percent of total U.S. trade in 2016.

More than half of all imports from Asia 

flowed through the ports of Los Angeles and 

Long Beach. U.S. West Coast ports collectively handled almost two-thirds of all Asian 

imports and exports. U.S. East and Gulf Coasts 

collectively handled almost 35 percent or 7 

million TEUs worth of goods arriving from 

or destined to Asia. Of note, the largest containership to call in the U.S., the CMA CGM 

Benjamin Franklin, with a capacity of 17,859 

TEUs, made three trips across the Pacific to the 

U.S. West Coast to demonstrate the 

feasibility of deploying ships of 

this size in the Asia-U.S. trade.

The Transpacific Stabilization 

Agreement (TSA) is the major 

rate discussion agreement in the 

transpacific trade encompassing the inbound and outbound 

transpacific container trades. Its 

geographic scope includes portions of the Indian Subcontinent 

(i.e., Bangladesh, Pakistan and Sri Lanka, but 

not India or the Middle East). During the fiscal 

year, the thirteen TSA members’ share of the 

trade between the U.S. and Asia remained 

steady at 90 percent despite losing two members during the fiscal year. 

This reduction was due to the merger of 

China Shipping with COSCO, and the exit of 

K Line from the Agreement. Two more carriers 

are expected to resign from TSA (NYK Line 

and Hanjin Shipping), leaving eleven TSA 

members. Hanjin Shipping declared bankruptcy during the last quarter of the fiscal year, 

the largest in 30 years; while Japan’s three 

Asia accounts for 

nearly 68% of containerized imports to the 

U.S.; and about half of 

containerized exports 

from the U.S
55th Annual Report 35

major ocean carriers, NYK Line, MOL, and K 

Line announced plans to spin off their respective container divisions and merge them in 

July 2017. 

Indian Subcontinent and Middle East 

The Indian Subcontinent and Middle East 

regions combined accounted for over 6 percent of total U.S. container volumes in FY 

2016, with the Indian Subcontinent being the 

larger of the two. U.S. container trade with 

the Indian Subcontinent alone (exports and 

imports combined) grew by 7.2 percent, totaling about 1.35 million TEUs. Both imports and 

exports contributed to the rise in trade with 

the region. The U.S. imported 809,000 TEUs 

from the Indian Subcontinent, an increase of 2 

percent from the prior year. American exports 

to the countries in this region grew to 536,000 

TEUs, an increase of over 16 percent compared 

to 2015. 

In contrast, overall trade between the U.S. 

and the Middle East shrank slightly over the 

past year, declining by almost 2 percent to 

about 770,000 TEUs, due to fewer exports 

to the region. In FY 2016, the U.S. exported 

551,000 TEUs to the Middle East, a decrease 

of over 5 percent compared to the prior year. 

Although U.S. imports of Middle Eastern 

goods increased by almost 9 percent over 

the year, totaling 218,000 TEUs, that increase 

was not enough to make up for the decrease 

in exports, and thus, overall trade with the 

Middle East declined.

In this region, TSA is the rate discussion 

agreement covering part of the U.S. inbound 

and outbound container trades. For the fiscal 

year, TSA’s market share for the trade between 

the U.S. and Bangladesh, Pakistan, and Sri 

Lanka was 92 percent. These three countries 

collectively comprise approximately 380,000 

TEUs of U.S. trade; India being by far our 

largest trading partner in the region, with 

combined imports and exports total roughly 

950,000 TEUs. There are no other rate discussion agreements covering the trade lanes 

between the U.S. and India or the Middle East.

North Europe

In FY 2016, cargo volume between the U.S. 

and North Europe grew at less than 1 percent in both trade directions in comparison 

to the preceding period. The decision of the 

U.K. to exit the European Union caused the 

British pound to plummet against the U.S. 

dollar, which hampered U.S. container export 

growth. A decline in U.S. imports of European 

During FY 2016, 9 out of 10 containers between the US and Asia 

were moved by a TSA carrier.

U.S. trade with the Indian Subcontinent and Middle East 

experienced contrasting trends 

in FY 2016: trade with the former 

region expanded, while trade with 

the latter region contracted.
36 55th Annual Report

automobiles, in particular Volkswagen, also 

caused a slump in U.S. container imports of 

European auto parts. 

In addition, progress in concluding the 

Transatlantic Trade and Investment Partnership which was anticipated to contribute to a 

growth in trade, is presently uncertain. The 

cargo volume carried by MSC, Hapag Lloyd, 

CMA CGM, and Maersk Line accounted for 58 

percent of the total trade. The supply of vessel 

capacity contracted by 13 percent in both trade 

directions, while average vessel utilization 

was 83 percent inbound and 59 percent outbound. By the end of the fiscal year, freight 

rates in both trade directions had declined 

markedly in comparison to the previous year.

In contrast to the prior fiscal year when carrier services were introduced or expanded in 

the trade, ocean carriers made service modifications that removed vessel capacity. In July 

2016, for example, CMA CGM, Hamburg Sud, 

and United Arab 

Shipping reduced 

the pendulum 

(Vespucci) service 

operated under 

their vessel sharing agreement to 

a loop (Liberty 

Bridge) service. 

Additionally, carrier parties to the 2M 

and G6 Alliances terminated their TA4 and 

AX4 loop services, respectively, due to slack 

demand.

Mediterranean

Conditions in the container cargo market 

between the U.S. and the Mediterranean 

remained mixed, as the volume of U.S. container exports to the region declined by 

5 percent in fiscal year 2016 compared to 

the preceding period, while U.S. container 

imports from the region rose by 8 percent. 

Import containers exceeded export containers 

by a ratio of 2.25 to 1. Major imported commodities included wine, ceramic tiles, and 

furniture, while wood pulp, paper, nuts and 

cotton were some of the top U.S. export commodities in the trade. The volume of cargo 

carried by MSC, Hapag Lloyd, Maersk Line, 

and CMA CGM accounted for 75 percent of 

the total trade. 

During the year, a new weekly loop service was added to the trade. In February 2016, 

the Hanjin/UASC/CMA CGM/COSCON Vessel 

Sharing Agreement was formed, establishing 

the jointly operated Amerigo Express service 

between U.S. Atlantic ports and ports in Italy, 

France, Spain, and Malta. 

The agreement supersedes a jointly operated pendulum service that was originally 

partnered with China Shipping but reconfigured after COSCO absorbed the carrier. Also, 

Hanjin Shipping discontinued operations in 

September 2016 after the carrier was granted 

court receivership in South Korea. Due primarily to the launch of this new weekly 

service, the supply of vessel capacity in the 

trade increased by 10 percent by the end of 

the fiscal year. 

Freight rates to and 

from North Europe 

declined markedly 

compared to previous year.
55th Annual Report 37

Australia and Oceania

The Oceania trade includes the nations and 

territories of Australia, New Zealand, Papua 

New Guinea, Western Samoa, and other South 

Pacific Islands. Compared to the preceding 

fiscal year, U.S. container exports to the region 

declined by 4 percent, and container imports 

to the U.S. declined by 5 percent. Container 

exports exceeded imports by a ratio of 1.37 to 

1. Container imports of meat and wine, the top 

commodities from the region, accounted for 

33 percent of the total import cargo volume. 

The cargo volume carried by Hamburg Sud, 

ANL Singapore Ptd. Ltd. (a subsidiary of 

CMA CGM), Hapag Lloyd, and Maersk Line 

accounted for 64 percent of the total trade.

There are two main rate discussion agreements in the trade, the United States/Australasia 

Discussion Agreement (USADA) in the outbound direction, and the Australia and New 

Zealand-United States Discussion Agreement

(ANZUSDA). During the fiscal year, a number 

of carriers withdrew from the rate discussion agreements in the trade. In June 2016, 

Compagnie Maritime Marfret S.A. (Marfret) 

and Hapag Lloyd withdrew from USADA, 

reducing the trade share of the agreement 

from 75 percent to 64 percent. Also in 2016, 

Maersk Line and Hapag Lloyd withdrew from 

ANZUSDA, reducing the trade share of the 

agreement from 96 percent to 76 percent. In 

the Pacific Islands, Marfret and CMA CGM 

exited from the Pacific Island Discussion Agreement in June 2016, reducing the trade share of 

the agreement from 81 percent to 37 percent.

Africa

The volume of containerized cargo between 

the U.S. and the nations in Africa dropped by 

0.2 percent in FY 2016, which was a significant 

deceleration in the drop in volumes experienced in the previous two years. 

The volume of containerized cargo had 

dropped by 6 percent in FY 2015 and 4.3 percent in FY 2014. Compared to the previous 

year, U.S. exports to the nations of Africa 

increased by 1.8 percent while U.S. imports 

from Africa declined by 4.7 percent. 

Nevertheless, because the total volume of 

exports to the nations of Africa continued to 

substantially exceed imports from the region, 

the volume of containerized cargo between the 

U.S. and Africa still fell slightly; for every one 

container moving inbound from the nations in 

Africa to the U.S., a little more than 2.5 containers moved outbound 

from the U.S. 

Major U.S. export 

commodities to 

African nations 

during the period 

included automobiles and poultry, 

while cocoa bean 

and citrus fruit were 

among the top import commodities. The 

Republic of South Africa is the largest U.S. 

liner trading nation on the continent, accounting this year for about 25 percent of the 

containerized cargo. 

Major U.S. exports 

to African nations 

included automobiles and poultry.
38 55th Annual Report

Approximately 67 percent of the container 

cargo in the trade was carried by MSC and 

Maersk Line (including Maersk Line’s subsidiary, Safmarine). Under the Southern 

Africa Agreement, MSC and Maersk continue 

to share space on each other’s ships in the 

America Express (AMEX) service between 

the U.S. Atlantic Coast and the Republic of 

South Africa with calls at Cape Town, Port 

Elizabeth, and Durban.

Central America and the Caribbean

In FY 2016, U.S. export cargo volumes to 

Central America increased by 5 percent to 

641,000 TEUs and U.S. import cargo volumes increased by almost 3 percent to 770,000 

TEUs. Paper and paperboard (including waste 

paper) accounted for the largest share of U.S. 

containerized exports. Other major export 

commodities included fabrics, yarns, and raw 

cotton. Grocery products, used automobiles 

and apparel were also significant exports. On 

the import side, fresh fruit made up a majority of all imports from the region. Roughly 

three quarters of fresh fruit imports consisted 

of bananas. The second largest commodity 

imported from this region was clothing and 

apparel.

Five of the largest regional carriers in the 

U.S./Central America trade participated in the 

Central America Discussion Agreement (CADA): 

Seaboard Marine, Crowley Latin America Services, King Ocean Services, Dole Ocean Cargo 

Express, and Great White Fleet Liner Service 

Ltd. 

In the liner trade between the U.S. and the 

Caribbean, U.S. exports, mainly of food, consumer goods, and manufactured products 

increased just over 1 percent to 519,000 TEUs. 

Imports to the U.S. decreased just over 1 percent to approximately 163,000 TEUs.

Carriers in the U.S./Caribbean trade participated in two rate discussion agreements 

covering geographically discrete trades: (1) 

the Aruba Bonaire and Curacao Discussion 

Agreement, and (2) the Caribbean Shipowners 

Association.

South America

The volume of containerized cargo between 

the U.S. and South American nations decreased 

by about 1.5 percent in FY 2016. While imports 

to the U.S. from South America continued to 

grow at about 8 percent as it had done in the 

previous fiscal year, exports to South America 

declined almost 11 percent, which was a significantly larger decrease than in the previous 

two fiscal years. 

For every ten containers moving inbound 

from countries in South America to the U.S., 

less than nine containers moved outbound 

from the U.S. 

Major U.S. export commodities to South 

America included automobile parts and 

chemical products, while bananas, wood, and 

coffee were among the top import commodities. Brazil and Chile are the largest U.S. liner 
55th Annual Report 39

trading nations on the continent, accounting 

this year for about 53 percent of the containerized cargo moving to and from the U.S.

Members of the West Coast of South America Discussion Agreement (WCSADA) carried 

79 percent of container cargo exports from 

the U.S. to the West Coast of South America, 

and nearly 62 percent of imports to the U.S. 

from the West Coast of South America. The 

members of this agreement consist of three 

regional carriers (Seaboard Marine, Trinity 

Shipping, and King Ocean Services) and four 

global carriers (CMA-CGM, Hamburg Sud, 

Hapag-Lloyd, and MSC). 

Independent carriers offering service outside of WCSADA included Dole Ocean Liner 

Express and Great White Fleet, which mainly 

transport proprietary cargo such as fresh 

fruits and vegetables. WCSADA also faces 

competition from other major carriers serving the trade through transshipment hubs in 

Mexico, Panama, and the Caribbean. There 

were no active rate discussion agreements in 

the trade between the U.S. and the East Coast 

of South America.

Tanga Fitzgibbon and Gary Kardian of the Bureau of Trade Analysis
40 55th Annual Report
55th Annual Report 41

Top Twenty U.S. Liner Cargo 

Trading Partners

The Foreign Shipping Practices Act requires 

the FMC include in its annual report to Congress “a list of the twenty foreign countries 

which generated the largest volume of oceanborne liner cargo for the most recent calendar 

year in bilateral trade with the United States,” 

46 U.S.C. § 306 (b)(1).

The Journal of Commerce’s Port Import 

Export Reporting Service (PIERS) database 

was used to derive the Commission’s list of 

top-twenty trading partners. The most recent 

complete calendar year for which data are 

available is 2015. Table 1 on the next page lists 

the twenty foreign countries that generated 

the largest volume of oceanborne liner cargo 

in bilateral trade with the United States in 

2015. The figures in the table represent each 

country’s total U.S. liner imports and exports 

combined in thousands of loaded TEUs.

Bilateral trade with the United States’ toptwenty liner trading partners increased to near 

80 percent of the nation’s total liner trade in 

2015. The total volume of trade with our toptwenty liner trading partners increased by 2 

percent year-to-year. 

Membership of the top-twenty list has 

remained the same since 2009. This year, 

however, several changes in ranking occurred 

among the top-twenty countries. Reflecting 

the greatest year-to-year liner volume increase 

of 16 percent, Vietnam rose above Germany 

and India in the rankings to occupy 5th place. 

Germany and India dropped one rank each 

to 6th and 7th with 6 percent and 3.9 percent 

increase in volume respectively. Belgium and 

Luxembourg also rose in the rankings to 8th 

place, trading places with Hong Kong which 

slipped to 9th with the greatest decrease in 

volume of -8.7 percent. Brazil dropped two 

rank positions from 10 to 12 and was one 

of 6 countries that experienced lower liner 

cargo volumes this year (the others being 

Hong Kong, Taiwan, Japan, Australia, and 

Netherlands). 

Vietnam, Belgium and Luxembourg, 

Indonesia and Italy climbed up in the 

rankings, while Germany, India, Brazil 

and Hong Kong slipped down slightly 

in the ratings.
42 55th Annual Report

Top Twenty U.S. Liner Cargo Trading Partners 

(FY2015 Imports and Exports)

Rank Country TEUs 

(000)

1 China (PRC) 12,156

2 Japan 1,352

3 South Korea 1,339

4 Taiwan (ROC) 1,058

5 Vietnam 1,017

6 Germany 985

7 India 919

8 Belgium & 

Luxembourg

655

9 Hong Kong 1 637

10 Indonesia 579

11 Italy 577

12 Brazil 576

13 Thailand 561

14 Netherlands 498

15 United Kingdom 436

Rank Country TEUs 

(000)

16 Guatemala 419

17 Chile 371

18 Malaysia 364

19 Honduras 356

20 Australia 327

1 Hong Kong reverted to Chinese control in July 1997. 

However, PIERS continues to report data separately 

for Hong Kong due to its status as a major transshipment center.
55th Annual Report 43

Foreign Shipping Practices Act

The Commission has the authority to 

address restrictive foreign shipping practices 

under section 19 of the Merchant Marine Act 

of 1920 and the Foreign Shipping Practices 

Act of 1988 (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. 

The Commission, both through Commission 

action and through its Office of the General 

Counsel (OGC), informally pursued several 

matters involving potentially restrictive foreign practices. This included interpretations 

of existing legislation, foreign legislation and 

administrative law, and regulations of nondomestic carriers’ terminal handling charges. 

No formal FSPA action by the Commission 

was necessary.

Tyler Wood, General Counsel, and William Shakely, Deputy General Counsel
44 55th Annual Report

Controlled Carriers

A controlled carrier is an ocean common 

carrier that is, or whose operating assets are, 

owned or controlled directly or indirectly by 

a foreign government. The Shipping Act provides that no controlled carrier may maintain 

rates or charges in its tariffs or service contracts that are below a level that is just and 

reasonable, nor may any such carrier establish, 

maintain, or enforce unjust or unreasonable 

classifications, rules or regulations in those tariffs or service contracts. In addition, tariff rates, 

charges, classifications, rules, or regulations of 

a controlled carrier may not, without special 

permission of the Commission, become effective sooner than the 30th day after the date of 

publication. The Commission’s staff monitors 

U.S. and foreign trade press and other information sources to identify controlled carriers 

and any unjust or unreasonable controlled 

carrier activity that might require Commission action. In FY 2016, six controlled carriers 

operated in the U.S. trades:

1. American President Lines, Ltd. and APL 

Co., Pte. – Republic of Singapore

2. COSCO Container Lines Company, Ltd. 

- People’s Republic of China

3. China Shipping Container Lines Co., 

Ltd. and China Shipping Container 

Lines (Hong Kong) Company, Ltd. - 

People’s Republic of China

4. Hainan P.O. Shipping Co., Ltd. – People’s Republic of China

5. CNAN Nord SPA – People's Democratic 

Republic of Algeria

6. United Arab Shipping Co. SAG – State 

of Qatar
55th Annual Report 45

Formal Investigations, Private 

Complaints and Litigation

Adjudicative proceedings before the Commission are commenced by the filing of a complaint, 

or by order of the Commission upon petition, or upon its own motion. Types of docketed 

proceedings include:

• Private complaints: Any person may file a formal complaint alleging violations of specific 

sections of the Shipping Act found at 46 U.S.C. Chapter 411. Formal complaints are 

generally assigned to an Administrative Law Judge (ALJ) who issues an initial decision 

which is reviewed by the Commission.

• Small claims complaints: For claims of $50,000 or less, an informal complaint may be 

filed. The complaint is handled by a settlement officer for resolution using informal 

procedures that do not tend to include discovery or motions practice.

• Investigative proceedings: The Commission may investigate the activities of ocean 

common carriers, OTIs, MTOs, and other persons to ensure effective compliance with 

the statutes and regulations administered by the Commission. Formal orders of investigation and hearing are assigned to an ALJ for an initial decision and may be reviewed 

by the Commission.

In FY 2016, 12 new private party complaints and 1 small claims complaint were filed and 

1 new formal investigation was instituted. The Office of Administrative Law Judges (OALJ) 

issued 10 initial decisions, including 1 initial decision on default, 1 initial decision awarding 

attorney, 3 initial decisions approving full settlement, and 1 initial decision approving partial 

settlements. The Commission issued notices finalizing the ALJ’s decisions in 4 private complaint 

cases and 1 investigative proceeding. Two ALJ’s decisions were affirmed in whole or in part 

by the Commission on exceptions or its own review, and 5 proceedings remained pending 

before the Commission.

The Commission’s final issuances in these and other matters are detailed below.

The following summarizes the results of docketed proceedings concluded during FY 2015 

by the ALJs and the Commission.
46 55th Annual Report

Formal Investigations

John T. Barbour t/d/b/a Barbour Auto 

Group, Barbour Auto Sales, Barbour 

Shipping, and Barbour Shipping 

and Transportation Inc. – Possible 

Violations of Section 8 and 19 of the 

Shipping Act of 1984, [Docket No. 

15-03]

On May 27, 2015, the Commission issued 

an Order of Investigation and Hearing to 

determine whether Respondents, a licensed 

OTI, violated the Shipping Act by operating 

as a non-vessel-operating common carrier 

(NVOCC): (1) without keeping open for public 

inspection a tariff containing rates, charges, 

rules, and practices in violation of section 

8 of the Shipping Act, 46 U.S.C. § 40501; (2) 

without a license issued by the Commission 

in violation of section 19(a), 46 U.S.C. § 40901; 

and (3) without filing evidence of financial 

responsibility in violation of section 19(b), 46 

U.S.C. § 40902. Respondents did not respond 

to the Order and failed to respond to an order 

to show cause. On January 20, 2016, the ALJ 

issued an initial decision on default imposing 

a civil penalty and ordering Respondent to 

cease operating as an NVOCC. On February 

23, 2016, the Commission issued a Notice Not 

to Review.

Private Complaints

Yakov Kobel and Victor Berkovich 

v. Hapag-Lloyd A.G., Hapag-Lloyd 

America, Inc., Limco Logistics, Inc., 

and International TLC, Inc. [Docket 

No. 10-06]

This proceeding was initiated by a complaint 

filed with the Commission on July 6, 2010, 

alleging that Respondents violated various 

sections of the Shipping Act. After discovery, 

an evidentiary hearing, and briefing, on February 14, 2012, an Initial Decision was issued 

dismissing the complaint. On July 12, 2013, the 

Commission issued an Order Vacating Initial 

Decision In Part and Remanding for Further 

Proceedings. On July 30, 2014, the ALJ issued 

an Initial Decision on remand finding that the 

Respondents violated 46 U.S.C. § 41102(c), 

and ordering that the Respondents be jointly 

and severally liable to the Complainants for 

a reparation award of $126,072. On August 

12, 2014, the Commission served a notice that 

it would review the decision. Exceptions to 

the ALJ’s decision were filed on September 

22, 2014. On May 26, 2015, the Commission 

entered an order imposing liability on several 

respondents, including Limco Logistics, Inc., 

and International TLC, Inc. Limco requested 

that the Commission reconsider its decision. 

The Commission denied reconsideration on 

May 5, 2016. Complainants filed a petition 

for attorney fees, which is pending before the 

Commission.

Maher Terminals, LLC v. The Port 

Authority of New York and New Jersey 

[Docket No. 12-02]

On March 30, 2012, Maher Terminals, LLC, 

filed a complaint against the Port Authority 

alleging numerous violations of 46 U.S.C. 

§§ 41102(c), 41106(1), 41106(2), 41106(3) 
55th Annual Report 47

involving the Port Authority’s change-ofcontrol practices, preferential treatment of 

ocean-carrier-affiliated terminals, lease terms, 

letting of a parcel adjoining the Global terminal, and preferential treatment of another 

terminal operator. On January 30, 2015, the 

ALJ granted the Port Authority’s motion to 

dismiss the complaint for failure to state a 

claim. The Commission affirmed the ALJ’s 

dismissal of ten of the counts and reversed 

the ALJ as to four counts, which the Commission remanded for further proceedings 

on December 18, 2015. On September 30, 2016, 

the parties jointly moved for approval of a 

settlement agreement and dismissal of this 

case and Docket No. 08-03. 

Edaf Antillas, Inc. v. Crowley Caribbean Logistics, LLC; IFS International 

Forwarding, S.L.; and IFS Neutral 

Maritime Services [Docket No. 14-04]

On April 28, 2014, Edaf Antillas filed a 

complaint with the Commission alleging that 

Respondents violated the Shipping Act by permitting non-compliant cargo to be placed in a 

container with compliant cargo causing delay 

of Edaf Antillas’s shipment and by failing to 

correct the problem in a timely manner after 

the container arrived in Puerto Rico. On April 

15, 2015, the ALJ issued an Initial Decision 

dismissing the proceeding for failure to prosecute. The Initial Decision also addressed the 

applicability of a new provision in the Shipping Act permitting an award of attorney fees 

to a prevailing party. On May 18, 2015, the 

Commission issued a Notice Not to Review 

the dismissal. Prevailing Respondents filed 

petitions for attorney fees to be decided by the 

ALJ pursuant to 46 C.F.R. § 502.254. On October 15, 2015 the ALJ issued an Order granting 

Respondents’ petitions for attorney fees. The 

Commission issued a Notice to Review the 

petitions for attorney fees. The Commission 

affirmed in part and reversed in part the ALJ’s 

decision, granting attorney fees for work performed subsequent to the implementation of 

the new statutory provision.

Santa Fe Discount Cruise Parking, Inc., 

d/b/a EZ Cruise Parking, Lighthouse 

Parking, Inc., and Sylvia Robledo d/b/a 

81st Dolphin Parking v. The Board of 

Trustees of the Galveston Wharves 

and the Galveston Port Facilities Corporation [Docket No. 14-06]

Respondents operate the cruise terminal 

at the Port of Galveston. Complainants operate parking facilities near the Port where 

they provide parking for passengers who 

embark on cruises from the cruise terminal. 

As part of their service, Complainants provide 

transportation to the Port. On June 16, 2014, 

Complainants filed a complaint alleging that 

Respondents’ tariff imposing charges on Complainants’ shuttles transporting passengers to 

and from the terminal violated three sections 

of the Shipping Act. 

On November 21, 2014, the ALJ granted 

Respondents’ motion to dismiss claims under 

two sections of the Act, but denied dismissal of 

claims under 46 U.S.C. § 41106(2), finding that 

the Complaint stated a claim that Respondents 

gave an undue or unreasonable preference or 

advantage or imposed an undue or unreasonable prejudice or disadvantage with respect 

to Complainants. On December 23, 2014, the 

Commission issued a Notice Not to Review 

the partial dismissals and the decision became 

administratively final.
48 55th Annual Report

On December 4, 2015, the ALJ issued an 

Initial Decision dismissing Complainants’ 

remaining claim regarding section 41106(2). 

Complainants and Respondents filed their 

Exceptions and Reply to the Exceptions on 

January 11, 2016, and February 2, 2016, respectively. The proceeding is pending before the 

Commission.

Econocaribe Consolidators, Inc. v. 

Amoy International, LLC, [Docket No. 

14-10]

On August 11, 2014, Econocaribe Consolidators, Inc. filed a complaint alleging that 

Respondent Amoy International, LLC violated 

numerous sections of the Shipping Act and 

Commission regulations in connection with 

shipment of auto parts detained by Chinese 

customs. On September 9, 2014, Amoy filed its 

Answer denying the allegations. The parties 

engaged in discovery, filed numerous motions, 

and briefed the merits of the proceeding. The 

parties eventually reached a settlement agreement that they submitted for approval. On 

September 2, 2015, the ALJ issued an Initial 

Decision Approving Joint Settlement and 

Granting Motion to Dismiss. On October 5, 

2015, the Commission issued a Notice Not to 

Review and the decision became administratively final.

Baltic Auto Shipping, Inc. v. Michael 

Hitrinov a/k/a Michael Khitrinov and 

Empire Unite Lines Co., Inc. [Docket 

No. 14-16]

On November 28, 2014, Baltic filed a complaint alleging that on several thousand 

shipments between November 2007 and January 2012, Empire, an NVOCC, violated several 

sections of the Shipping Act, 46 U.S.C. §§ 

41102, 41104, 40501, and 46 C.F.R. Part 515, by 

charging rates not set forth in a tariff, charging 

Baltic rates greater than rates charged other 

shippers, and by failing to provide Baltic with 

shipping documents. Baltic sought a reparation award. All shipments began and almost all 

were delivered more than three years before 

Baltic filed its complaint. Empire moved for 

a summary decision dismissing the claim for 

a reparation award, arguing that the claim 

was barred by the statute of limitations. On 

September 15, 2015, the ALJ held that based 

on the material facts not in dispute, Baltic’s 

claims accrued more than three years before 

Baltic filed the complaint and were barred. It 

was also determined that no other relief was 

warranted, and the complaint was dismissed.

Complainant filed Exceptions and a supporting brief on January 15, 2016. Subsequently, 

Respondents filed their reply to the Complainant’s Exceptions on March 3, 2016. On August 

15, 2016, Complainant filed a Motion to Withdraw Appeal and Discontinue Action and also 

filed a status report. Respondents submitted 

a separate status report in which they stated 

that they would not agree to the joint stipulation to withdraw the appeal. On August 30, 

2016, Respondents submitted a response to 

the motion. At the close of FY 2016, the motion 

was pending before the Commission.

General Motors, LLC v. Nippon Yusen 

Kabushiki Kaisha [Docket No. 15-08]

On September 2, 2015, Complainant General Motors, LLC (GM) filed a Shipping Act 

complaint against Respondents Nippon 

Yusen Kabushiki Kaisha (NYK), Wallenius 

Wilhelmsen Logistics AS (WWL) and Eukor 

Car Carriers, Inc. (Eukor). GM alleged that 

Respondents violated numerous provisions 
55th Annual Report 49

of the Shipping Act by secretly agreeing to 

rig bids, allocate customers, restrain capacity, and otherwise fix, raise, stabilize, and 

maintain prices for vehicle carrier services. 

The ALJ granted the parties’ joint motion to 

stay the case, and on July 25, 2016, GM, WWL, 

and Eukor moved for approval of a settlement agreement and dismissal of the case 

against those respondents. The ALJ granted 

the motion on July 29, 2016. The Commission 

determined to review the Initial Decision on 

August 26, 2016, and ordered the settling parties to submit additional information, which 

they did on September 1, 2016. On September 

12, 2016, GM and NYK filed a joint motion to 

approve a settlement agreement. As of the end 

of FY 2016, the GM-WWL-Eukor settlement 

was pending before the Commission, and the 

GM-NYK settlement was pending before the 

ALJ. 

Combustion Store Ltd. v. UniGroup 

Worldwide, Inc. [Docket No. 15-02]

On May 1, 2015, Combustion Store Ltd. 

filed a Complaint alleging that UniGroup 

Worldwide, Inc., an ocean transportation 

intermediary (OTI), violated 46 U.S.C. § 

41102(c), 46 U.S.C. § 41102(c), when it transported a Combustion shipment from Newnan, 

Georgia, to London, England. On March 7, 

2016, Combustion filed Complainant’s Consent Motion to Dismiss with Prejudice that 

the parties supplemented on March 10, 2016, 

with a Release of All Claims and Indemnity 

Agreement signed by the parties. On March 

14, 2016, the ALJ issued an initial decision 

approving the settlement agreement. On April 

14, 2016, the Commission issued a Notice Not 

to Review and the decision became administratively final.

Crocus Investments, LLC and Crocus, 

FZE v. Marine Transport Logistics, Inc. 

and Aleksandr Solovyev a/k/a Royal 

Finance Group Inc. [Docket No. 15-04]

On May 27, 2015, the Crocus parties filed a 

complaint alleging that Marine Transport, a 

licensed NVOCC, and Solovyev, the former 

husband of the owner of Marine Transport, 

violated 46 U.S.C. § 41102(c) when handling 

three boats. Two boats were shipped from the 

United States to Dubai in two separate shipments, then returned from Dubai to the United 

States in one shipment. One boat was never 

shipped internationally. On June 17, 2016, 

the ALJ issued an Initial Decision dismissing the Complaint because Crocus did not 

prove that Respondents violated the Shipping 

Act on the two shipments from the United 

States to Dubai, Crocus did not prove that 

Respondents operated as an OTI on the one 

shipment from Dubai to the United States, and 

the Commission does not have jurisdiction 

over the claims regarding the boat that was 

not shipped internationally. On July 6, 2016, 

the Commission granted Crocus’ motion to 

extend time to file exceptions. The time to file 

exceptions has been extended to October 27, 

2016.

Goodwin International Ltd v. Air Sea 

International Forwarding Inc. and Ray 

Tobia [Docket No. 15-07]

On August 27, 2015, Goodwin International Ltd filed a complaint against Air Sea 

International Forwarding Inc. and Ray Tobia 

alleging that in connection with delivery of 

Goodwin’s imports, Respondents violated 

46 U.S.C. § 41102(c), 46 C.F.R. § 515.11(a)(1), 

and 46 C.F.R. § 515.31(e) by collecting from 

Goodwin “for the correct duty rate at 5%, [but] 
50 55th Annual Report

paying the U.S. Customs through the Customs 

broker a lower rate at 2%, 3% or zero” and by 

“filing of false and fraudulent documentation.” 

On October 7, 2015, the Commission issued a 

Notice of Voluntary Dismissal. 

KSB Shipping & Logistics LLC v. 

Direct Container Line a/k/a Vanguard 

Logistics [Docket No. 16-03] 

On February 5, 2016, KSB Shipping filed 

a complaint against Direct Container Line 

alleging that Direct Container Line violated 

46 U.S.C. § 41102(c) in connection with cargo 

shipped from the United States to Austria 

allegedly released to the consignee without 

obtaining the original bill of lading. On March 

25, 2016, Respondent filed a motion to dismiss KSB Shipping’s complaint. On April 28, 

2016, Respondent’s motion to dismiss was 

denied. On May 9, 2016, Respondent filed its 

verified answer and affirmative defenses to 

the complaint. On August 11, 2016, the parties 

filed a Joint Submission in Support of Motion 

for Settlement and Voluntary Dismissal. On 

August 24, 2016, an Initial Decision Approving Confidential Settlement and Dismissing 

Proceeding with Prejudice was issued. On 

September 25, 2016, a Notice Not to Review 

was issued by the Commission and the decision became administratively final.

T. Parker Host, Inc. v. Kinder Morgan 

Liquids Terminals, LLC, et al. [Docket 

No. 16-14]

On June 21, 2016, T. Parker Host, Inc. (TPH) 

filed a complaint against Kinder Morgan, 

Inc., and fourteen of its subsidiaries. The 

complaint alleged that Respondents violated 

46 U.S.C. § 41106, by imposing a “Blacklist 

Notice” banning TPH from physically accessing vessels moored at Kinder Morgan marine 

terminals and from coordinating port calls at 

Kinder Morgan marine terminals. On August 

19, 2016, the parties filed a confidential Agreement settling their dispute and a joint motion 

asking for approval of the Agreement. On 

August 26, 2015, an Initial Decision approving 

the agreement and dismissing the proceeding 

without prejudice was issued. On September 

27, 2016, the Commission issued a Notice Not 

to Review and the decision became administratively final. 

Walter Muzorori v. Canada States 

Africa Lines Inc. (CSAL) [Docket No. 

1949(F)]

Claimant Walter Muzorori filed a small 

claim for informal adjudication under Subpart 

S alleging that Canada States Africa Lines, Inc. 

(“CSAL”) violated 46 U.S.C. §§ 41102(b)(2) and 

41102(c) when it did not honor an agreement 

to change the port of delivery of a shipment 

of two vehicles from Cape Town, South Africa, 

to Walvis Bay, Namibia. Respondent CSAL 

filed an objection to proceeding under Subpart 

S and asserted that there was no modification of the contract; the cargo was delivered 

to the port indicated on the bill of lading; and 

the expenses claimed were not established. 

An Initial Decision dated December 23, 2015, 

found that CSAL violated section 41102(c), did 

not find a violation of section 41102(b)(2), and 

awarded reparations of $6,405.60. On January 

5, 2016, the Commission issued a determination to review and on July 14, 2016, the 

Commission issued an Order affirming the 

Initial Decision.
55th Annual Report 51

Litigation

The following docket matters were litigated 

during the fiscal year in United States Courts 

of Appeals by the Office of the General Counsel (OGC) on behalf of the Commission.

Lisa Anne Cornell and G. Ware Cornell, Jr. v. Princess Cruise Lines, Ltd. 

(Corp), Carnival plc, and Carnival Corporation, [Docket No. 13-02], United 

States Court of Appeals for the District 

of Columbia Circuit

On January 30, 2013, complainants filed a 

complaint alleging that Respondent cruise 

ship lines refused to permit them to sail on 

their cruise ships in violation of section 10(b)

(10) of the Act, 46 U.S.C. § 41104(10). The 

controversy stemmed from a dispute over a 

refund of money paid to a fine arts auction 

company that operates on the cruise ships after 

Lisa Cornell cancelled a purchase of works of 

art. Complainants had been involved in litigation for several years in Florida courts with 

the auction company, an affiliate of the cruise 

lines. Respondents filed a motion to dismiss 

or alternatively for summary judgment. On 

July 23, 2013, the ALJ issued a summary Initial 

Decision dismissing most claims, but found 

that respondent Princess violated section 10(b)

(10) and entered a cease and desist order. The 

ALJ found that Complainants did not meet 

their burden of offering evidence that they had 

suffered actual injury as a result of the violation. On August 14, 2013, both parties filed 

exceptions to the decision. On August 28, 2014, 

the Commission issued an Order reversing in 

part, affirming in part, and vacating in part the 

Initial Decision and dismissing the complaint 

with prejudice on the ground that Princess 

Cruise Lines and other respondents did not 

violate the Shipping Act. The Complainants 

filed a Petition for Review in the D.C. Circuit, 

and the parties filed briefs. Oral argument 

took place on October 2, 2015. On December 

2, 2015, the D.C. Circuit denied the Petition 

for Review and afforded Chevron deference 

to the Commission’s statutory interpretation.

Maher Terminals, Inc. v. The Port 

Authority of New York and New Jersey 

[Docket No. 08-03], United States 

Court of Appeals for the District of 

Columbia Circuit 

Maher leases a marine terminal from the 

Port Authority, and on June 3, 2008, Maher 

filed a Shipping Act complaint alleging that 

the Port Authority: (a) violated 46 U.S.C. § 

41106(2) by granting another terminal operator, APM Terminals North America, Inc. 

(APM) unduly and unreasonably more favorable lease terms than it provided Maher; (b) 

violated 46 U.S.C. § 41102(c) by failing to 

establish, observe, and enforce just and reasonable regulations regarding Maher’s lease 

terms; and (c) violated 46 U.S.C. § 41106(2) 

by unreasonably refusing to deal with Maher 

regarding its request for parity with APM 

and its attempts to settle counterclaims from 

another case. The Commission granted partial summary judgment to the Port Authority 

on statute of limitations grounds. Maher 

petitioned the D.C. Circuit for review of this 

decision and petitioned the Commission for 

reconsideration. The D.C. Circuit dismissed 

the petition for lack of appellate jurisdiction, 
52 55th Annual Report

and the Commission rejected the petition for 

reconsideration. Maher then filed a petition 

for review of the summary judgment and 

reconsideration orders, which the D.C. Circuit 

again dismissed for lack of jurisdiction based 

on a Commission motion to dismiss.

As to the merits, after extensive discovery 

and motion practice, the ALJ denied Maher’s 

claims and counterclaims and dismissed them 

with prejudice on April 25, 2014. On December 17, 2014, the Commission affirmed the 

ALJ’s decision. Maher petitioned the D.C. Circuit for review of the Commission’s orders, 

which the Commission opposed. On March 

22, 2016, the court issued an opinion granting 

Maher’s petition and remanding the case to 

the Commission for additional explanation 

of its decision, although it did not vacate the 

Commission’s order or reverse its decision. 

On September 30, 2016, after the Commission 

ordered the parties to file supplemental briefs, 

they moved for approval of a settlement agreement and dismissal of this case and Docket 

No. 12-02. 

Adebisi A. Adenariwo v. BDP International, Zim Integrated Shipping, Ltd. 

and Its Agent (Lansal) et al. [Informal Docket Nos. 1920(I) and 1921(I)], 

United States Court of Appeals for the 

District of Columbia Circuit

The Claimant filed two claims on May 2, 

2011, alleging violations of Section 10(d)(1), 

of the Shipping Act, 46 U.S.C. § 41102(c) for 

problems arising from their shipment of concrete products equipment from Michigan to 

Lagos, Nigeria. After reviewing the evidence, 

the settlement officer dismissed Informal 

Docket No. 1920(I) on April 18, 2012, and on 

March 7, 2013, issued a decision in Informal 

Docket No. 1921(I) awarding the Claimant 

reparations in the amount of $18,308.94, limiting the award based on the principles of 

mitigation. The Commission affirmed on February 20, 2014. On March 21, 2014, Claimant 

filed a petition for review in the United States 

Court of Appeals for the District of Columbia Circuit. On December 15, 2015, the Court 

adopted the Commission’s argument that the 

Court lacked jurisdiction over the dispute 

in Informal Docket No. 1920(I) because the 

petition was not timely filed, but the Court 

vacated the Commission’s decision relating to 

mitigation of damages in Informal Docket No. 

1921(I) and remanded with instructions to the 

Commission to award damages as supported 

by the record without applying the principle 

of mitigation. The case is pending before the 

Commission.
55th Annual Report 53

Rulemakings

The Commission updated several of its 

rules this year to update its regulations and 

reflect statutory changes.

Attorney Fees, Docket No. 15-06

On March 1, 2016, the Commission issued 

a final rule amending the regulations governing the award of attorney fees in Shipping Act 

complaint proceedings, and its regulations 

related to Commissioner terms and vacancies. (81 FR 10508). The changes implement 

amendments made by the Howard Coble 

Coast Guard and Maritime Transportation 

Act of 2014.

Service Contract and NVOCC Service 

Arrangements, Docket No. 16-05

On February 29, 2016, the Commission 

sought comments on possible amendments 

to its rules governing Service Contracts and 

NVOCC Service Arrangements to update, 

modernize, and reduce the regulatory burden 

of the regulations. (81 FR 10198). The Commission issued a proposed rule on August 22, 

2016. (81 FR 56559).

Ocean Common Carrier and Marine 

Terminal Operator Agreements Subject to the Shipping Act of 1984, Docket 

No. 16-04

On February 29, 2016, the Commission 

sought comments on possible amendments 

to its rules governing agreements by or among 

ocean common carriers and/or marine terminal operators subject to the Shipping Act of 

1984, and possible modifications to its rules on 

the delegation of authority and redelegation 

of authority by the Director, Bureau of Trade 

Analysis. (81 FR 10188). The Commission 

issued a proposed rule on August 15, 2016. 

(81 FR 53986).

Update of Existing and Addition of 

New User Fees, Docket No. 16-06

On March 21, 2016, the Commission sought 

comment on amending its user fees. (81 FR 

15002). The Commission issued a proposed 

rule on May 27, 2016. (81 FR 33637). On 

August 29, 2016, the Commission issued a final 

rule amending its user fees. The Commission 

raised certain fees and lowered others. The 

Commission also added an additional fee and 

repealed several other fees. (81 FR 59141). 

Rules of Practice and Procedure; Presentation of Evidence in Commission 

Proceedings, Docket No. 16-08

On May 4, 2016, the Commission sought 

comment on a proposal to reorganize several 

subparts of its Rules of Practice and Procedure 

and revise its rules regarding presentation of 

evidence in Commission proceedings. (81 FR 

26517).

Optional Method of Filing Ocean 

Common Carrier and Marine Terminal Operator Agreements Subject to 

the Shipping Act of 1984, Docket 16-09

On April 27, 2016, the Commission amended 

its regulations relating to the method of filing 

Ocean Common Carrier and Marine Terminal 

Operator Agreements to provide for optional 

filing of these agreements through a new electronic filing system. (81 FR 24703).
54 55th Annual Report

Inflation Adjustment of Civil Monetary Penalties, Docket No. 16-13

The Commission issued an interim final rule 

to adjust the maximum amount of each statutory civil penalty subject to Federal Maritime 

Commission jurisdiction for inflation, pursuant to the Federal Civil Penalties Inflation 

Adjustment Act Improvements Act of 2015 

(Sec. 701 of Public Law 11-74). (81 FR 42552). 

The adjustments became effective on August 

1, 2016.
55th Annual Report 55

APPENDICES

A - FMC Organization Chart
56 55th Annual Report

B - FMC Senior Officials - Fy 2016

Chief of Staff Mary T. Hoang

Counsel to Chairman Cordero Rachit Choksi

Counsel to Commissioner Dye Robert M. Blair 

Counsel to Commissioner Lidinsky Jewel Jennings-Wright***

Counsel to Commissioner Khouri John A. Moran

Counsel to Commissioner Doyle David J. Tubman, Jr.; Patrick Parsons*

Counsel to Commissioner Maffei Zoraya B. De La Cruz

General Counsel Tyler J. Wood

Secretary (Assistant) Rachel E. Dickon**

Chief Administrative Law Judge Clay G. Guthridge

Director, Office of CADRS Rebecca A. Fenneman

Director, Office of EEO Howard F. Jimenez

Inspector General Jon Hatfield

Managing Director Vern W. Hill; Karen V. Gregory**

Deputy Managing Director Peter King**

Director, Bureau of Certification and Licensing Sandra L. Kusumoto

Director (Deputy), Bureau of Enforcement Brian L. Troiano**

Director, Bureau of Trade Analysis Florence A. Carr

*Assumed February 2016; **Assumed September 2016; ***Departed July 2016
55th Annual Report 57

C - Statement of Appropriations, Obligations, 

and Receipts

Appropriations

For necessary expenses of the Federal Maritime Commission, as authorized by §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, $25,660,000: Provided, 

That not to exceed $2,000 shall be available for official reception and representation expenses.

Public Law 114-113 $25,660,000

Total Budgetary Resources $25,660,000

Obligations and Unobligated Balance:

Net obligations for salaries and expenses 

for the fiscal year ended September 30, 2016

$25,574,275

Statement of Receipts:

Dosited with the General Fund of the Treasury for the Fiscal Year 

Ended with September 30, 2016

Publications and reproductions, fees and 

vessel certification, and freight forwarder 

applications

$221,552

Fines and penalties $3,485,000

Total general fund receipts $3,706,552
58 55th Annual Report

D - Civil Penalties Collected

British Association of Removers Lts. $80,000

Sparx Logistics USA Limited $80,000

Azap Motors Inc. $60,000

Wilhelmsen Ships Services, Inc. $35,000

Aromark Shipping LLC $32,500

Knopf International Inc. $24,000

N/J International Inc. $22,500

Orient Star Transport International Ltd. $135,000

Ba Shi Yuexin Logistics Develop. Co. Ltd. $100,000

Thornley & Pitt Inc. $65,000

Volkwagen Konsernlogistiks GmbH. & Co. $170,000

Hecny Shipping Limited $300,000

Walker International Transportation LLC $60,000

Razor Enterprise Inc. dba Razor Cargo Services $50,000

American Global Logistics LLC $350,000

Round the World Logistics (USA) Corp $80,000

Baron Worldwide LLC $21,000

Posey International, Inc. $22,000
55th Annual Report 59

CL USA Inc. $22,500

Carlo Shipping International, Inc. dba CSI Logistics $32,500

China International Freight Co. Ltd. $100,000

King Ocean Services Limited, Inc. $50,000

Wallenius Wilhelmsen Logistics AS and Eukor Car Carriers $1,500,000

Total: $3,392,000