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FEDERAL MARITIM

Fiscal Yea

TABLE OF 

LETTER OF TRANSMITTAL

MEMBERS OF THE COMMISSION

I THE COMMISSION 

History

Function

Organization

II THE YEAR IN REVIEW 

The Shipping Act of 1984 

Processing Agreements Unde

Developments in Major US 

Tariff Automation 

III SIGNIFICANT COMMISSION ACTIV

DURING THE YEAR

Office of the Secretary

Office of Administrative L

Office of the General Coun

Office of Policy Planning 

Affairs

Bureau of Agreements and T

Bureau of Tariffs

Bureau of Hearing Counsel

Bureau of Investigations

Administrative Activities 

APPENDICES 

A Organization Chart

B Commission Proceeding

C Agreement Filings and 

D Tariff Filings and St

E Civil Penalties Asses

Year 1984

F Field Investigations 

G Statement of Appropr

and Receipts for the 

September 30 1984

Qtnre of the Chairman

3Feberal fiiaritt

IllashinBA

To the US Senate and House of 

Pursuant to section 103 e2

of 1961 and section 208 of the 

amended I am pleased to submit 

the activities of the Federal M

1984 ending September 30 1984

S

A

C

MEMBERS OF TH

Alan Green Jr

Chairman

Appointed 1981

Term Expires 1986

R Oregon

Robert Setrakian

Commissioner

Appointed 1983

Term Expires 1987

D California

James V 

Commissio

Appointed 

Term Expires 

R Main

I

THE COMMIS

History

The Federal Maritime Commis

independent regulatory agency by 

effective August 12 1961 As succ

Board the Commission was charged w

regulatory provisions of the Shipp

laws of the United States were 

categories regulatory and 

responsibilities associated with p

efficient US Merchant Marine be

Administration now located w

Transportation The Federal Ma

responsibility over the regulation 

United States

Function

The Federal Maritime Commiss

administration of varying portion

statutes Chief among these are t

1916 the Intercoastal Shipping Ac

Marine Acts of 1920 and 1936 

represents a major change in th

shipping companies involved in the 

United States
The Commission sprincipal r

as follows

Oversight of certain ag

flag common carriers by w

in the US foreign comm

conference pooling jo

agreements

Receipt and review of 

regulation of rates by 

carriers by water engaged 

Guarding the rights of 

engaged in the foreign 

from restrictive or no

regulations of foreign go

of foreignflag carriers 

the commerce of the Unite

Maintaining the rights o

to transport cargoes in t

Regulation of rates cha

and practices of US 

domestic offshore trades 

Licensing of internationa
Issuance of passenger ve

financial responsibility 

to pay judgments for pe

repay fares for the no

cruise

Investigations of disc

classifications and pra

flag ocean common carri

freight forwarders oper

domestic offshore commerc

Rendering decisions issu

and regulations governing 

US foreign and domesti

operators freight forw

subject to shipping statu

One of the Commission sprim

the administration of agreements 

Shipping Act of 1984 Section 7 o

carriers exemption from US antitr

Sherman and Clayton Acts once 

Commission become effective Th

certain major agreements to ensure 

grant of antitrust immunity and 

would not result in unreasonab

services or unreasonably low levels 
Beyond the Commission ssecti

the activities of competing ocean 

United States the FMC is also c

the shipping public by ocean c

Shipping Act of 1984 prohibits 

undue discrimination or preferen

shippers or other parties engaged 

requires carriers and conferenc

practices commonly known as ta

that the applicable rates and char

actually charged for service rend

with the Commission can be cha

certain state controlled shipping 

authority to disapprove rates in 

US foreign commerce The FMC 

oceanborne commerce of the United 

Generally the Commission is 

and stability in the conduct of US 

the large percentage of US foreig

ocean liner shipping services or 

under the regulatory purview of th

role must be to promote efficie

foreign commerce commensurate wit

well as to protect the US shippin
Organization

The Federal Maritime Comm

Commissioners appointed by the Pres

the advice and consent of the Un

than three members of the Commi

political party The Preside

Commissioners to serve as Chairma

executive and administrative office

Six offices are directly res

Office of Administrative Law Ju

Counsel Office of the Secretary 

International Affairs Office of th

of Equal Employment Opportunity 

to the Director of Programs a

Commission sregulatory programs 

report to the Director of Admin

graphic representation of the Coms

In fiscal year 1984 the Fe

authorized a total of 240 fulltime 

a total appropriation of 19400

Commission spersonnel are located 

offices in New York Chicago San 

Orleans Miami and San Juan Puert
II

THE YEAR IH 

The Federal Maritime Coms

existence was dominated by a sin

1984 A significant proportion 

centered around working with 

successful enactment of this 

enactment the Commission ded

development of interim and final 

Act of 1984 The Shipping Act o

in this section the discussion of 

Commission is covered in part III 

on the activities of the Office of 

A major reason for the enactm

was to expedite the agreements p

under the Shipping Act of 1916 had 

between the time certain agreemen

were approved by the Commission 

were complex but many believed t

placed such a burden on the propon

agreements that parties opposed t

demand that the Commission hold an 

the agreement This legal pro

significant regulatory lag

This section contains a le

process established by the Sh
implementation of the new agreemen

Bureau of Agreements and Trade 

discussion is a review of developm

trades Under the new scheme tra

potential problems should replace 

of agreements

Finally fiscalyear 1984 w

major effort by the Commission le

to enhance the automation of the 

tariff automation project was begu

the fiscal year and it is expected 

major source of activity for the 

next several years

THE SHIPPING ACT OF 1984

The Shipping Act of 1984 PL 

1720 was signed into law by Pres

and became effective on June 18 

several years of legislative con

significant reform of the United 

the original Shipping Act was e

purposes of the Act are to 1 

regulatory process for the common 

the foreign commerce of the Un

government intervention and reg

efficient and economic transpo
commerce of the United States tha

harmony with and responsive 

practices and 3 encourage the d

sound and efficient USflag lin

national security needs Some of 

the Act are discussed below

Agreements Subject to the Act

The Act applies to agreeme

carriers to engage in seven enum

The only activities which are diffe

Shipping Act 1916 are the fixin

regulation of service contracts 

terminal operators are also include

Significantly however agreemen

common carriers and among freig

subject to the Commission sjurisd

Agreement Processing

Since 1916 Congress has perm

band together and act concerted

prosecution However agreements 

to be filed with the Commission a

could be implemented The burden 

of these agreements to justify 

criticized by some as a vague p

implementation of agreements was o

period of time particularly if pr
The Shipping Act of 1984 sup

with respect to the regulation o

common carriers and certain o

commerce of the United States 

changes with regard to 1 the 

within its scope 2 the mandato

agreements 3 the procedures 

reviewing agreements and 4 the 

immunity which it confers on 

significant change include new 

somewhat modified exemption autho

Under the 1984 Act agreeme

without Commission approval 45 

the agreement is rejected for f

requirements 2 the Commission se

the effects of the agreement o

injunction against the operati

Commission is also authorized to 

review period to not less than 

agreement sfiling is published in 

The broad public interest 

competitive impact of agreements 

by a new general standard This 

agreements which reduce competitio

costs are unreasonably incre

unreasonably decreased If the 

agreement will operate in violat
can go to district court and seek 

agreement Under such circumsta

squarely on the Commission and no 

court action

Independent Action

Under the 1916 Act conferenc

individual members to take indepe

member was dissatisfied with the 

to change it within the conferen

permitted independent action and so

The 1984 Act requires all con

provision stating that a conferenc

action on any rate or service item 

days notice to the conference 

independent action does not a

contracts The new law allows a 

or prohibit its members from enteri

Antitrust Immunity

The 1984 Act clarifies and e

immunity granted to agreements 

immunity applies to any agreeme

becomes effective It also appl

undertaken with a reasonable bas

pursuant to an effective or exemp

exemption granted from the Act s f

10
it antitrust immunity The new 

parties from suing for treble dam

the antitrust laws with respect to 

Intermodal Authority

The 1984 Act authorizes vess

into conference and other agree

rates and extends antitrust im

Under the 1916 Act the Fed

authorized a number of conferenc

rates between points in this co

Department of Justice had 

jurisdictional grounds but the m

The 1984 Act clarifies this situat

fixing of through rates with

conference members can agree

Tariffs

The 1984 Act retains the re

and conferences file with the 

their rates and charges Howeve

recycled metal scrap waste pap

excepted from this requirement 

rates in their tariffs which v

offered over a specified period o
Service Contracts

Service contracts are arran

commits to a minimum amount of ca

ocean common carrier or conferen

schedule and a defined service lev

confidentially with the Commission 

essential terms must be publish

essential terms must also be ma

similarly situated The essentia

and destination port ranges or geo

involved 3 the minimum volume 

duration 6 service commitments 

nonperformance if any

The variables which can be m

contracts are infinite They th

significant freedom to tailor 

suitable to their commercial need

Shippers Associations

The Shipping Act of 1984 rec

for the first time as enti

transportation They are defin

shippers which on a non profit b

to secure volume rates or enter in

expressly requires that carriers 

shippers associations It also 

can enter into service contracts 

12
Shippers associations have not 

under the 1984 Act

Loyalty Contracts

A loyalty contract or d

previously known is a contract 

or conference offers a lower rate 

shippers cargo They were 

antitrust immunity under the 

Commission The Commission had 

but one for use by conferences

The 1984 Act prohibits the 

in conformity with the antitrus

history indicates that contracts 

be acceptable but that concerte

conference is likely to violate t

Access to Cross Trades

Section 13b5 authorizes 

tariffs of foreignflag carriers 

when such carriers or their host 

USflag carriers in a foreignto

Section 13b5 is intended to 

Merchant Marine Act of 1920 w

authority to counter discrim

governments and foreignflag c

Section 13b5 reflects a C

13
impact of the UNCTAD Code of Co

particularly its cargo sharing fea

continued ability to lift cargo in 

applies

With the advent of more pro

efficient and effective intermodal 

and other extended service patter

will become an essential element o

Therefore section 1365 may bec

features of the new Act to USflag 

Controlled Carriers

The 1984 Act retains the same 

or controlled carriers which appli

Shipping Act of 1978 These in

procedural requirements the require

rates not become effective sooner 

filed and that such rates be just a

Prohibited Acts

Section 10 sets forth ce

prohibited by the Act These 

proscribed activities eq that c

rates that no one obtain transporta

rates or that carriers not disc

ports They also include some new 

contract not in conformity with the 

14
negotiate with a shippers ass

other concerted action which res

to deal engaging in conduct that 

of intermodal services and enga

designed to eliminate the part

particular trade

Complaints Investigation and Re

Any person may file a compl

Act except for section 6g and 

The Commission may on its own mo

agreement which its believes may b

Commission or a complainant may 

court against any activity though

If the complainant loses reaso

awarded to the respondent

For any complaint filed with

the cause of action the Commis

reparations for actual injury in

reasonable attorney sfees 

violation of certain prohibited a

as twice the amount of actual inju

Penalties

Violations of the Act reg

Commission orders can result in 

5000 for each violation except 

15
the Act If the violation was wi

the amount of civil penalty could 

violation Each day of a conti

offense In addition the Com

carrier stariff or its right to 

violations of certain provisions o

Ocean Freight Forwarders

No person may act as an o

licensed by the Commission Licens

who is qualified by experience and 

services and furnishes an accep

primary business is the sale of me

for its own account without a lice

has a direct or indirect benefici

not be compensated therefor

Data Collection and Studies

For a period of five years fo

the Commission must collect data on 

increases or decreases in the leve

frequency or type of common carri

strength of independent carriers 

and cost of proceedings before th

must consult with the Department o

Transportation DOT and Federal T

data collection effort and must pro

16
An Advisory Commission on Con

be established 51 years after en

time the Commission must submit 

Commission an analysis of the impa

FTC must submit their analyses 60 d

One year after the Advisory 

must provide Congress a comprehe

ocean shipping and must recommend 

prohibited remain open or beco

information on the fiveyear study 

in fiscal year 1984 to comply 

discussion of the section 18 study 

the Office of Policy Planning and I

PROCESSING AGREEMENTS UNDER THE NEW 

The Shipping Act of 1984 gove

carriers by water conferences of s

as defined therein operating in th

of the United States became effect

this new law procedures applic

agreements were radically change

Shipping Act 1916 and its applic

occasionally years would pass betwe

was filed and the final Commiss

burden of these delays the Com

reform to expedite the agreem

17
Nevertheless because of various 

complex agreements would take sev

considered for Commission actio

industry was being denied the 

arrangements with the immunity 

followed with Commission approval 

Under the Shipping Act of 1

by the Commission They are f

takes action to delay or prevent 

effective 45 days after the date 

The normal review period of 

staff requests additional inform

the authority to seek injunctive 

the basis of demonstrating th

competition to the extent of 

increase in rates or an unreason

burden of convincing the court th

or both of the above results 

legislative history of the Shipp

that Congress did not intend tha

action except in exceptional and 

initial effective date of the A

1984 a period of about 31 mon

Commission to seek an injunction

In order to prepare for 

processing procedures were esta

date The Bureau of Agreeme

restructured to meet the rigid s

18
agreements could proceed rapidly th

time it was also necessary to en

organization with the ability to 

important trades to prevent exces

result in an unreasonable increa

decrease in service

Under the new law when agreem

the Commission they quickly flow t

They are receipted numbered exam

with the administrative aspects o

notice of the agreement is prepared 

Register The law requires that s

Federal Register not later than sev

agreement is filed

The new statute gives the Com

any agreement which fails to confor

far the Commission has not rejected 

rule deficiencies Rather every e

filing parties to quickly correct 

basis This avoids imposing u

industry and obtains compliance in 

Under the new legislation 

agreement processing are complete 

Federal Register inviting public c

is published on a 10 or 15 day pu

upon the relative importance of the 

once a public protest against appro

19
an ex parte situation was created 

could not discuss the agreemen

involved parties without their op

record However under the new 

created because the Commission ca

becoming effective on its own 

injunction One of the primary b

staff ability to negotiate 

agreements on an informal basis 

issues without the necessity of 

hearing

The new statute does provi

Commission can shorten the othe

period between the time an agreem

date Specifically it is aut

period to as little as 14 days 

Register Additionally the sta

to extend the 45day review p

Commission believes that addition

order to obtain additional inform

responsibilities of agreement rev

under the new Act the Commiss

period in only four situations 

ments However 25 agreements we

basis Most of these were agreem

significant nature

2
The initial impact of the 

agreements process can be seen 

agreement activity immediately p

date of the Act In the app

period October 1 1983 to June 

file with the Commission pending 

fiscal year 192 were received d

of 300 Of these 18 were withd

determined not subject to the a

parties 226 were approved or con

and 5 were in the category of m

accounts for 299 agreements leav

end of the fiscal year This 

Management agreement which is the 

On June 18 1984 the new A

month period of the fiscal year 

the Commission Of these 4 were 

subject to the Act 3 were term

approved domestic agreements app

1916 and 98 were permitted to 

statute At the end of the fisca

were pending disposition by the C

The Bureau of Agreements an

some time developing and using w

automated basis Future plans 

personal computers to impro

capabilities

21
DEVELOPMENTS IN MAJOR DS FOREIGN 

Transatlantic Trade

During fiscal year 1984 t

Atlantic trade attempted to stem 

which they experienced during the 

November 1983 the North Atlantic 

implemented a series of general ra

recapture ground lost through th

rates since the beginning of 

conferences was strengthened by the 

authority amendments and the addi

carrier Trans Freight Lines

Subsequent to the passage of 

transatlantic trade was the first 

of the conference system In Aug

one eastbound and one westbound 

conferences in the North Atlantic 

South Atlantic trade These new c

October 12 1984 replacing a to

conferences

During fiscal year 1984 thre

the trade began implementing expan

of larger vessels and new servic

Container Line introduced the first 

trade Barber Blue Sea Line introd

22
in its round theworld service a

efficient vessels United States 

first of its new larger vessels U

operate an eastbound round thewo

infusion of new capacity came from 

using 16 vessels in east and westbou

Four of the conferences servin

and the US Atlantic were planning 

year 1984 Specifically those c

inbound portion of the trade expect 

group It is expected that mor

consolidation or merger which sho

efficiency and at the same time allo

economies

In the North AtlanticEurop

agreement between Star Shipping AS 

AB No 217 010603 was filed and be

Act In the South AtlanticGul

CAROL Lines Joint Service No 10168 

Act and the former Gulf Europe Exp

10266 was reconfigured into a s

agreement and extended under the 1

Europe trade the Johnson Scanstar 

extended under the 1916 Act the 

Service No 9901 was reconfigure

charterjoint service arrangement 

Act and a new joint service between 

No 10482 was approved under the 1

23
Transpacific Trade

Fiscal year 1984 was domin

between the eastbound and wes

strength of the US dollar a

import demand while American ex

demand As a result incoming 

capacity and outgoing vessels c

of unused cargo space The 

westbound trade also contribute

many carriers For example the 

certain areas of the Far East 

made available from incoming wes

Diminished cargoes combi

transpacific carriers prompted 

year old Pacific Westbound Con

cargo share had fallen sharply 

membership of ten included only 

total number of carriers operatin

Competitive pressures applied 

independent actions taken by PWC 

carriers characterized as a

Bureaucratic conference structur

understanding near the end of fi

November 1 1984

The immediate cause of this 

over reefer pricing levels but 

2
concluded that the PWC could no lo

membership Although the di

independent status for all opera

anticipated that an attempt would 

more flexible framework on whic

Further it is expected that the 

the trade an opportunity to conso

scope with that of other con

westbound trade

Entry into and exit from the 

to be fluid during fiscal year 198

upgraded services in response to 

while others experienced severe fin

bankruptcies partly as a result 

new factor that promises to in

capacity levels began to make it

Evergreen Line s Round theWorld 

Evergreen will have assigned twent

foot equivalent container units e

of these will cross the Pacif

Observers fear that the curren

exacerbated and that the survival 

may be at stake A second RWS w

year closed but it is reported t

States Lines will operate only in 

Another matter that had som

trades concerned Philippine gov

25
cargo sharing regime on the bila

States Pressure exercised by th

been a major factor in the allev

shippers have expressed widespread 

directed toward the preservation of 

Finally it should be noted th

ventures had been implemented or w

planning stages as the fiscal yea

factors encouraging such ventures 

opportunities presented by the Ship

This trade probably has had m

than any other since the 1984 Act 

conclusion of the 1916 Act the C

charterrationalization agreement b

Showa Line in the US West Coas

No 10500 A modification t

reservationdedication basis and 

Americanflag Common

In addition a

and joint service

under the 1984 Act

agreement between

Container Line No

of a fleet

Australasia

JapanKorea

of up

trade

trade

Carrier Cha

filed at the conclusion of the fisc

26

number of new 

agreements we

including a ne

Neptune Orien

213 010601 

to seventeen 

new joint ser

among Westwood 
Hoegh Miranda and Partrederiet Ho

and a new 9vessel space charterrat

217010614 between Seawinds and th

Africa

The African trade continues 

nationalflag carriers in Morocco 

Coast charter space westbound 

carrier services Although this 

was limited to charters between US

flag carriers the first arrange

carrier in the Ivory Coast trade N

fiscal year and was approved 

arrangements facilitate commercial 

by developing nations nationalfla

the substantial capital commitme

necessary in deploying their own n

time as they have acquired commerc

At this juncture it is anticipat

similar thirdflag space charte

will be filed particularly since t

vehicles whereby experienced thirdf

in the carriage of substantial am

similar agreements in the Camero

carriers Nos 10477 and 10480 wer

Act

27
South America

The South American trades we

year 1984

The ten revenue pooling sailin

in the USArgentine Brazil tra

engendered considerable controversy 

Acts in connection with the 

modifications which were filed to 

and extend their duration The

comment from both shipper and carr

Although these agreements raised 

under the two Acts the central pro

the cargo reservation policies of 

flag carriers operating in these tr

thirdflag operators themselves as 

prefer their services The agreem

to expire December 31 1983 and 

that a lapse of these agreements w

Commission authorized two shortterm 

sufficient time to assess the 

particularly in the light of 

standards which would be app

Significantly toneddown version

subsequently filed under the 1984 

new round of shipper and carrier o

Commission formally requesting 

section 6d of the 1984 Act in o

28
agreements competitive effects un

After careful analysis of the issue

the general controversy surroun

Commission determined not to take 

prevent the agreements effective

conditions affecting US foreign 

section 19 of the Merchant Marine 

TARIFF AUTOMATION

In September of 1984 a Task 

James Carey was formed to explore 

Tariff Filing and Information Sy

foreign tariffs were required by 

Commission the annual volume of 

tenfold It is projected that m

will be filed during fiscal year 

existing pages The Commission 

which summarized the results of 

carriers conferences and freig

demonstrated widespread interest 

for automated filing and retrieval 

On November 14 1983 the 

Inquiry pertaining to implement

filing Comments received fro

government indicated significan

automated tariff filing and info

29
responsive to the needs of both th

To facilitate electronic filing 

since June 1983 has accepted 

information electronically transm

terminal located within the Comms

The Task Force is now re

developing a pilot automated tariff 

defining the needs of industry 

objectives have been established fo

should be operated by the private 

control 2 it should be financi

longrun with the system being 

charged to users of the system 3 

enhance competition within the 

availability of pricing information 

supplant existing private sector 

services

30
OFFICE OF THE SECRETARY

III

SIGNIFICANT COMMISSION ACT

The Commission sstatutory 

carried out through various bu

agency Six offices are directly 

Office of Administrative Law J

Counsel Office of the Secretary 

International Affairs Office of t

of Equal Employment Opportunity 

to the Director of Programs 

Commission sregulatory programs 

management and administrative s

offices Appendix A indicates th

the close of fiscal year 1984

The Office of the Secretary 

regular weekly agenda of matters 

Commission and recording subse

Commission on these items rec

complaints involving violations 

other applicable laws issuing or

the Commission maintaining offic

formal proceedings receiving 

directed to Commission personnel 

31
the Freedom of Information Gove

Privacy Acts responding to in

Commission staff maritime in

authenticating instruments and d

issuing agency publications and 

proceedings before the Commission 

bound volumes of Commission decis

also participates in the developme

the length and complexity of for

evaluation of the efficiency of th

structure and implementation of 

shipping statutes

During fiscal year 1984 this 

of Volume 23 of the Commission sd

implementing the Freedom of Inform

in the Sunshine Acts revised 

legislative changes and revised p

small claims assumed control of 

administrative and management servi

development of the agencywide word 

Informal Dockets Activity

This Activity is responsible f

claims filed by shippers against co

in the foreign and domestic offs

States These claims must be pre

Shipping Act of 1984 or the Interc

32
which reparation of less than 1000

of claims received under this 

requests for freight adjustments a

by carriers During fiscal yea

Activity received 56 new cases an

disposing of 58 informal docket cla

Office of Informal Inquiries and C

This Office coordinates the 

system throughout the Agency 

complaints and information reque

nearly 20 more complaints and inq

year From this activity complain

through savings and refunds in fisc

The Office acted as liaison 

forwarders conference executives 

bureaus within the Agency ena

representatives and appropriate Co

During the latter part of the 

informing the maritime industry a

1984 During one month alone o

information about the legislation w

Office of Energy and Environmental 

This Office ensures Commissio

Environmental Policy Act of 1969 

Conservation Act of 1975 These 

33
complete analyses of the energy an

agreements and docketed proceeding

action is likely to have a si

conservation or the environment 

complete an analysis of the situ

prepare energy and environmenta

fiscal year 1984 the Office re

docketed proceedings Of these 

from any environmental analysis 

and analysis of the remaining 10 

significant impact It was not n

energy or environmental impact stat

Administrative Services Activity

This Activity was reestablish

Office of the Secretary after the 

was dissolved This Activity pro

resources and facilities support fo

offices It is responsible fo

property supply communications 

contracting procurement duplic

services safety and emergency e

and parking control

Although in existence for less 

year 1984 the Activity was res

Commission smicrographics service

with implementing Phase I of the 

34
plan The Activity is scheduled t

Reporting Services contract comple

Commission s ADP procurement 

propertyinventory communications 

of the Office

Management Analysis Activity

This Activity was also reestab

Secretary this fiscal year due to 

of Management Services This 

obtaining Office of Management and 

and recordkeeping requirements 

otherwise implementing the Paperwo

Activity also is responsible for 

internal management studies and 

effectiveness and economy in the m

and determines if desired program 

achieved The Activity acts as 

agencies with respect to Federal 

Federal Civilian Work Force Prod

Agenda of Federal Regulations the 

Assistance and the US Government 

In fiscal year 1984 the A

informationautomation requirements 

study of contracting practices und

printingphotocopying and data pro

controlsvulnerability assessment a

the agency stravel program and per

35
Final Decisions of the Commission

During fiscal year 1984 the 

in three formal proceedings and 

formal proceedings Seven forma

or dismissed without decision in

review Administrative Law Judge o

Twelve Administrative Law Judge 

proceedings became administrative

time for the Commission to determi

The Commission also con

applications and 58 informal do

carriers for less than 10000

In rulemaking proceedings th

rules and discontinued eight 

Certain of these rulemakings we

Shipping Act of 1984 while s

initiated this fiscal year to imp

will be finalized early in fiscal 

OFFICE OF ADMINISTRATIVE LAW JUDGE

Administrative Law Judges p

receipt of a complaint or instit

Commission sown motion

Administrative Law Judges hav

oaths and affirmations issue s

36
proof and receive relevant evidence 

be taken whenever the ends of just

regulate the course of the hearin

settlement or simplification of th

patties dispose of procedural requ

decisions or recommend decisions 

authorized by agency rule consist

Procedure Act

At the beginning of fiscal yea

pending before Administrative Law J

cases were added which included 

Administrative Law Judges for furth

held 26 prehearing conferences con

and issued 18 initial decisions in 

initial decisions in special docket 

Commission Action

The Commission adopted 10 form

docket decisions

Decisions of Administrative Law Ju

decided by the Commission

Docket No 83 48 Alaska Mariti

Port of Anacortes et al Twentyfo

thirtytwo respondents violated se

Shipping Act 1916 by filing ta

agents liable as principals for c

The respondent denied the allegatio

37
to enter settlement agreements whi

tariffs with which all parties a

the Commission the complainants w

the complaints and dismiss the pro

good example of a case in which t

issues in the early stages of the 

supervision resulted in a settlem

expense in discovery trial etc

Docket No 83 50 Jacksonvi

Amoco Transport Company and McGif

of Jacksonville The complaina

Jacksonville sordinance providin

anchored in storage over 58 hours 

in violation of section 17 of 

requires that every person subject 

and enforce just and reasonable re

to or connected with the rec

delivering of property Five s

subjected to the user fee Delta 

Marine Transportation Corporati

Transportation Co intervened as 

possibility that in the future th

the user fee Hearing Counsel als

It was found that the language 

imprecise that as to the five sp

furnishing terminal facilities a

person subject to the Act the co

five vessels the complaint was n

3
of terminal facilities by vessels 

or delivering of property but sho

amended or clarified by the City so 

apply to common carriers by water e

their business of receipt or de

complaint would be dismissed in its 

Docket No 847 Tariff Comp

Behalf of A A International a 

v The Kawasaki Kisen Kaisha Ltd 

involved an issue of tariff interp

favor of the carrier because of a f

complainant

Docket No 84 10 The Coca

Peruvian Amazon Line In anothe

tariff interpretation the questio

could receive the palletized rate 

then placed in boxes was answered i

Docket No 84 14 FilAmeric

Maersk Line Steamship Company T

application of a tariff rule in th

palletized cargo The complaina

complaint once but when late in th

sought to amend the complaint aga

the case ultimately was dismissed 

of limitation and in part because o

Judges also issued initial de

82 54 83 1 83 7 83 9 83 12 83 

31 83 39 83 47 Special Docket 

39
1061 1067 1070 1071 1075 1077 

1083 1084 1086 through 1114 11

1151 1153 1154 1155 1156 1157 

1164 1165 1166 1167 1169 thro

1190 1192 1193 1194 1196 1197 

1205 1208 1209 1210 1212 121

described under Decisions of the C

Pending Proceedings

At the close of fiscal year 

proceedings of which 3 were inv

Commission The remaining procee

filing of complaints or application

shippers conferences port autho

operators trade associations and 

OFFICE OF THE GENERAL COUNSEL

The Office of the General Co

legal issues and provides it with 

consideration The Office revie

Commission rules drafts proposed 

policy renders formal and inform

adjudicatory matters and prepares 

Commission ratification The Off

also responsible for defending and 

court This litigation work large

40
Commission upon petition of review 

Circuit Courts of Appeal This 

Commission or its employees befo

Commission sinterest may be affe

the Office is responsible for pre

to Congress on various maritime 

following is a brief summary of 

the last fiscal year

Adjudicatory Matters

Docket No 78 32 Pac

Equalization Rules and Practices 

Commission found that the Pa

equalization and absorption practi

affected the Port of Portland O

205 of the Merchant Marine Act of 

of the Shipping Act 1916 The ag

of the Merchant Marine Act of 192

Commission investigations of carrie

Commission also commented on the 

practices and the historical con

cargo under the statutes administe

Docket Nos 79 2 and 79 3 

Agreement No 10295 22 SR 

determined that Andino Chemica

Transligra SA were acting as co

United States Colombia trades in 

service to the shipping public 

41
responsibility for the cargo and p

its loading and navigation The C

carriers had implemented unapp

Mercante Grancolombiana in the C

agreements could not be approved 

Shipping Act 1916

Docket No 79 83 Investiga

the US North Atlantic Trades 

Commission terminated an investi

fixing on the ground that no use

served by continuing it Respon

shippers in settlement of civil an

cancelled or substantially modif

that allegedly had facilitated th

had implemented strict new proc

conference business which were 

compliance Finally the Comm

s

reviewed information regarding the 

was sufficient to meet any foreseea

Docket No 82 3 South Atlan

Agreement No 998423 Gulf 

Agreement No 10270 2 22 SR 

approved Agreement No 10270 2 in

authority for an unlimited ter

clarifying its geographic scope 

authority to be filed with the ne

42
Docket No 83 7 Atlanti

America Conference et al v E

SR 791 1984 The Atlan

America Conference filed a com

Maritima Del Estado had violated 

18b4of the Shipping Act 19

law judge served an Initial Decis

review the Commission adopted t

that there was no agreement betwe

which would have been subject 

section 15 In addition it fou

technical tariff filing violation 

Docket Nos 83 9 and 83 12 

Farrell Lines Inc 22 SR 10

that Farrell Lines Inc has p

authorized by the conference agr

and therefore had violated the 

18b and 3 of the Shippi

denied reparation to complain

however for failure to show a 

violation and its failure to car

service

Docket No 83 16 Terry 

Titanic Steamship Line Possible 

Public Law 89 777 22 SR 

instituted to determine whether r

passage on a passenger vessel f

first obtained a certificate o

43
required by section 3a of PL 

Commission held that the publicati

were market tests and not advert

statute The Commission hel

circumstances surrounding the pu

intent to book passage or collec

dismissed

Docket No 83 26 Pacifi

Agreement No 5200 22 SR 

instituted this proceeding to ex

Conference sindependent action p

rates The Commission found a 12

on intermodal rate offerings to 

interest within the meaning of se

1916 and ordered it to be deleted f

Docket No 83 45 Actions 

Unfavorable to Shipping In the 

Philippines Trade 22 SR 1143 

instituted in response to certai

shipping conditions in the Unit

Following the withdrawal of the 

implementing the waiver program th

proceeding without prejudice to 

should there be future indications 

this trade

Docket No 83 53 US At

Zealand Conference Agreement No 

44
Intermodal Authority 22 SR 

approved an application for 

condition that no advance noti

intermodal offerings not covered 

a provision in the agreement 

authorized collective arrangement

Docket No 842 Amendment 

Common Carriers by Water in the D

United States 22 SR 1195 

instituted in response to a peti

Inc to eliminate the 60 day adv

rateofreturn regulations applic

by common carriers serving the 

Virgin Islands domestic offsh

published Sea Land s request as 

the benefit of comments by affecte

and legality of the suggestions 

desirability of the deregulatio

concluded that it could not ad

comply with the requirements of t

amended by Congress in 1978

Litigation

National Association of 

American Mail Line Ltd et a

618 1983 The United States 

Circuit affirmed the dismissal of 

4
the antitrust laws Plaintiffs had 

shipping lines rates on wastepape

unjustly discriminatory in violatio

and that the defendants were theref

under the antitrust laws even 

wastepaper rates pursuant to a C

agreement Because the theory of la

threatened the viability of the 

section 15 of the Shipping Act 19

shipping lines from the antitrust 

amicus curiae brief with the Co

complaint The United States Supre

the plaintiffs petition for certio

California Cartage Company In

No 83 7102 721 F2d 1199 1983 

the Commission sdetermination in 

California Cartage Company et 

Association and held that operato

facilities had standing under the M

1980 to challenge the reasonableness 

onpier competitors to fund fr

employees The United States Suprem

Dart Containerline Co Ltd 

8212403 722 F2d 750 22 SR 

Appeals affirmed the Commission s

amendment which substituted a new 

The Court initially rejected D

s 

Commission did not have jurisd

46
amendment It then concluded tha

requisite authority to impose 

arrangement and that the limitatio

substantial evidence

Insurance Company of North Am

United States Lines and Transmoda

2nd Cir The Commission appeared 

decision of the US District Cou

New York holding the S AMERICAN 

vessel liable in rem for damage 

lading The NVOCC bill of lading 

to Yemen US Lines carried 

Rotterdam where it was transship

carrier and was discovered to be 

The District Court held the US 

the grounds that the vessel had 

lading to Yemen by sailing with th

of admiralty cases The Court of 

application of the admiralty co

situation involving common car

inconsistent with the Shipping Ac

regulated common carrier

Legislative Developments

The passage of the Shipping 

focus of legislative activity du

agenda of the second session of t

legislation of Commission interes

47
On May 23 1984 the Commiss

s

Bourgoin testified before the Ho

Marine on HR 1511 the socalled 

1511 addressed the issue of diver

through ports in countries borderi

Merchant Marine Committee reporte

measure was debated in the House a

vote A companion measure in 

considered by the Senate Commerce C

On October 30 1984 the Pre

law Section 3 of PL 98 595 am

and the Shipping Act of 1984 The 

of 1984 were intended to correct c

clarify provisions of the new ship

to the Shipping Act 1916 remove

freight forwarders operating in the 

States from the ambit of that Act 

to the Shipping Act of 1984 As a 

98 595 foreign freight forwarders 

Commission approval and antitru

activities

Rulemakings to Implement the 1984 A

Following enactment of the A

Commission was faced with the task 

that the broad guidelines set o

workable in practice During th

48
overriding concern was to establis

regulatory system which would resu

intervention in the day today ope

industry The Commission took the 

Act to completely reorganize its 

contained in Title 46 of the Code o

The Commission snew regulatio

freight forwarders service co

tariffs loyalty contracts a

agreements and USflag access 

would have been impossible to ado

pursuant to normal Administrativ

procedures prior to the effective d

issued interim rules pursuant to se

able to take effect immediately T

as proposed rules and the Commissio

them One hundred eightyseven co

segments of the ocean transportation 

Taking into account these 

ultimately adopted final rules in 

proceedings all of which will b

December 15 1984

The following is a review of 

these final rules

Service Contracts

The final rule requires that 

and statement of its essential term

49
the Commission Within 15 da

Commission can return a contract 

which does not conform to its r

have 15 days to refile the docume

The essential terms may not 

the contract except to the e

provisions for deviations set fo

service contracts may be termina

parties at any time If they 

carried must be rerated under th

alternative procedure has been sp

Though carriers and confer

shipment records for five years 

resident agent to do so

When the Commission initiall

in this area it treated serv

contracts separately with thei

Emergency comments convinced the 

and as a result the final rule 

but a type of service contract 

approach is that non vessel o

precluded from offering service 

they can enter into them as shipp

TimeVolume Rates

The final rule requires t

offering is accepted by one ship

50
the carrier s or conference sta

without amendment A shipper indic

rate by giving notice to the carrie

Notice may be accomplished by a

carrier Records supporting timev

retained for a least 5 years

Loyalty Contracts

The Commission initially pub

prohibited the use of any exis

September 18 1984 unless it was 

Letter BRL issued by the Depar

Justice did not intend to prosecut

under the antitrust laws At the 

effective there were 34 loyalty 

approved by the Commission T

conferences of carriers All were 

18 1984

The interim rule also propose

applicable to new loyalty contra

became effective However upo

decided to modify this procedure 

requirement in the final rule 

permissive with BRL s creating a 

the Act

This amended procedure leaves 

the merits of individual loyalty 

basis upon complaint or its own m

51
Shippers Associations

On May 23 1984 the Commi

Federal Register stating that it 

issue any rules concerning th

shippers associations under the 

Commission noted that Congress i

which arise from the formation 

falling within the jurisdiction 

Commission did state however th

associations become involved in 

to the Act any matters arising 

an ad hoc basis

Tariffs

The basic requirement that 

States foreign commerce file the

with the Commission has remained 

1984 Act However several impo

in the tariff filing obligations 

in the final rule The regulat

non vessel operating common ca

foreign commerce are subject to th

therefore required to file tarif

sheets for updating tariff chang

response to many comments urging 

carriers have been accorded th

52
commodities otherwise exempted from 

the 1984 Act

The terminology and filing 

intermodal tariffs have been 

streamlined These changes not only 

1984 Act which ended the requireme

divisions be separately stated but 

efforts to reduce the advance not

initial intermodal rate offerings 

permitted to file multiple tariffs 

cross referencing to allow flexib

porttoport intermodal and specia

tariffs Similarly more flexibility 

tariff cargo origin and destination 

use eq of zip code designations

However in light of concerns 

potential rate cutting by stateown

determined that controlled carriers 

existing statutory notice provisions 

the context of conference rate a

carrier was a member of the confere

a conference can continue to file 

carrier open rates or independent a

days notice

53
Agreements

The agreements rules are i

which ensure an orderly and 

agreements in accordance with th

in the Act Format and organiza

have been established to facil

agreements under the Act These 

affect the substance of an agreem

the freedom to develop innovativ

addition it is the policy of 

conference agreements are permitt

provisions in accordance with the 

the Act The rules also require 

accompany the filing of certain 

only that information which is 

review of an agreement under th

The rules also establish certa

requirements to enable the Com

regulatory responsibilities T

avoiding the private and public c

exempting certain maritime agree

Finally the rules implement the 

agreements must be complete and d

An Information Form is in

agreements rules The purpose 

economic information concerning 

the particular trade involved wh

5
the Commission sreview of an a

standard Information concerning 

market share of the parties marke

and foreign government involvement 

required depending on the nature of 

if they wish enumerate the benefit

are also required to identify cer

identify certain contact persons 

completeness of the information prov

Section 13b5

The final rules pertaining to 

factors which would indicate the e

unduly impair access of a USfla

They also delineate the contents of 

section 13b5

A proceeding under section 1b5 

Commission either following a comp

to compete in a

foreigntofor

Commission sown motion In some s

more effectively resolved by diplom

Commission may seek the assistance o

The actual proceeding which 

situations has been left flexible so 

quickly to resolve petitions After 

an initial response period the Co

decision or order further hearings 

various sanctions which the Comm

55
Commission does impose sanctio

transmitted to the President who 

it for reasons of national defense 

OFFICE OF POLICY PLANNING AND INTE

The Office of Policy Plannin

responsible for a wide range of in

strategic planning policy briefi

affairs projects and informati

Commission in its statutory miss

the Office ensures that the C

developments and can anticipate 

liner shipping and the maritime t

Office include Monitoring the a

laws decrees and cargo preferen

shipping in the foreign trades 

regarding US maritime regulato

government togovernment and 

international shipping policy for

world economic trends and anal

operational and structural change

may influence the environment of 

The Office carries on economic 

studies and develops trade infor

to meet its regulatory respo

provides expert economic testimo

56
administrative proceedings New

include responsibility for deve

Commission s data resources and 

preparation and other public a

representing the Commission at pu

forums

Policy Planning Issues

The following are major pol

Office of Policy Planning and Int

involved during the fiscal year 

Regulation Inquiry expected to b

involvement in these issues will 

future

Shipping Act of 1984

Several provisions in the 

particular relevance to the Cos 

carried out by the Office of Po

Affairs

Section 6 sets forth the proc

all proposed and existing agreeme

proposed agreements be approved w

the Commission or 30 days afte

Register whichever is later 

short notice but the notice perio

after the notice of the filing of 

57
the Federal Register Su

substantially anticompetitive ag

time after the filing or effectiv

Commission finds that an agreemen

competition to result in an unrea

unreasonable reduction in service 

in district court However th

Commission and third parties canno

Section 13b5 empowers 

potentially unfair actions by a 

that unduly impair access of a 

trade between foreign ports and to 

and including tariff suspension 

Commission action under sectio

national defense or US foreign p

Section 18 requires that 

following enactment of the Act th

impact of this legislation on th

industry A comprehensive analys

progress to date is included at 

Office

Regulation of Ports and Marine Te

The Commission issued its N

Review Regulations of Ports an

Docket 83 38 in compliance w

Act s requirement to review Comm

58
The Notice reflects the concern 

industry be updated to keep pa

economic and technological envir

operates The Notice also addr

antitrust immunity for the port in

inquiry presided over by Commiss

comments from the port industry 

interested parties The resu

necessitate certain amendments to 

for Marine Terminal Operations iss

Act of 1984 Section 4 of the A

marine terminal operators and amo

operators and one or more ocean co

or regulate rates or other condit

exclusive preferential or cooper

Tariff Automation

Section 8 of the Shipping Ac

carrier in the US foreign comm

carriers to file and maintain tar

for bulk cargo forest products 

paper and paper waste The tar

charges classifications rules an

and ports on the route and on any 

that has been established At the 

approximately 4500 tariffs were o

and replacement tariff pages are 

59
600 0 annually and this number is 

massive and increasing volume of t

stepped up its planning efforts fo

facilitate the filing retrieval 

tariffs The Office of Policy 

Affairs in its study Tariff Au

Views concluded that there was 

automation in the shipping ind

direction of Vice Chairman Jam

conducting a study to determine th

system The Office will remain ac

process to implement an automated 

to expedite the flow of tariff info

International Affairs

In our increasingly interdepen

nation can affect the vital inte

even a group of trading partne

Commission must be cognizant of 

events and remain abreast of techn

dramatically reshape the struct

industry Foreign governments 

implementing all sorts of cargo sh

decrees and by becoming increas

decisions and regulation of the 

conferences operating in their line

60
The laws and decrees of fore

appearance of legitimacy with the 

Code of Conduct for Liner Confe

cargo preference schemes often re

instances specific commodities 

lines and the carriers of the 

Usually such schemes provide for 

under a system of waivers The

limit the options of shippers to 

lowest rates and the best serv

statutory authority under sectio

of 1920 to protect the interests 

US foreign trades Such autho

on a number of occasions to res

Commission These section 19 cas

The cargo preference regime

serve to bar the entry or restr

carriers in the cross trades A 

Act of 1984 empowers the Com

sanctions against the carriers 

against USflag carriers in 

Specifically under section 1b5 

authority to investigate potentia

or a foreign government that und

flag carrier in the ocean trade b

appropriate action up to and inc

legislative provision will 

Commission srole in its effort

61
efficient transportation system 

cargoes at competitive rates in th

During the year Commiss

technical advisors to the Intera

This government policy group 

representatives from the Departm

Commerce and Justice and the US 

designed to formulate and coordin

Commission has also been repres

technical capacity in US discuss

government officials

The CSG members meet

in the Con

to discuss a

facing the international shipping 

force of the UNCTAD Liner Code 

preference regimes the CSG and 

dialogue about approaches desi

competitive access to the world s

has also been represented by the 

policy discussions between US an

from Ecuador Japan and Malaysia d

was actively involved in a num

international affairs during fisca

are also expected to continue into 

The principal areas of concentratio

62 
Restrictive Cargo Sharing Decrees 

Foreign Governments Section 19 A

The trend towards cargo pref

and maintain nationalflag fleets 

during the past decade In large 

the stimulus of the UNCTAD Code

sharing which entered into forc

States can expect continued press

in the developing world to con

maritime agreements that reserve 

liner trades for the nationalfla

governments have enacted laws 

preference legislation or impleme

on oceanborne cargoes which discri

flag carriers in the US liner t

in certain instances served to re

obtain the best available service 

thereby adversely affecting the US 

Complaints about such discriminato

Commission actions designed to re

shipping in the US liner trad

Merchant Marine Act 1920 the C

authority to retaliate against 

foreign carriers and governments 

of foreign nations may also serve 

bar the presence of USflag 

foreign ports Under its new 

13b5the Commission can now 

63
enter the cross trades While 

tested it represents a significan

powers to safeguard US foreign t

a Section 19 Activities During 

The Commission has employed 

several instances during fisca

complaints about discriminatory a

governments in the US liner tra

trades with the Philippines Ve

Ecuador and Guatemala

The Philippine Maritime Ind

instructed in Executive Order 769 

all Philippine export and import 

reserved as government sponsored c

1466 be reserved for the n

Philippines and its bilateral 

equally MARINA issued Memorandum 

implement this cargo sharing schem

trades A great number of compla

carriers about the Philippine goves

ensued and resulted in a section 1

in Docket No 83 45 Subsequently 

the Commission discontinued Docke

doing so however the Commission 

the Philippine cargo preference la

PD 1466 to protect the interes

this trade The Commission also 

64
Delta Steamship Lines Inc and Co

Inc in 1982 and found in Dock

carriers were generally adversely 

government scargo reservation law 

imposing remedial sanctions in resp

section 19 However the proceedin

1983 pending the outcome of diplo

this issue These negotiations 

associate carrier status for the tw

on an interim basis pending the co

maritime agreement between 

ConcordeNopal later filed a co

alleging that Venezuelan governme

import liner cargoes subject to 

decrees and effectively precluded 

lines in the trade Following co

and subsequent to further diplomat

also granted associate status in 

government on a provisional ba

maritime agreement between the US 

30 1983 the Commission discontin

under Docket 82 58 following Conco

on its petition be suspended

In three other undocketed 

considered section 19 actions d

petition was filed by the US A

Caribbean Conference on February 

65
19 alleging that the Port Autho

established a docking system at Po

of the West Indies Shipping Cor

priority berthing The petition 

this created special conditions 

US foreign trade and resulted 

USflag vessels at Port of Spain 

petition by the US Atlantic an

Conference the Commission issued 

discontinuing any further proceed

was filed by Coordinated Caribb

December 12 1983 pursuant to sec

Commission issue rules to reme

shipping in the USEcuador trad

the Government of Ecuador had act

CCT the right to call at the Port 

that this action discriminated 

carriers Following considerati

Commission and diplomatic effort

CCT withdrew its petition on Ap

thereafter discontinued its pro

petition filed by the Guatemala 

Agreement on July 12 1984 also 

for an investigation of the tradin

Trailers CAT Line The Commis

August 15 1984

66
As the fiscal year came to a 

proceedings were being considered 

84 33 the Commission on its own 

pursuant to section 19 to inv

unfavorable to shipping exist in t

and Brazil In a separate but re

34 the Commission will consider 

Lines a thirdflag carrier 

that conditions unfavorable to 

USArgentine trades

b Cargo Promotion Reporting Prog

The Commission embarked on a 

program during the fiscal year wh

with information about the actions 

may result in complaints and pe

shippers under section 19 of the 

section 13b5 of the Shipping 

contain substantive information 

preference laws and decrees implem

access to cargoes indirect trade 

available in the event of discrimin

foreign carriers in the nation s

documenting the cargo promotion 

Venezuela Indonesia Japan and Ec

67
The UNCTAD Code of Conduct for Lin

The UNCTAD Code of Conduct 

into force on October 6 1983 As 

countries accounting for 286 

tonnage had become contracting 

fundamental objectives and basic 

the underlying desire that it se

regulatory instrument that takes 

and problems of the developing co

Code are to ensure the right of 

in the trade to permit them to ca

nation sforeign trade to balanc

shipowners and to facilitate the 

trades The major provisions 

relationship between member c

particular the rights of admissio

conferences serving their nation s

rules for the establishment of 

sharing arrangements in confer

conference activities as self po

relationship between shippers 

establishing principles for the 

well as requiring conferences to h

or their representative organizat

rates loyalty contracts and the 

Code also provides rules to g

promotional freight rates surch

factors

68
The US remains one of the fe

opposes the Code and will not rati

expected to eventually affect much 

for the US trades and the trad

countries where its provisions will 

made by these signatory nations in 

Nevertheless given its impleme

continue to monitor the Code and h

evaluating its potential for affe

trades governed by the Code and it

liner trades

As the UNCTAD Code gains w

trading nations open competition 

greatly reduced and access to the 

restricted The Commission how

statutory authority to ensure that 

open and that the interests of its 

foreign trades are also protecte

Commission will be called upon w

future to assert its regulatory 

interests in the foreign ocean

Interagency Maritime Policy Group 

discussions seeks to formulate 

policy measures to ensure that the 

Code remain open and competitive to 

69
USConsultative Shipping Group C

The US continued its disc

Shipping Group CSG A number 

policy issues of vital importance 

were held during the past year T

composed of Western Nations excep

In their discussions about meas

maximum degree of freedom of access 

CSG countries have focused 

competitive access for US and C

respective trades with developing 

the UNCTAD Code The US is 

carriers may be barred from or li

trades between the CSG countrie

nations due to the restrictive 

country governments or because o

certain conference lines The CS

are concerned that the US which 

will enter into bilateral agreeme

and thereby restrict the access of 

with these nations

During the fiscal year 

participated in the discussions b

During these meetings and in 

sessions of the US Interage

Commission representatives provided 

on the authority of the FMC 

discussion

70
Bilateral Negotiations

The liner shipping policies 

developing countries have clashed on 

past few years and resulted in incr

government togovernment bilateral 

During the year Commission staff 

advisors in the USMalaysian d

maritime agreement between the two 

Commission was represented at the US

in April and again in Washingto

purpose of these meetings was to di

Japanese road restrictions on 

containers the movement of US 

Japanese flag carriers Japanese 

restrictions on foreign liner o

discussion in the USJapanese 

decision to ratify the UNCTAD Code 

Shipping Act of 1984

The Commission sparticipation 

probably increase in the future as t

hold and as more and more deve

unilaterally impose and enforce carg

liner trades

Foreign Maritime Laws and Regulation

The Commission has continued 

reference files on foreign maritim

71
and regulatory structures Con

and its foreign government count

more prevalent as carriers and 

in a more complex regulatory en

developing countries unilaterally 

and trade practices in favor of th

By augmenting and updating its 

about counterpart agencies abro

readily respond to regulatory prob

our trading partners The Comm

the progress of the EEC s Pro

Transport and the maritime regul

developing countries

Foreign Visitors at the FMC

The Commission receives a n

year concerned with its regulat

Many of these visitors are intere

Commission sunderlying regulatory 

of the Shipping Acts or seek 

itself and its organizational 

The Office of Policy Planning 

frequently serves as a host for 

of the Commission and coordina

briefings or meetings with approp

to their inquiries and immediate 

72
Information Resources

The information resources prog

component of the Office of Polic

Affairs in July 1984 to provid

coordinate the management informat

With recent innovations in microco

of decentralizing data processing 

operating divisions was adopted 

Commission potential size of data 

at the Commission all contri

decentralize A comprehensive 

telecommunications and training w

end of the fiscal year The obj

equipment and data base respons

need information the most the 

include improved accuracy and f

offering longrun savings to the C

A major use of the microcomp

plan will be to support the se

effects of recently enacted legisla

services freight movements 

undertaken to protect US interes

practices and undue government in

Other automated systems planne

information regarding service con

agreements

Office automation efforts wer

installation of an office automatio

73
telecommunications and some infor

was installed at the Commission and 

and San Francisco field offices 

capability to electronically tran

offices

Future Plans and Proposed Activitie

For the coming year the Office 

to collect and analyze data requ

mandated by the Shipping Act of 

freight rate indexes for the ma

These indexes will be computerized 

of the study period Data base

electronically evaluate service p

and the extent of nonconference co

effort additional resources will 

computers and external data bases

In the area of international 

the laws decrees and regulations 

be compiled and added to the ex

participation in the USCSG 

discussions is also contemplated 

contracting parties to the UNCTAD 

more surveillance over development

anticipated that there will be 

section 19 of the Merchant Mari

13b5of the Shipping Act of 198

74
A major portion of the Off

s

years will involve the prepar

required by section 18 This stud

following section

Section 18 The Mandate for a Fiv

of the Effects of the Shipping Ac

and FMC Progress in Preparing this 

Section 18 of the Shipping A

for a period of five years followi

analyze information concerning t

international ocean shipping ind

the information the FMC collect

increases or decreases in the le

the frequency or type of common 

specific ports or geographic regio

of independent carriers in variou

time frequency and cost of 

proceedings before the Commission

Section 18b of the Act a

consult with the Department of J

Transportation DOT and the F

annually concerning data collec

shall at all times have access t

section to enable them to pro

collection

Within six months after exp

of data collection the Commissio

75
with an analysis of the impact of 

Advisory Commission on Conferences 

Commission and to the DOJ DOT an

will be established by Congress 

aforementioned agencies will also 

the impact of the Act 60 days afte

The Act further specifies 

following three topics should be a

a the advisability of adop

on volume and mass of shipmen

b the need for antitrust 

terminals and

c the continuing need for 

tariffs be filed and enforced 

The Advisory Commission is 

comprehensive study of and makin

conferences in ocean shipping 

address whether the Nation would 

conferences or by closed or ope

Commission shall within one year 

its recommendations to Congress

From the FMC s perspective t

three major areas of responsibilit

of data the second is ongoing con

FTC concerning data collection an

the data in order to determine the 

ocean transportation industry

76
One interpretation of the se

is that the Congress is concern

information that will enable it t

ocean transportation industry was 

1984 From an economic persp

industry should generally include 

levels in that industry In this 

viewed as being concerned with 

shipping industry and section 

changing output levels ie 

examination should include an a

level and type of service offered 

concerned with the impact of th

shipping As such in referenc

independents is interpreted to 

liner operators who are not mem

trades while the strength of 

in a number of ways for example 

transported or the number and c

independents

In addition the FMC will c

to address the three topics spec

Act

Thus the FMC is not confin

information alone but will att

believes relevant to an assessme

the industry For example alth

77
were not specifically mentioned in 

felt that this information is very 

the impact of the Act on the indu

the reasonableness of changes in the 

be much more valid when made in lig

in the level of costs

FMC Progress to Date

In February 1984 when it becam

likely become part of the Shipping 

a preliminary operational plan 

milestones that the agency would ho

of the fiscal year

The following six mileston

operational plan were met in fisca

Establish an Interagency 

the DOJ DOT FMC and FT

Make an initial assessmen

collection mandate 

problems

Brief the industry on t

mandate and approaches to 

Gather information on pot

for the project ie No

of Private Commercial Sou

Research the usefulness 

cost of known data bas

Interagency Group by data 

Begin a pilot data collec

78
1 The Establishment of an Intera

On May 22 1984 the Chairman 

the DOJ DOT and FTC to appo

respective agency to coordinate 

liaison to the FMC during the da

in section 18 The FMC held it

with the section 18 Interagency G

meeting the FMC distributed a len

and problems associated with the 

was to give the other agencies t

magnitude and complexity of data 

provide them with a vehicle for ex

scope of the data collection effo

Although the legislation s

consult annually concerning data 

interagency consultative meetings 

A wide range of topics was d

problems of certain data source

Congress specifically wanted under 

2 An Initial Assessment of the 

The FMC s initial assessment 

focused on sections 18a1 2 

examined conceptual issues and 

collection pursuant to each sec

information requirements require

provided An example of the ty

79
reference to section 18aand 

tariff rate index which would cap

volume rates currency adjustment 

rates independent action rates i

by conference and non conference op

3 Section 18 Industry Briefings

On July 31 1984 the Chairman 

representatives carrier representa

and invited them to a briefing by 

Chairman stated that although sec

require consultation or discussio

industry I feel it is extremely 

and briefed on the Commission seffo

The FMC held two identical b

Their purpose was to make the indus

the section 18 mandate and inform 

collection plans The briefings c

overview of the section 18 ma

conceptual issuesproblems involved 

construction of a rate index and th

progress to date under section 18 

Interagency Group were also present 

4 Notice to Determine Availabilit

Sources

In an effort to determine p

expertise which might be of value 

80
FMC on August 22 requested the Comm

a Notice to Determine the Avail

Sources In the Notice the FMC ex

and sought the qualifications of 

can provide the agency assistance 

received over two dozen responses t

5 Investigation of Known Data Ba

As part of the FMC s effort to 

informed as possible the FMC spo

major data bases The scope 

reliability of each data base was 

focused on explaining the difficu

statistical information on the ocea

6 Begin Pilot Data Collection Ef

In February of 1984 the F

sources it believed would be of pa

18 mandate

On March 12 the Commission en

Bureau of the Census to provide 

export liner operator cargo moveme

section 18 needs The FMC ente

March 6 1984 with the Journal o

Service to procure additional carg

individual shipper basis

81
The FMC has commenced a pilo

North AtlanticUK trades I

indices are being constructed 

sampling of the tariff informatio

second is a sampling of the rat

same trade Information on ser

also being gathered as part of the 

BUREAU OF AGREEMENTS AND TRADE MO

Surveillance

Under the present statutory 

responsible for maintaining ad

activities of parties to filed a

its jurisdiction in order to ensu

Shipping Act 1916 the Shippin

rules The Office of Trade Mon

charged with the responsibility f

Appendix C indicates the various 

the Commission

Under the 1984 Shipping Act 

agreement is subject to rejection 

of section 6g of the Act the a

take effect with the Com

surveillance over the concerted a

this statutory need the Commis

surveillance activities to ensure 

82
monitoring area We must be alert 

make the necessary determination 

meeting statutory and regulatory 

become effective with a substantial 

monitoring will be increased 

effective surveillance will requi

and analysis regarding competitive 

trades

To provide the Commission wit

for surveillance purposes the con

file with the Commission on a qu

documents related to those subjec

needs Minute requirements are b

entities as Joint Service Conso

Agreements

During the fiscal year the O

completed two trade profiles invo

United States and the Far East 

profiles include data on all line

subject trades including vessels 

frequency of service and trade rout

included on the conferences that o

membership in conferences by trade 

NVOCC operators in the trad

agreements import and export tonn

proceedings in these trades As 

becomes available it will also 

profiles

83
During the fiscal year the 

and projects concerning activitie

agreements

the scope

monitoring

and to activities of 

of a filed agreeme

of trade conditions in 

ascertain any unfavorable change 

the application of section 15 

Shipping Act of 1984 to certai

Steamship Lines as agent for N

2 the Park Lines Joint Venture 

Services 4 Westwood Transpaci

6 Hoegh Lines Joint Service a

Service Agreements overlapping 

minibridge movements involving S

Freight Lines the offering of 

Shipping without specific aut

Agreement No 9955 1 as well as 

STAR EAGLE without a filed agree

agreements by Maher Terminals Inc 

trade conditions which prompted 

membership in the Pacific Straits 

A particular aspect of adeq

of Trade Monitoring is the caref

that the regulated entities autho

in accordance with the applicabl

reports include the minutes of m

complaints reports and Ad Hoc re

Commission order

84
For the first two quarters o

1375 minutes of meetings were file

by parties to Conference and Rate A

the Commission informed of the 

approved agreements and aid in th

possible statutory violations 

shippers requests and complaints 

required by rule and indicate the 

Rate Agreements except twoparty 

effective procedures to fairly an

requests and complaints usually 

Appendix C includes a statistical 

with the Commission in FY 1984

During the fiscal year a p

comments was prepared The rul

s 

Commission spolicy regarding ce

where one party to the agreement p

offshore commerce of the United 

provides service in the foreign com

Types of Agreements

a Conference and Ratemakinq Agre

Conference and ratemaking 

collective discussion agreement 

freight rates and practices by gro

agreements are limited to a geogra

the basic distinction between con

being that a conference agreem

85
institution exercising a dominant 

trade whereas a rate agreement 

lesser influence on rates

During fiscal year 1984 

processing of 133 conference and r

such agreements One hundred and 

the Shipping Act 1916 and 29 

Shipping Act of 1984

Because of the widespread int

services by ocean common carr

standards during the period 18 co

fix intermodal through rates bo

abroad Almost every conference 

Commission now has some degree of 

At the close of the fiscal ye

agreements were in substantial 

provisions of the 1984 Act and the 

b Pooling and Equal Access Agre

Pooling agreements are c

carriers in given trades which 

apportionment of cargo andor rev

often set forth sailing requireme

to overall service efficiency E

formalize nationalflag carrier 

controlled by the governments of r

result of cargo preference la

restrictions

86 
At the conclusion of fiscal 

pooling agreements three equal 

combined poolingequal access ag

preponderance of these agreements c

South American trades Thirteen a

significant impact on US ocean l

Brazil Chile and Colombia

c Space Charter Agreements

Space charter agreements autho

chartering of vessel space or con

vessel operators The essential 

this type is to facilitate carrier 

in given trade routes beyond tha

available Space chartering arrang

into for one of two purposes 1 

authorize chartering only when circ

control prevent it from shipping c

avoiding unnecessary delays andor 

2 strictly commercial space chart

operational undertakings among 

rationalization of overall fleet 

overtonnaging in a given trade 

generally contains authority to ag

and the exchange of equipment At 

there were 27 active space charters 

87
d Discussion Agreements

Discussion agreements provid

carriers by water and other perso

jurisdiction or conferences ther

recommend action on matters of 

agreements do not as a ru

implementation of agreements o

matters discussed without furthe

At the conclusion of fiscal y

agreements in effect

e Joint Service Agreements

Joint service and consortia 

new and separate line or servic

independent liner operators as a 

The resulting line or service 

generally fixing its own rates 

issuing its own bills of ladi

strictly confined to that specifi

authorizing its operation

At the conclusion of fiscal 

consortia agreements were in ef

major US foreign trade with se

automobile carrier operations 

services

88
f Marine Terminal and Shoreside 

Marine terminals operated 

entities provide the facilities a

cargo between land and sea car

delivery of cargo to shippers and 

into between terminal operators a

Shipping Act 1916 eg those i

other use of property dock or be

be performed for carriers may 

Commission under section 15 of the 

enactment of the Shipping Act o

agreements which are still r

Commission no longer require 

intervention by the Commission or 

become effective 45 days subseq

Commission is investigating the p

of these terminal agreements 

regulation would not be impaired b

During fiscal year 1984 the 

142 agreements and agreement mod

and provision of port and terminal 

The Commission is also charge

management agreements pursuant to 

Act of 1980 PL 96 325 94 Stat 

such agreements to the extent th

collectively bargained fringe ben

uniform manhour basis regardles

89
of vessel or equipment utilized 

filing with the Commission Duri

management agreements of this type 

BUREAU OF TARIFFS

The Bureau of Tariffs pla

analyzes programs and activities 

of services provided by common ca

such carriers and terminal operato

offshore commerce of the United 

rejects tariff filings appro

permission applications and 

collaborating with the Bureau o

elements of the Commission as wa

proceedings by the Commission 

for the licensing of ocean f

provisions of the Shipping Act of 

777 the certification of the fina

and operators of passenger vessels 

by nonperformance of voyages or r

The Bureau develops longrange pla

standards and rules and regulatio

activities

During the fiscal year it 

Commission srules pertaining to t

foreign commerce and those relating 

90
freight forwarders to bring them 

Shipping Act of 1984 The signifi

the Shipping Act of 1984 were 

contracts the prohibition of lo

contracts are in conformance with a

that NVOCCs file anti rebate cert

licensing and regulation of oce

addition under the provisions o

carriers are no longer required to 

reveal in intermodal tariffs the 

rate

Foreign Commerce

Tariff Activity

In fiscal year 1984 the 

increased by 14339 or approximate

official tariffs on file increase

over the previous fiscal year

During the fiscal year the C

to place cancelled tariffs on m

keeping purposes in lieu of the p

to government storage facilities 

to active tariffs were also trans

shelf space in the tariff librar

1984 a total of approximately 2 

active tariff cancelled pages had 

Additional tariff activity is summ

a

91
b

Service Contracts

The Shipping Act of 1984 fo

service contracts into the ratem

States foreign commerce It is e

will play a significant role in th

is defined in the Act as a 

an ocean common carrier or confere

a commitment to provide a certain 

a fixed time period and the ocea

commits to a certain rate or rate 

service level such as assur

rotation or similar service fea

specify provisions in the event of 

either party

Between the effective date o

June 18 1984 and the end of f

contracts were filed These 

individual ocean common carriers 

involved 155 primary and 34 se

shipper is the person or firm 

secondary shipper is the person 

contract as a subsidiary or affili

Of the 160 service contracts file

carrier

The service contracts filed 

commodities including freight al

of the contracts included the Atl

92
of the United States and the Far E

and South America both inbound an

of contracts were filed in the Tra

The Commission sinterim r

contracts became effective on Jun

were scheduled to become effective 

At the close of the fisca

contracts filed was increasing st

the increased filings will con

especially after the final s

effective on December 15 1984

c Electronic Tariff Filings

The Commission at the prese

filing of tariff pages provide

physically located in its Washin

the increasing volume of tariff f

by carriers both electronically a

space has become a problem The 

a rule which would amend its fore

filing rules by permitting the 

outside of the Commission soffice

its offices are located This ru

at the close of the fiscal year

93
d Proposed ADP Indexing and Rel

Library

The Commission implemented a 

indexing of the tariff library whi

1 the name of every carrier with 

the scope of each carrier s op

tariffs and 3 the names of all 

conference or agreement tariff 

complete and continually updated al

of all tariffs on file

e

Significant Activities within 

The US AtlanticEuropean tra

degree of stability in fiscal yea

structural changes During fis

AtlanticEuropean conferences obta

were successful in consolidating an

lines individual intermodal tarif

member lines who also served the 

trades as independents created a 

area At the end of the fiscal ye

to merge the South Atlantic and No

would result in a single outbound 

tariff in the US AtlanticEuropean 

With respect to rate increases 

the North Atlantic outbound confere

rate increases while the inbound 

established four general rate increa

94
f Surcharge Activity

Following an extended perio

respect to the application of var

granted a surcharge on short notic

the conference in the Persian G

necessary to offset the increase 

to the hostilities occurring in th

New charges identified a

charges were filed by conferenc

trades to be implemented for a 4

1983 The tariffs did not ind

charges or what the charges co

requested to submit a detailed 

charges were postponed to January 

to February 20 1984 None of 

since all were cancelled between F

9

Proposed Rulemaking Proceedin

Publishing and Filing Tariffs 

Foreign Commerce of the Unite

Practices by NVOCCs

On July 25 1984 the Comm

relating to the practice of Non V

NVOCCs combining cargo to atta

practice being commonly known as 

would establish tariff filing reg

to describe in its tariffs the u

coloading Further the rule

95
document such shipments and provid

which explains the liability of 

would also prohibit special rates 

exclusive use of other NVOCCs

The Commission received co

freight forwarders conferences a

comments which were due September 

the Commission in fiscal year 1985

h

Anti Rebating Certification P

On September 20 1984 purs

Final Rule to implement the Sh

expanding the anti rebate ce

published in the Federal Register 

1984 Previously all vessel op

foreign commerce of the United S

anti rebate tariff provision in a

anti rebating certification by May 

December 15 1984 all non vesse

the foreign commerce of the Unite

tariff provision and certification 

1984 all common carriers in the 

States must file an anti rebating 

each year

96
i Trade Monitoring

The increase in carrier comp

trade resulted in a determination 

Westbound Conference to terminate 

conference tariffs effective Oc

members are filing independent 

published effective dates of No

conference was made up of 10 m

different tariffs The former mem

tariffs each with a complete set 

structure It is anticipated t

specific rate pages will be filed 

limited rate structures before th

date of the independent tariffs

j Special Permission Tariff Com

The staff during fiscal 198

various blanket and ongoing specia

that apply in both the foreign a

Specific changes to these waivers 

the Commission

k Loyalty Contracts

As of September 30 198

independent line had terminated 

rate contracts in order to confor

which prohibits the use of loyalty 

97
with the antitrust laws One 

terminated its loyalty contract b

Business Review Letter from the De

that its loyalty contract is not vi

1 Controlled Carrier Program

The receipt of controlled 

applications decreased in fiscal y

year 141 controlled carrier specia

processed as opposed to fiscal y

carrier special permission applicat

On October 28 1983 Malaysia 

Berhard MISC filed a rebuttal to 

notification that it was consid

controlled carrier Based on th

Commission determined on December 

that time was not that of a control

On February 1 1984 an Eg

Company was added to the list of c

The Commission reviewed a 

Compania Chilena de Navegacion 

requesting that the carrier be remo

of controlled carriers The Comm

no longer state controlled due 

Government of half of its interest 

Therefore CCNI was removed from 

controlled carriers on February 7 

98
CCNI and the addition of MISR the 

by the Commission as controlled rem

Flota Bananera Ecuatoriana 

Commission by letter dated August 

criteria for classification as a 

meaning of sections 38 and 9 o

Classification of Flota is expected 

a rebuttal from the carrier

The staff is currently exam

Corporation of the Philippines 

Pacific Line a Republic of Nauru 

Saudi Arabian carrier and Suda

Sudanese carrier to determine if 

controlled carriers Determinatio

carriers should be made early in fis

Domestic Commerce

The Intercoastal Shipping Ac

18a of the Shipping Act 1916 

charges and rules describing the p

the US domestic offshore trades 

requires the Commission to ensure th

domestic offshore carriers are jus

reviews and analyzes tariff filings 

terminal operators in the domestic 

US Mainland and Alaska Hawaii 

Samoa US Virgin Islands Midw

Northern Mariana Islands

99
Tariff Activity

The Office of Domestic Ta

offshore tariffs filed by 345 ca

filed by 328 terminal operators 

domestic tariff revisions and 0

filed during the year In a

applications were processed 

statistics are summarized in Appe

a

b Significant Commission Activ

OS MainlandPuerto RicoVirgin 

A proposed general rate incre

by SeaLand Service Inc with 

January 16 1984 was considered 

to become effective as scheduled 

connection with protests submit

support data submitted by SeaLand 

was found that the representatio

sufficient to warrant suspension 

The GRI covered the trades betwe

and ports in Puerto Rico

On June 15 1984 SeaLand 

Application No 514 for an ind

granted under FMC Special Permiss

to expire on June 30 1984 Th

granted permitted SeaLand to f

100
FMCF No 34 and 53 on less than 

meet the rates of a competitor w

Maritime Commission regulation

The Commission considered 

indefinite extension on June 29 

extension was sought the Commissio

period of one year to expire June 

designated as Special Permission No 

OS MainlandAlaska

On October 19 1983 the Com

of Kugkaktlik Ltd a common carr

Bethel Alaska and eight villages 

in Alaska for an extension of its 

regulatory rate requirements which 

1980 Kugkaktlik requested an ext

expansion of the exeption to includ

of Quinahagak Goodnews Bay and P

Kuskokwim River and Mekoryuk on 

included the addition of two vesse

The requested extension was 

Commission instituted an investig

83 54 By order served on June 5 

tradewide exemption from the t

section 18c of the Shipping Act 

section 2 of the Intercoastal Ship

844 to all common carriers prov

Alaska and villages in the Kuskokwi

Platinum to Mekoryuk 101
Freight Forwarders

In 1961 section 44 of the 

841b vested the Commission with 

regulation of independent ocean 

freight forwarding industry is 

effect hold themselves out to sh

hire Ocean freight forwarde

arranging for the ocean transp

carriers and by handling the p

related to such exports Oce

payment for handling an export 

Forwarders also receive booking 

carrier whose vessel was selected 

cargo

Congressional findings in 19

ocean freight forwarders led to 

the Shipping Act 1916 At that t

trades were rampant Given the 

favorable climate for US 

businesses which lack the expert

Congress found that licensing a

freight forwarders was necessary 

preferential rebates and to 

incompetent and financially irresp

from operating as ocean freight fo

of ocean freight forwarders has i

initiated malpractices are now mo

rule

102
The continued maintenance 

technical qualifications and finan

freight forwarder are currently 

issued by the Commission and a su

be maintained on file with the 

license need not be renewed The 

the number of offices through wh

provides ocean freight forwarding 

With the enactment of t

Commission sregulatory responsi

statute deleted section 44 of 

licensing of ocean freight forward

the new shipping statute the bas

essentially in place Howeve

shippers from receiving a license 

person that is individual co

receive a license if found q

forwarders are barred from collec

on shipments in which the forw

interest

The determination of whether 

person to act as an ocean frei

commerce of the United States is 

forwarding experience and that ps

fit willing and able criterion 

repealed section 44 of the 1916 A

103
The new statute also provid

forwarders in the domestic offsho

are not required to obtain a lice

entities required to file a sure

forwarders are still subject to t

1916 Act that now apply solely t

United States

Agreements by and among forw

commerce of the United States are 

with the Commission for approval u

such agreements are not afforded a

statute

During fiscal year 1984 the C

fortyfive applications for ocean 

addition to the thirtythree app

year 1983 One hundred twentyeig

approved one was denied three 

processing stage and thirtytwo 

returned to the applicants On

issued licenses were revoked pri

failed to maintain the surety bonds 

In addition to applications fo

1984 the Commission received one h

requesting approval of transfe

organizational changes Thirtyeig

and other organizational changes 

previous fiscal year One hundre

104
were approved during fiscal year 

administratively closed as applic

their requests

Onsite compliance investiga

the Commission seffort to ensure 

forwarders comply with the provisio

the Commission sregulations 

fiftyeight investigative reports 

fourteen of these reports resulte

letters or referral to the Burea

assessment of appropriate civil pe

determined to require no formal co

Other activities during 

processing of seven hundred th

including new bonds riders to 

bonds 2 the review of twenty s

by ocean freight forwarders pur

rules 3 the review and proce

complaints concerning in the maj

of freight charges by forwarders to 

review of eight hundred thirtyeig

required to be filed by forward

statute and the Commission simple

At the end of the year there 

twentyseven licensed ocean freig

increase of twentyeight licensees 

105
Financial Analysis

The Office of Financial A

financial expertise to help ens

for the transportation of cargo 

common carriers in the domestic 

the United States The Office a

to other activities within the C

The Office of Financia

contributions to

the compromise

a study of Com

assessment and 

penalties and to the developme

penalties

In connection with the Coms

Office participated in the dev

index and freight forwarder ind

the geographics of tariffs and se

The Office continued to mo

in the domestic offshore commer

effort involved the receipt and r

data submitted in compliance wit

The staff also evaluated the fina

of a general rate increase in the 

It is anticipated that the 

efforts to the continuing au

compliance with section 18a of 

also require significant staff inv

106
The Federal Maritime Commissi

submitted by vessel operators enga

trades to be prepared in conformi

promulgated by the Maritime Admi

Transportation The recent mo

accounts will require the amendmen

revision of the forms used to

dates These changes will result in 

burden imposed on carriers operat

trades

re

Passenger Vessel Certification

The Commission is responsible 

and 3 of Public Law 89 777 46 USC 

been implemented by the Commissios

540 Security for the Protecti

charterers and operators of Americ

berth or stateroom accommodations 

which embark passengers at United 

that they are financially respons

they incur for death or injury to 

voyages to or from United States 

passengers by refunding deposits 

they fail to perform voyages or cr

Section 2 of the law as w

540 24acontain a schedule to d

required for death or injury lia

107
number of passenger accommodatio

meeting

regulations

the

is

requirements

issued a Certifica

of s

Section 3 of the law place

Commission to determine the am

indemnification of passengers in 

transportation Such factors as 

itinerary fare structure numbe

served type of operation past e

are considered by the Commission 

evidence of financial responsib

Performance

Persons must qualify separ

means of insurance surety bond e

self insurer A different mea

responsibility may be selected for 

The certificates must be p

Customs officials at the port or p

from the United States Under the 

shall refuse clearance of the 

certificates on board until such 

compliance with the law

During fiscal year 1984 th

applications for performance cer

for casualty certificates and 50 

existing certificates

108
Also 13 certificates were re

withdrawn from the US trade or s

over 100 vessels remained certified

BUREAU OF HEARING COUNSEL

The Bureau of Hearing Counsel 

in formal adjudicatory dockets no

rulemaking proceedings when design

other proceedings initiated by the 

serve as Hearing Counsel where 

formal complaint proceedings instit

1916 Shipping Act and section 11 o

addition to the formal proceed

participates as a party the Bure

proceedings in order to ascertain 

shipping industry andor the gen

from purely private disputes betwee

adequately developed On reques

advice to the staff and the shipp

Bureau participates in matters of 

the Commission Bureau attorneys 

developed by the Bureau of Inve

claim letters and finalize the 

civil penalty claims for alleged 

statutes and regulations If se

Bureau acts as prosecutor in forma

may involve the assessment of such 

109
During fiscal year 1984 

adjudicated 45 malpractice case

penalties Appendix E provides a 

penalties assessed or settled

As of the close of fiscal 

formal proceedings pending Duri

were received and 33 were com

proceedings on hand as of Sep

provided advice to the staff on m

fiscal year

The Bureau participated ext

rules and regulations for the imp

1984

During the year a new opera

Bureau This plan will be fully i

and will strengthen the Bureau s

the Commission sstaff In add

provide for closer coordination 

bureaus and offices in carrying o

responsibilities under the Shipping 

BUREAU OF INVESTIGATIONS

The Bureau of Investigations 

the United States to curtail 

malpractices by carriers shippers 

subject to the Shipping Acts In 

110
office in Washington DC office

Francisco New Orleans San Juan 

These offices represent the Comm

area provide liaison between th

industry and the shipping pu

violations of the statutes and r

Commission Such violations can 

and shipper malpractices such 

charges and misclassification m

of cargo shipments unlawful commo

and domestic offshore trades unl

or other persons subject to the 

unlicensed ocean freight forwarde

Fiscal year 1984 was the fir

of the Investigative Record Inform

in July 1983 This system ge

reports to assist in investigativ

planning In addition use of 

commercial shipping data has fa

entities subject to the juri

Utilization of IRIS and other sop

sources coupled with the e

priorities has enabled the Burea

develop high profile quality c

impact in fulfilling the mission 

With continued reliance on n

year 1985 it is expected that 

the shipping industry will be enh

11
At the beginning of fiscal ye

investigations in progress 

investigations were initiated pro

scheduled for investigation Co

425 leaving 171 cases pending at 

Appendix F summarizes the Bureau s

112
ADMINISTRATIVE ACTIVITIES

Several offices of the Co

administrative support of the Coms

The Office of Personnel p

management programs including r

training and development positio

safety and health and employee r

Office works closely with opera

meet employee organizational 

Significant achievements in these 

year 1984 are outlined below

Program Development

During fiscal year 1984 the 

actions taken and legislative 

Office of Personnel Management 

regulatory changes in the a

Performance Appraisal and Merit 

System where new regulations 

collaborated with staffers from 

policies and procedures A task 

Office to anticipate development

affecting Commission personnel m

also examined its procedural ope

viable approaches to data autom

developments was the development 

Time Employment

11
Employee Relations

The Office continued its ef

environment of all Commission 

programs relating to health and s

fair was conducted giving employe

health plans and facilities prior t

on the purchase of health insu

continued to be provided to th

retirement and included the offe

retirement seminar The Office a

prohibitions and leave accou

114

Significant new programs establish

included the publication of proce

Post1956 Military Service Credit R

guidance to employees covered by 

regulations Efforts continued 

supervisors to their responsibilit

performance conduct awards 

connection the Office issued memo

and supervisory responsibilities 

issued by the Merit Systems Protec

informally counseled with respect 

related problems the Office worked 

advisors to ensure that employees 

non disciplinary adverse actions we

The Office also administered the 
Program granting awards to employ

or special achievements

Performance Appraisal

During fiscal year 1984 

Commission sthird annual Merit P

addition the Office refined and 

managerial and supervisory employ

preparing new or revised performa

changes in employee duties

Personnel Reduction Programs

During fiscal year 1984 the 

of a reduction in force in the 

comprehensive guidance to manage

be followed and providing deta

benefits to all employees affe

Congressionally approved operatin

required to prepare for shutdow

until an appropriation bill was p

by the President

Staffing

In addition to on going rec

year 1984 the Office responded to 

fill newly established or redefi

missions were directly affected b

11
of 1984 In anticipation of the 

strategies were developed in 

occupations To cope with the co

in its clerical ranks the Office 

to ensure that loss of employees 

continuity in Commission programs 

feasibility of effecting internal 

program needs Efforts continued 

within funding limitations incl

employment volunteer and coopera

Training

After being able to provide o

training for employees in previous 

agencywide training program dur

addition in an effort to meet prog

by the Shipping Act of 1984 the O

histories and academic profiles of 

and offices for the purpose of de

could be enhanced

Position Classification

During fiscal year 1984 the O

to describe newly created positio

number of realigned organizations 

the year was an initial assessment 

through 15 grade range and the pre

116
Office of Personnel Management 

Commission would take to improve gra

this range without sacrificing effi

The Commission continued its analys

with recommendations for employee p

reviewed evaluation statements we

met with supervisors to discuss a

approaches to enhance certain posit

The Office of Budget and Fin

the Commission sfinancial manageme

for optimal utilization of the Coms

manpower resources The Office 

government budgetary and financia

developing annual budget justifica

Congress and the Office of Manage

also administers internal control 

travel and cash management programs

During fiscal year 1984 

electronic funds transfer system fo

in order to speed up cash going in

paperwork Payments processing 

advantage of available discounts a

problem payments An automated sys

payments was established to aid 

facilitate efficient utilization of 

117
The Office continued to r

control for accountability of a

where necessary to prevent frau

procedures were established fo

disposition of promotional mater

while on official travel Promo

fare coupons frequentflyer 

compensation for denied boarding 

the carrier gifts merchandise 

procedures enable the Commission 

travel funds whenever benefits in 

obtained from government funds u

addition a revised Commission O

developed by this Office and im

year The major impacts of the 

control over official passports 

repository for official passports 

between official travel assignme

for signing out and returning off

addition to clear statements of p

for obtaining official passports 

established a total system fo

control retrieval and cancellati

Federal efforts in controlling pa

Appendix G summarizes ap

receipts for fiscal year 1984

118
APPENDICES

2

0

N

2

2

0V

W

2

F

Q

2

J

w

W

W

a

a2

Fi

U

ji

0z

20

uOFLL

0

ORGANIZATIO

W

2

U

APPEND

35

0

121
APPEND

COMMISSION PROCEEDINGS 

Formal Proceedings

Decisions 

Reconsiderations 

Discontinuances

Not Reviewed

Dismiss7

Remand 

Tota

Special Dockets 

Informal Dockets 

Oral Arguments 

Rulemakings

Final Rules Issued 

Discontinued 

Tota

122
APPENDIX 

AGREEMENT FILINGS AND STAT

Agreements Filed in FY 1984 includ

Foreign and Domestic Commerce 

Terminals

Labor Management

Conference Reports Submitted for Co

Shippers Requests and Complaints 

Minutes of Meetings

SelfPolicing of Conference and Rat

Pooling Statements 

Operating Reports

Agreements on File as of September 

Conference

Interconference

Pooling

Joint Service 

Sailing 

Transshipment

Cooperative Working Agency Cont

Terminal 

Labor Management Agreements Exem

123
APPEN

TARIFF FILINGS AND STAT

Foreign Commerce

Total No of Tariff Page Filings 

Total No of Tariff Page Filings 

Total No of Tariffs on Hand 1083

Total No of Tariffs on Hand 1084

Domestic Commerce

Total Number of Tariff Pages Rece

Domestic Offshore

Terminals

Total Number of Tariff Pages Rejec

Domestic Offshore

Total Number of Tariffs on Hand 108

Domestic Offshore

Terminals

Total Number of Tariffs on Hand 108

Domestic Offshore

Terminals

124

Special Permission Applications

Special Permission Applications R

Granted 

Withdrawn 

Denied 

Special Permission Applications

Domestic Offshore

Granted 

Withdrawn 

Denied 

Pending 

Investigation and Suspension Memor

Domestic Offshore

Completed 

Pending 
APPEND

CIVIL PENALTIES ASSESSED OR S

NAME 

Greenbelt Cooperative Inc 

TCI Carriers Inc 

formerly Transocean

Shipping Inc

Pacific Atlantic Trading Company 

Black Sea Shipping Co 

Unsworth Co Inc 

Costa Line Cargo Services 

Boston Consolidation Inc 

Venezuelan Line 

Armand Ventura 

T J Colbeck Co USA 

Unlimited Cargo Service Co Inc 

Valdez Line 

Nippon Express 

USA Illinois

Miami Freight Shipping Co 

Dieterle Victory 

Royal Cathay Trading Co 

Selax Transport Int lFF Co 

John Kane sales Co 

Transportes Navieros 

Ecuatorianos Transnave

Honolulu Freight Services 

Intercontinental

Maritima SA

dba IMAR Lines

125
Appendix E cont

NAME 

Transamerican Shipping Corp 

Pan American Container Corp 

Tierra MarAire 

China Interocean Transport Inc 

Conair Corp 

Nigerian Star Line 

Associated Trade Development 

dba Trans World Systems

Neptune Orient Lines Inc 

Hong Kong Islands Shipping Corp 

N Y K Line 

Humphrey MacGregor 

Transeurope Shipping Inc 

Jose Buenaventura 

dba Philippine Express

BLG Swisstrans Inc 

Flota Mercante Grancolombiana 

Andino Chemical Shipping Company 

Maritima Transligra SA 

Expeditors Int lInc 

Votainer Cons Services Southwest 

Hapag Lloyd AG 

Hudsons Int lInc 

Movers Port Service MPS 

Jeuro Container Inc dba Jeuro 

Container Line

Pracht Intl 

CUMULATIVE TOTAL FY 84 

126
APPEND

FIELD INVESTIGATIONS 

Investigations Total Malpract

Pending 1083 365 109 

Opened FY 1984 231 70 

Closed FY 1984 425 105 

Pending 93084 171 74 

127
APPENDIX G

STATEMENT OF APPROPRIATIONS OBLIG

FOR THE FISCAL YEAR ENDED SEP

Appropriations

Continuing Resolutions PL 98107 

For necessary expenses of the Fede

Commission including services as a

by 5 USC 3109 hire of passenger 

vehicles and uniforms or allowance

as authorized by 5 USC 5901 5902 

that not to exceed 1500 shall be 

for official reception and represe

expenses 

Public Law 98 396 98th Congress a

August 22 1984 Supplemental App

Bill to cover increased pay cost

Appropriation availability 

Obligations and Unobligated Balance

Net obligations for salaries and ex

the fiscal year ended September 30 

Unobligated balance returned to Tre

Statement of Receipts Deposited with t

Treasury for the Fiscal Year Ended Septe

Publications and reproductions

Fees and Vessel Certification

and Freight Forwarder Applications 

Fines and penalties 

Total general fund receipts 

128
This report is t

the efforts of the O

of the Federal Mar

We would especial

Jane E Gregory Ka

and Tonya M 

for their valuable 

administrative s

preparation of 

129