Federal Maritime

Commission

60th Annual

Report

for

Fiscal Year

2021

Table of Contents

Letter of Transmittal 1

Members of the Commission 3

List of Acronyms 5

FMC Mission, Strategic Goals, and Functions 7

Strategic Goal 1 7

Strategic Goal 2 8

Statutory Authority 8

Year in Review 11

Efficiency and Competition 17

Strategic Goal 1 17

Agreement Filings and Review 17

Monitoring Regulated Entities 19

Carrier Alliance Agreements 19

Market Shares of Alliances 21

Alliance Carrier Capacity 22

Tariffs/NRAs/NSAs and Service Contracts 24

International Cooperation 25

Competitive Impact of Ocean Carrier Alliance Joint Purchases of Certain 

Covered Services 25

Protecting the Public 29

Strategic Goal 2 29

Fact Finding Investigations 29

Licensing 31

Passenger Vessel Program 32

Consumer Affairs and Dispute Resolution 33

Enforcement and Compliance 34

Developments in Major U.S. Foreign Trades 37
Containerized Capacity 38

Containerized U.S. Imports and Exports 39

Commodities Imported and Exported 41

Top Twenty U.S. Liner Cargo Trading Partners 45

Foreign Shipping Practices Act 47

Controlled Carriers 49

Formal Investigations, Private Complaints, and Litigation 51

Formal Proceedings 51

Rulemakings and Exemptions 54

FMC Information Technology 59

Glossary 61

Appendices 65

A – FMC Organization Chart 65

B – FMC Senior Officials 66

C – Statement of Appropriations, Statement of Custodial Activity, and 

Financial Operations 67

D – Agreement Types 68

E – Agreement Review Standard 70

F – Standard for Practices in Handling Property 72
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Letter of Transmittal

FEDERAL MARITIME COMMISSION

800 North Capitol Street, N.W.

Washington, DC 20573-0001

March 31, 2022

To the United States Senate and House of Representatives:

On behalf of my fellow Commissioners, and pursuant to section 103(e) of Reorganization 

Plan No. 7 of 1961, and section 208 of the Merchant Marine Act, 1936, as amended, at 46 U.S.C. 

§ 46106(a), I am pleased to share with you the 60th Annual Report of the Federal Maritime

Commission, Fiscal Year 2021.

Sincerely,

Daniel B. Maffei

Chairman
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Members of the Commission

Fiscal Year 2021

Michael A. Khouri

Commissioner

Appointed 2009

Term Expired 2021

Carl W. Bentzel

Commissioner

Appointed 2019

Term Expires 2024

Rebecca F. Dye

Commissioner

Appointed 2002

Term Expired 2020

Louis E. Sola

Commissioner

Appointed 2019

Term Expires 2023

Daniel B. Maffei

Chairman

Appointed 2016

Term Expires 2022
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List of Acronyms

ALJ Administrative Law Judge

ANPRM Advance Notice of Proposed Rulemaking

AR Area Representative

BOE Bureau of Enforcement

CADRS Office of Consumer Affairs and Dispute Resolution Services

CBP U.S. Customs and Border Protection

DOJ Department of Justice

FMC Federal Maritime Commission

EPA Environmental Protection Agency

FSPA Foreign Shipping Practices Act

FTC Federal Trade Commission

IT Information Technology

MOU Memorandum of Understanding

MTO Marine Terminal Operators

NESOI Not Elsewhere Specified or Indicated

NPRM Notice of Proposed Rulemaking

NRA Negotiated Rate Arrangement

NSA NVOCC Service Arrangement

NVOCC Non-Vessel-Operating Common Carrier

OFF Ocean Freight Forwarder

OTI Ocean Transportation Intermediary

PIERS Port Import Export Reporting Service

PVO Passenger Vessel Operator

TEU Twenty-Foot Equivalent Unit

TSA Terminal Services Agreement

VOCC Vessel-Operating Common Carrier
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FMC Mission, Strategic 

Goals, and Functions

The Federal Maritime Commission (FMC or Commission) is an independent agency responsible for the regulation of oceanborne transportation in the foreign commerce of the United 

States for the benefit of U.S. exporters, importers, and the U.S. consumer.

The FMC's Mission is:

• Ensure a competitive and reliable international ocean transportation supply system that 

supports the U.S. economy and protects the public from unfair and deceptive practices.

The Commission achieves its mission by ensuring that the fundamental dynamics of a 

free, open, and competitive ocean transportation market drive economic outcomes. To that 

end, the Commission is committed to faithfully administering the Shipping Act, employing a 

minimum of government intervention and regulatory costs and by placing a greater reliance 

on the marketplace.

Strategic Goal 1

Maintain an efficient and competitive international ocean transportation system.

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

public by:

• Reviewing and monitoring agreements among ocean common carriers and marine 

terminal operators serving the U.S. foreign oceanborne trades to ensure that any joint 

or collective activities do not cause substantial increases in transportation costs or 

decreases in transportation services;

• Maintaining and reviewing confidentially-filed service contracts and Non-VesselOperating Common Carrier Service Arrangements to guard against detrimental effects 

to shipping;

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

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

commerce;

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

tariff systems and electronically available;

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

ensure they are just and reasonable; and

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

business practices in U.S. foreign shipping trades.
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Strategic Goal 2

Protect the shipping public from unlawful, unfair, and deceptive ocean 

transportation practices and resolve shipping disputes.

The FMC protects the public from financial harm and contributes to the integrity and security of the U.S. supply chain and transportation system by:

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

practices of common carriers, Marine Terminal Operators (MTOs), and Ocean Transportation Intermediaries (OTIs) that violate the Shipping Act;

• Licensing OTIs with appropriate character and adequate financial responsibility;

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

and between cruise vessel operators and passengers;

• Identifying and holding regulated entities accountable for mislabeling cargo shipped 

to or from the United States; and

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

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

Statutory Authority

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

Code at sections 40101 through 44106, are:

• The Shipping Act of 1984 (Shipping Act), 46 U.S.C. chapters 401-413:

• The Foreign Shipping Practices Act of 1988 (FSPA), 46 U.S.C. chapter 423;

• Section 19 of the Merchant Marine Act, 1920 (1920 Act), 46 U.S.C. chapter 421; and

• Sections 2 and 3 of Pub. L. No. 89-777, 80 Stat. 1350, 46 U.S.C. chapter 441.

In addition, section 834 of the Frank LoBiondo Coast Guard Authorization Act of 2018 

(LoBiondo Act) is codified at 46 U.S.C. § 3503(b)(1)(C).
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Year in Review

The challenges resulting largely from 

COVID-related supply and demand swings 

continued to dominate the agenda of the Federal Maritime Commission in 2021.

In Fiscal Year 2021, nearly 28 million 

Twenty-Foot Equivalent Units (TEUs) were 

imported through U.S. ports, an increase of 

21% from Fiscal Year 2020 totals. If including 

volumes entering the United States through 

Canadian ports, that total grows to more than 

29 million TEUs of cargo, also a 21% increase 

from the preceding year.

While conditions at Los Angeles and Long 

Beach have drawn the attention of the public, 

media, and government officials, container 

ports around the United States handled significant and often record-breaking volumes of 

international trade. Ports in the states of Washington, New York, New Jersey, South Carolina, 

Georgia, Texas, and Florida all reported historic years in terms of cargo moving over 

their gateways. The frequency of vessel calls 

and magnitude of containers arriving in the 

United States has far outpaced the capabilities of inland networks. Personnel, equipment, 

domestic surface transportation, warehouse 

space and infrastructure constraints have all 

contributed to degraded efficiency and reliability of the system which are reflected in 

vessels waiting to berth.

Pandemic-related impacts to the supply 

chain are global in scope—neither limited 

to the United States nor to ocean shipping—

and create interrelated consequences that 

exacerbate the obstacles that transportation 

companies and workers face in moving each 

container from origin to destination. For 

example, a factory or marine terminal closure 

in Asia will impact U.S. surface transportation 

networks and retail operations. Similarly, a 

weather event or lack of warehousing space in 

the United States causes backups at U.S. ports, 

on the seas, and even ports in Asia. Problems 

in Asia and the United States have impacts 

in Europe, and in turn, European problems 

cause complications in Asia. Shippers around 

the world are working through the same 

challenges as those in the United States. The 

interconnected networks that move international commerce are usually beneficial, but for 

the past year, those linkages have meant that 

any problem in one area has a ripple effect on 

the whole system.

It should be noted, however, that America’s 

ocean transportation system, though strained 

by unprecedented demand, did in fact continue to function and processed and delivered 

record amounts of cargo even while dealing 

with COVID-related constraints. Despite 

wide-spread predictions of empty shelves 

and shortages of essential goods during the 

holiday shopping season, most Americans 

experienced no major disruptions thanks in 

large measure to shippers that altered their 

supply chain expectations, transportation 

and logistics companies that came up with 

innovative solutions, and tens of thousands 

of workers who refused to let the system fail.

The Commission’s work has focused on 

improving the circumstances of American 

shippers—and the U.S. consumers who 

depend on them—in these extraordinarily 

challenging circumstances. The Commission has sought to use its existing statutory 
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authorities, found at 46 U.S.C. §§ 40101 

through 44106, as creatively and effectively 

as possible to address head-on issues related 

to the cost, availability, and reliability of ocean 

transportation services that pose unprecedented challenges to American importers 

and exporters. These efforts include focused 

activities related to compliance, monitoring, 

enforcement, outreach, and consumer assistance. They complement actions being taken 

by other Executive Branch agencies under the 

Biden-Harris Administration’s whole of government response to supply chain challenges 

American shippers and consumers are facing.

Fact Finding 29, “International Ocean 

Transportation Supply Chain Engagement,” 

remained active and focused throughout 2021 

on identifying both COVID-related impacts 

to the supply chain and industry actions that 

can be taken to address them. Established 

in March of 2020 with an original focus on 

the consequences of falling freight volumes 

following the outbreak of the pandemic, the 

work of Fact Finding Officer Commissioner 

Rebecca F. Dye has shifted to what can be 

done to mitigate effects of the cargo surge. 

In November 2020, the Commission approved 

a Supplemental Order for Fact Finding 29, 

adding a formal investigatory function to 

the undertaking. This led to the issuance of 

demand orders served on ocean carriers and 

MTOs to determine if their legal obligations 

related to detention and demurrage practices 

were being met. Information gathered from 

this effort was provided to the Commission’s 

Bureau of Enforcement for review and potential action.

In July 2021, Commissioner Dye provided 

the Commission with eight Interim Recommendations she identified that would 

minimize barriers to private party enforcement of the Shipping Act; clarify Commission 

and industry processes; encourage shippers, 

truckers, and other stakeholders to assist Commission enforcement actions; and support the 

ability of the Office of Consumer Affairs and 

Dispute Resolution Services (CADRS) to facilitate prompt and fair dispute resolution and 

assist shippers in emergency situations. The 

Commission is moving forward with her five 

recommendations—including an additional 

rulemaking—that do not require legislative 

changes. Further recommendations could be 

issued by Commissioner Dye as she continues 

her work on Fact Finding 29.

At the direction of Chairman Daniel B. 

Maffei, the Commission established the 

Vessel-Operating Common Carrier Audit 

Program, along with a dedicated audit team, 

in July 2021. The focus of the program and 

team is to assess carrier compliance with the 

Commission's interpretive rule on detention 

and demurrage, as well as to provide additional information beneficial to the regular 

monitoring of the marketplace for ocean cargo 

services. The Audit Program began its work 

by analyzing the top nine carriers by market 

share for compliance with the Commission 

rule interpreting 46 U.S.C. § 41102(c) as it 

applies to detention and demurrage practices in the United States. The Commission 

is working with companies to address their 

application of the rule and clarify any questions or ambiguities. Information developed 

by this engagement led to the Commission 

issuing in October three best practices related 

to detention and demurrage that promote clarity and certainty about how and when fees 

will be assessed as well as how to challenge 

disputed charges. These recommendations 
60th Annual Report 13

were issued to 25 vessel-operating common 

carriers serving the U.S. and the trade association representing the industry and were 

accompanied by a call for their voluntary 

adoption.

In August 2021, the Commission’s Bureau of 

Enforcement launched an expedited inquiry 

into the timing and legal sufficiency of the 

practices of eight ocean carriers with respect 

to certain detention or congestion-related surcharges. Ocean carriers are subject to specific 

requirements related to tariff changes or rate 

increases, including providing a 30-day notice 

to shippers and ensuring that published tariffs 

are clear and definite. This action was taken in 

response to communications received by the 

Commission from multiple parties reporting 

that ocean carriers were improperly implementing surcharges.

In addition to an enhanced emphasis on 

enforcement, the Commission’s Consumer 

Affairs and Dispute Resolution Services 

bureau handled hundreds of cases involving COVID-related supply chain disruptions. 

Since it is clear that exporters face even greater 

and more complex logistical challenges than 

importers associated with the COVID-related 

import demand surge, Chairman Maffei 

ordered that CADRS have an employee dedicated specifically to assisting exporters.

The Commission was active in rulemaking 

during FY 2021. Work continued on a rule 

to amend regulations governing Passenger 

Vessel Operators (PVOs or cruise lines) in 

order to create a uniform standard for nonperformance of transportation and to make 

clear how passengers may obtain refunds. 

Also, a rulemaking was instituted to allow 

ocean carriers to file service contracts and 

service contract amendments up to 30 days 

after going into effect, making FMC regulatory 

requirements more consistent with contemporary business practices.

The Commission signed a Memorandum 

of Understanding (MOU) with the Department of Justice (DOJ) in July 2021 to foster 

increased cooperation and communication 

in each agency’s respective oversight and 

enforcement responsibilities of the ocean liner 

shipping industry. The MOU establishes a 

framework for the FMC and the DOJ’s Antitrust Division to continue regular discussions 

and review law enforcement and regulatory 

matters affecting competition in the shipping industry. The MOU also provides for 

information and expertise exchanges between 

the agencies that may be relevant and useful 

in meeting their oversight and enforcement 

responsibilities. Such exchanges would be 

conducted in a manner appropriate and 

consistent with applicable legal and confidentiality restrictions.

Given the global nature of the ocean 

transportation system, communication 

and coordination with foreign government 

counterparts is essential. In September 2021, 

Commissioners met with their regulatory 

counterparts from the European Union and 

the People’s Republic of China for the fifth 

biennial Global Regulatory Summit. Three 

broad agenda items were discussed during 

the meeting. First, the parties discussed 

sectoral developments since the start of the 

COVID-19 pandemic including an analysis 

of supply and demand, an identification of 

bottlenecks in the ocean-linked supply chain, 

and the causes of service disruptions. Second, 

the Summit examined actions undertaken so 

far by relevant jurisdictions and authorities 

in response and their results. Finally, the 
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parties discussed the way forward and possible actions to increase resilience and smooth 

operations in the sector.

In September, Chairman Maffei, along 

with Acting Administrator of the Maritime 

Administration Lucinda Lessley, met with 

Parliamentary Undersecretary of State at the 

Department of Transport Robert Courts MP 

and other United Kingdom officials to ensure 

continued cooperation and coordination on 

maritime issues now that the UK has departed 

the European Union.

An important new channel for industry 

engagement opened this year with the Commission’s launch of the National Shipper 

Advisory Committee, created by Congress 

as a part of the Elijah E. Cummings Coast 

Guard Authorization Act of 2020 (Pub. L. No. 

116–283, div. G). The Commission announced 

in September the 24 inaugural members of 

the Committee, which are evenly divided 

between those who represent entities that 

import or export cargo. The Committee will 

advise the Commission on policies relating 

to the competitiveness, reliability, integrity, 

and fairness of the international ocean freight 

delivery system. As of the end of Calendar 

Year 2021, the Committee had already held 

two meetings and its member leaders were 

planning an active schedule for 2022. Other 

segments of the ocean transportation industry 

have expressed interest in the possibility of 

additional advisory committees that would 

allow them to share information with the 

Commission through such a forum.

In addition to formal agency actions, Commissioners have engaged in informal outreach 

to senior executives at leading container shipping lines and MTOs to address and improve 

operational and business challenges affecting 

shippers and the supply chain. Beyond ensuring the Commissioners are aware of the most 

current information available, these conversations have allowed for progress in addressing 

some business and operational challenges.

In the coming year, it is likely that shippers 

in the United States and around the world will 

continue to see high demand on the system 

with associated high costs compared to prepandemic levels. Some are predicting that 

rates will remain high through 2023 and perhaps into 2024. While new vessels ordered in 

2020 and 2021 will begin being deployed in 

2022, final delivery of these ships will stretch 

into the out years. Additionally, it must be 

recognized that until landside constraints 

are better addressed, adding more containercarrying capacity on the sea will do little to 

reduce the costs or improve reliability in 

moving cargo.
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Efficiency and Competition

Strategic Goal 1

A primary function of the Commission is 

to maintain a competitive and reliable international ocean transportation system and 

regularly scheduled liner trade by evaluating and monitoring the use of various types 

of agreement authority for anticompetitive 

effects. Competition among participants in 

U.S. liner trades fosters competitive rates and 

encourages a variety of service offerings for 

the benefit of U.S. exporters and importers, 

and ultimately consumers.

The Shipping Act allows ocean carrier and 

marine terminal competitors to meet, discuss, 

and in some cases, cooperate on certain business issues, but first they must file a written 

agreement with the Commission. The Shipping 

Act is a federal competition law applicable to 

the industry of international liner shipping. 

It contains provisions similar to those found 

in the Sherman Act of 1890, the Clayton Act 

of 1914, and the Robinson-Patman Act of 

1936, and it concerns various prohibitions of 

discriminatory or unfair business practices 

and standards regarding business combinations. The Shipping Act creates a regulatory 

regime separate from the U.S. Department 

of Justice’s enforcement of the antitrust law, 

under which collective ocean carrier or MTO 

activity is evaluated when an agreement is 

initially filed and closely monitored thereafter 

for any adverse impact on competition in the 

trade.

The Commission reviews agreements 

using traditional antitrust law principles and 

economic models to evaluate the potential 

competitive impact of a proposed agreement 

before it may go into effect. The initial review 

and analysis of a proposed agreement and 

subsequent monitoring of the members’ activities under the agreement, should it become 

effective, are designed to identify and guard 

against possible anticompetitive abuse of the 

filed authority, avoid unreasonable increases 

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

prohibited by the Shipping Act.

So long as an agreement complies with 

the relevant Shipping Act and regulatory 

requirements, other federal antitrust statutes 

generally do not apply. Conversely, if a regulated entity violates the Shipping Act, it would 

be subject to penalties, and may, under certain 

circumstances, also be subject to investigation 

and prosecution under the full array of federal 

antitrust statutes.

Agreement Filings and Review

Under Sections 4 and 5 of the Shipping Act, 

46 U.S.C. §§ 40301–40303, all agreements by or 

among ocean common carriers and/or MTOs 

to undertake any of the following are required 

to be filed with the Commission:

•  fix rates or conditions of service,

•  pool cargo revenue,
18 60th Annual Report

•  allot ports or regulate sailings,

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

•  control or prevent competition, or

•  engage in exclusive or preferential 

arrangements.

In FY 2021, the Commission received 159 

agreement filings, including new agreements 

and amendments to, or terminations of, existing agreements. This activity represents an 

increase in filings from the 123 received in 

FY 2020, due primarily to the FMC’s efforts 

to bring agreements into compliance with the 

Frank LoBiondo Coast Guard Authorization 

Act of 2018 (Pub. L. No. 115-282), as discussed 

further below. Those agreements that were 

identified as having joint negotiation authority 

for covered services were required to either 

provide quarterly monitoring reports on their 

joint negotiation activities or to amend their 

agreement to remove that authority. Many 

chose to amend their agreements, thereby 

reducing competitive concerns.

At the end of the fiscal year, a total of 357 

agreements were on file and in effect with the 

Commission, categorized categorized in Table 

1 as follows:

Table 1: Agreements in Effect at End 

of FY 2021

Agreement Type Number in Effect

VOCC Agreements 258

MTO Agreements 90

Assessment 

Agreements 9

TOTAL 357

Agreement Review Process

Agreements become effective 45 days 

after filing unless the Commission has 

requested additional information to 

evaluate the competitive impact of the 

agreement. All agreements are reviewed 

pursuant to the standard set forth in 

section 6(g) of the Shipping Act, 46 

U.S.C. § 41307(b)(1).

The Commission has the authority to 

reject a pending agreement filing if it 

determines the filing fails to meet the 

Shipping Act and the Commission’s 

regulations requiring filed agreements 

to be clear and definite, or if the filing 

is outside the Commission’s jurisdiction.

The Commission may seek to enjoin 

the operations of an agreement 

under 46 U.S.C. § 41307(b), where it 

determines that the agreement could 

reduce competition to the point of 

unreasonably impacting the market, or 

substantially lessen competition in the 

purchasing of certain covered services 

as defined in the LoBiondo Act.

Effective agreements are exempt from 

U.S. antitrust laws, and instead, are 

subject to Shipping Act restrictions and 

Commission oversight.
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Monitoring Regulated Entities

Agreements filed with the FMC that present 

competitive concerns are monitored regularly 

for actions that might result in unreasonable 

increases in transportation cost or decreases in 

transportation services, as well as indicators 

of prohibited acts under the Shipping Act. In 

FY 2021, 53 agreements were subject to monitoring, including requirements to file meeting 

minutes and monitoring data with the FMC.

While a great deal of attention is placed on 

the ocean carrier alliances (described below), 

they comprise only 3 of the 53 agreements 

that are actively monitored. MTO rate discussion agreements, chassis pools, and carrier 

discussions of data and digital information technology are also actively monitored. 

Additionally, while carrier rate discussions 

declined in favor of capacity discussions, 

these agreements still exist in some trades, 

particularly the north-south, Caribbean, and 

Bermuda trades, and are actively monitored.

Carrier Alliance Agreements

A core function of the FMC is monitoring agreements filed by Vessel-Operating 

Common Carriers (VOCCs). This includes the 

three global shipping alliances: 2M, OCEAN 

Alliance, and THE Alliance. The FMC receives 

information from the members of these alliances to assist in the agency’s monitoring 

process, including revenue, total capacity 

operated and volumes moved, and notices 

of blank sailings. That information is carefully 

analyzed by the FMC staff to determine trends 

in the marketplace and to identify potential 

anticompetitive or prohibited practices.

The 2M Alliance consists of Maersk Line 

(HQ: Denmark) and Mediterranean Shipping 

Company (MSC; HQ: Switzerland), the largest 

and second-largest ocean carriers by global 

capacity, measured in twenty-foot equivalent units (TEUs). The three ocean carriers 

that make up the OCEAN Alliance are CMA 

CGM (including its affiliate APL; HQ: France), 

COSCO (including its majority-owned affiliate OOCL; HQ: China), and Evergreen (HQ: 

Taiwan). THE Alliance (THEA) is comprised of 

four members: Hapag-Lloyd (HQ: Germany), 

Hyundai Merchant Marine (HMM; HQ: South 

Korea), Ocean Network Express (ONE; HQ: 

Japan), and Yang Ming (HQ: Taiwan). Among 

filed ocean carrier agreements, the three alliance agreements have the greatest potential to 

Agreement Monitoring

Process

The FMC receives information from 

the members of these alliances to 

assist in the agency’s monitoring 

process, including revenue, total 

capacity operated and volumes moved, 

and notices of blank sailings. That 

information is carefully analyzed by 

FMC staff to determine trends in the 

marketplace and to identify potential 

anticompetitive or prohibited practices.
20 60th Annual Report

cause or facilitate adverse market effects based 

on the agreements’ authority and geographic 

scope in combination with underlying market 

conditions.

The Commission’s Bureau of Trade Analysis (BTA) relies on a combination of individual 

vessel operator confidentially-provided data 

and information from commercially-available 

industry data to monitor and analyze container 

carrier freight rates and service market trends. 

Pursuant to 46 C.F.R. § 535.702(d), in November 2020, the FMC revised alternative periodic 

reporting requirements for alliances moving 

away from quarterly monitoring reports to 

monthly monitoring with information to be 

submitted no later than 30 days from the end 

of each calendar month.

Chart 1: Transpacific Market Shares of Carriers and Alliances, First Half of 2021

*Due to rounding, some totals may not correspond with the sum of the separate figures
60th Annual Report 21

Market Shares of Alliances

Collectively, the three global alliances had 

market shares of 91 percent in the transpacific and 89 percent in the transatlantic trades 

in the first half of 2021, according to Port 

Import Export Reporting Service (PIERS), 

a commercial provider of U.S. waterborne 

trade data. Given these considerable market 

shares, the Commission closely monitors 

the alliance parties’ activities through its 

prescribed periodic reporting requirements, 

which not only include submitting data, but 

also filing meeting minutes and semi-annual 

meetings between the FMC staff and alliance 

representatives.

As shown in Chart 1, OCEAN Alliance is 

the largest carrier alliance in the transpacific, 

moving 43 percent of cargo in the first half 

of 2021. They are followed by THE Alliance 

with 25 percent, and the 2M Alliance with 23 

percent. Compared to the first half of 2020, 

2M has increased its market share from 19 

percent to 23 percent due to the reestablishment of the services suspended in early 2020 

and both Maersk and MSC adding vessels to 

existing service strings. In comparison, THE 

Alliance’s market share dropped from 31 percent in the first half of 2021 to 25 percent in the 

first half of 2020. OCEAN Alliance’s market 

share remained relatively stable in 2021 at 43 

percent versus 44 percent in 2020.

As shown in Chart 2, in the transatlantic 

trade, the 2M carriers lead the market, moving 

42 percent of all cargo between the U.S. and 

Europe in the first half of 2021. This represents an increase in share from 38 percent 

in the first half of 2020. THE Alliance is the 

second-largest alliance in this trade, moving 

29 percent in the first half of the year. However, their share dropped 3 percentage points 

compared to the first half of 2020. OCEAN 

Alliance is the smallest of the alliances in this 

market, moving 18 percent of cargo in the first 

half of 2021, a small decline from 20 percent 

in the same period of the prior year. Of note, 

the OCEAN Alliance stopped servicing the 

Mediterranean trade in February 2021, so their 

market share in this trade will decrease.
22 60th Annual Report

Chart 2: Transatlantic Market Shares of Carriers and Alliances, First Half of 2021

Alliance Carrier Capacity

Together the carriers in these global alliances operate several services that encompass 

the major east-west trade lanes, including the 

transpacific, transatlantic, and Asia-Europe 

trades. At the end of FY 2021, the 2M Alliance 

accounted for approximately 33 percent of all 

global container capacity, including 19 percent 

of the transpacific U.S. import trade, and 19 

percent of the transpacific U.S. export trade. 

In the transatlantic, 2M has 41 percent of the 

U.S. import trade and 33 percent of the U.S. 

export trade.

THE Alliance members accounted for 19 

percent of the global container capacity in FY 

2021. THEA accounted for 25 percent of the 

transpacific U.S. import trade and 30 percent 

of the transpacific U.S. export trade. In the 

transatlantic, THEA has 28 percent of the U.S. 
60th Annual Report 23

import trade and 35 percent of the U.S. export 

trade. The OCEAN Alliance accounted for 

approximately 29 percent of all global container capacity, including 43 percent of the 

transpacific U.S. import trade and 43 percent 

of the transpacific U.S. export trade. In the 

transatlantic, the Ocean Alliance has 19 percent of the U.S. import trade and 21 percent 

of the U.S. export trade.

Over the fiscal year, supply chain challenges, including severe congestion at U.S. 

ports, resulted in a surge of cancelled sailings and inhibited the ability of the global 

alliances to expand capacity. While rapidly 

increasing demand in 2020 and 2021 incentivized carriers to substantially increase seaside 

capacity across the globe, the effectiveness 

of this seaside capacity was limited due to 

supply constraints at ports, terminals, and 

inland rail hubs across the United States.

Compared across the trade lanes in 6-month 

increments, there are two significant surges 

of blank sailings—in the first half of 2020 

and the first half of 2021. For the transpacific 

inbound trade, alliances removed 18 percent 

of adjusted capacity in both the first half of 

2020 and the first half of 2021. For the transatlantic inbound trade, the alliances increased 

their blank sailings in 2021, removing 12 

percent of adjusted capacity in the first half 

of the year, compared with 7 percent in the 

first half of 2020. Unlike in 2020 when cancelled sailings were caused by the onset of the 

COVID-19 pandemic resulting in factory and 

port closures, cancelled sailings in 2021 were 

almost entirely driven by port congestion. 

This includes reasons such as vessel sliding 

due to severe schedule delays, schedule recovery, vessel repositioning, fleet rearrangement, 

and service restructuring. During the fiscal 

year, THE Alliance collectively cancelled 238 

sailings across their transpacific and transatlantic services, followed by 124 sailings by 

the OCEAN Alliance, and 82 sailings by 2M.

As a result of increased demand, coupled 

with capacity constraints, freight rates have 

hit record-setting highs in the fiscal year. 

These significant increases in freight rates 

are reflected in carriers’ average revenues. 

For the transpacific 

inbound trade, 

since July 2020 

and continuing through 

the entire 

fiscal year, 

the average revenue 

per TEU has 

continuously 

increased. Compared to the transpacific trade, 

the increase in average revenue in the transatlantic inbound trade has occurred more 

recently, beginning its ascent in October 2020 

and rising throughout the fiscal year.

In FY 2021, 2M did not suspend any additional services or introduce any additional 

services, but the transatlantic service that was 

suspended in 2020 continued to be inactive 

through the end of FY 2021. While 2M did not 

independently announce any new services 

within the alliance, it did expand cooperation with ZIM Line during FY 2021. THEA 

launched a service connecting Asia with 

the U.S. Gulf Coast in May 2021. This service operates in conjunction with Evergreen 

Line. They removed one of their transatlantic services in August, and now operate four 

services between North Europe and the U.S., 

including one that is a U.S. flag service. The 

As a result of 

increased demand, 

coupled with capacity 

constraints, freight 

rates have hit recordsetting highs in the 

fiscal year.
24 60th Annual Report

OCEAN Alliance ceased its service between 

the U.S. and the Mediterranean in February 

2021 but did not make any other major service 

changes in FY 2021.

Tariffs/NRAs/NSAs and Service Contracts

Tariffs

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

containing rates, charges, rules, and practices 

electronically in private systems. For ease of 

public access, the Commission publishes the 

web addresses of those tariffs on its website. 

At the close of FY 2021, 7,077 tariff location 

addresses were posted. Of that number, 6,932 

tariff location addresses were for Non-VesselOperating Common Carriers (NVOCCs).

Tariff Exemptions — NRAs and 

NSAs

The Commission provides regulatory relief 

from its NVOCC rate tariff requirements by 

exempting licensed and foreign registered 

NVOCCs when using NVOCC Negotiated 

Rate Arrangements (NRAs) or NVOCC Service Arrangements (NSAs) rather than a 

published tariff. At the end of the fiscal year, 

there were a total of 4,244 licensed and 2,688 

foreign registered NVOCCs. Of this total, 

2,349 (34%) had filed a prominent notice or 

rule in their respective tariff indicating that 

they had invoked the NRA exemption as 

an alternative to rate tariff publication. The 

majority of NVOCCs that have implemented 

NRAs continue to use a combination of NRAs 

and tariff rate filings; 183 NVOCCs have opted 

to use the NRA exemption exclusively and 

do not publish tariff rates. A total of 1,624 

NVOCCs have opted to publish a tariff rule in 

their respective tariff indicating they reserve 

the right to use the NSA option as an alternative to rate tariff publication.

Service Contracts

Service contracts enable carriers and shippers to tailor transportation services and rates 

to their commercial and operational needs 

and to keep these arrangements confidential. 

While the majority of cargo volumes transported in the major U.S. liner trades move 

under service contracts as an alternative to 

tariffs, ocean carrier use of tariffs versus service contracts varies by carrier and trade lane.

The COVID-19 pandemic had a significant 

impact on the global supply chain, including 

service contract negotiation and implementation. To allow contracting parties time to adapt 

to the increased pressures from COVID-19 

and minimize disruptions to the contracting 

process, the Commission issued a temporary 

blanket exemption in FY 2020, extending the 

filing flexibilities for service contract amendments to original service contracts, and later 

extended that relief to June 1, 2021. In FY 2021, 

the FMC amended its service contract filing 

requirements to permit ocean carriers to file 

original service contracts up to 30 days after 

the contract goes into effect. This final rule 

became effective on June 2, 2021.

Of the 145 active ocean carriers in the U.S. 

trades at the end of FY 2021, 85 filed service 

contracts with the Commission during the 

fiscal year. The remaining 60 ocean carriers 
60th Annual Report 25

solely used tariffs in rating their cargo. During 

the fiscal year, the Commission received 

113,068 new service contracts and 645,014 

contract amendments, compared to 45,164 

and 779,884, respectively, in FY 2020.

International Cooperation

In-person international events and opportunities for cooperation continued to be delayed 

or postponed due to the COVID-19 pandemic. 

However, Commissioners and Commission 

staff attended several virtual meetings with 

international counterparts during FY 2021. 

Specifically, in September 2021, Chairman 

Maffei, Commissioner Dye, and Commissioner Khouri participated in the 5th Global 

Regulatory Summit with regulators from the 

European Union and the People’s Republic of 

China. During this virtual summit, they discussed the effects of the COVID-19 pandemic 

on the international ocean freight industry 

and actions taken to address these effects.

Later in September 2021, Chairman Maffei 

attended the London International Shipping 

Week, which brought together various industry stakeholders and regulators from around 

the world. While in London, Chairman Maffei 

also met with senior representatives from the 

UK Department for Transport and the Competition and Markets Authority, the International 

Maritime Organization, and the International 

Chamber of Shipping.

Competitive Impact of Ocean Carrier Alliance 

Joint Purchases of Certain Covered Services

On December 4, 2018, the LoBiondo Act was 

enacted as Public Law No. 115-282. Among 

other changes, the LoBiondo Act placed 

restrictions on cooperation between or among 

ocean carriers and MTOs, including removing 

antitrust immunity for certain activities, prohibiting certain joint procurement activities, 

restricting overlapping agreement participation, and modifying the legal standard for 

enjoining agreements to jointly procure certain covered services, including:

•  the berthing or bunkering of a vessel;

•  the loading or unloading of cargo to/

from a vessel, or to/from a point on a 

wharf or terminal;

•  the positioning, removal, or replacement of buoys related to the movement 

of the vessel; or

•  towing vessel services provided to a 

vessel.

The LoBiondo Act also amended 46 U.S.C 

§ 46106 to require that the Commission annually provide to Congress: (1) an analysis of the 

competitive impact of ocean carrier alliance 

joint purchases of the covered services mentioned above; and (2) a summary of actions, 

including corrective actions, taken by the 

Commission to promote competition.
26 60th Annual Report

Review of Agreements Under 

the LoBiondo Act/Promotion of 

Competition

Since the passage of the LoBiondo Act, 

Commission staff have identified 176 agreements containing language that could be 

considered a potential threat to competition 

under the LoBiondo Act. The FMC contacted 

the parties to these agreements and informed 

them that they would be subject to special 

reporting requirements pursuant to 46 C.F.R. 

§ 535.702(d) requiring them to submit quarterly reports on usage of joint negotiation 

authority by carrier parties for the purchase 

of covered services. In response to this request, 

49 agreements were amended by the parties to 

remove this authority. These agreement revisions reduce the likelihood of anti-competitive 

activities in contracting for terminal services.1

Forty-eight agreements retain their joint 

negotiation authority for terminal services 

as of the end of FY 2021. Forty-three of these 

agreements report that they have not used this 

authority in their negotiations for terminal 

services agreements and are now required to 

update the Commission on a quarterly basis 

on use of this authority. Two agreements have 

requested and been granted a waiver from 

reporting requirements on the grounds that 

the parties share common ownership and/or 

control. There are three agreements on file 

with the Commission that have active, jointly 

negotiated terminal services agreements (TSA) 

in effect. TSAs from two of these agreements 

were reviewed in past years, posed no competitive concerns, and did not undergo any 

1 A significant number of agreements containing joint negotiation authority for terminal services were 

terminated during this period. Terminations of agreements occur for a variety of reasons and may not be directly 

linked to the passage of the LoBiondo Act or increased oversight of joint negotiation authority.

changes in FY 2021, so were not reanalyzed. 

TSAs from THE Alliance agreement (FMC No. 

012439), however, were analyzed for potential 

anticompetitive impacts.

Analysis of Joint Purchasing 

Agreements

There are two primary competition concerns 

with respect to joint purchasing arrangements. 

First, if the parties have a significant degree of 

purchasing power in the relevant market, the 

parties may drive the price of the purchased 

services below competitive levels. Second, if 

access to service providers is limited, competing purchasers may be excluded from the 

market. This is most likely where there are 

barriers to entry that prevent new service providers from entering the purchasing market or 

that prevent expansion by existing providers.

The U.S. Department of Justice (DOJ) and 

the Federal Trade Commission (FTC) have 

jointly issued guidance on the key metrics that 

should be analyzed when market participants 

engage in joint purchasing, a case of collaboration among competitors. If joint purchases 

account for less than 35 percent of the total 

sales (or output) of the purchased services in 

the relevant upstream market, and the cost of 

the jointly purchased services account for less 

than 20 percent of the buying group’s sales 

revenue in each relevant downstream market, 

the DOJ/FTC generally would consider any 

such arrangement to fall with the safety zone. 

These two thresholds are general boundaries 

that if crossed would likely subject the group 

to increased antitrust scrutiny.
60th Annual Report 27

In the case of joint purchasing agreements 

between ocean carriers and terminal operators 

and/or stevedoring companies, the relevant 

upstream market is the market in which terminal and stevedoring services are sold by 

providers and purchased by ocean carriers. 

The relevant downstream market is the ocean 

transportation services market in which the 

buying groups compete to sell those services 

to shippers.

The above referenced terminal and stevedoring services jointly negotiated by the THE 

Alliance were reviewed to ensure conformity 

with the DOJ/FTC guidelines for joint purchasing arrangements. Safety zone threshold 

tests were conducted using data from the first 

three quarters of FY 2021 (October 2020-June 

2021). In upstream markets, combined purchases of covered services by the members of 

2 Elevated rates for container shipping have led to higher revenues for shipping lines in FY 2021. However, throughput rates have remained steady, leading to these port charges reflecting a lower share of total sales 

revenue than in prior years.

3 Federal Trade Commission and Department of Justice. (April 2000). Antitrust Guidelines for Collaborations 

Among Competitors.

the agreement were less than 35 percent for 

the relevant markets.

Turning to the second threshold test, members within THE Alliance compete on the basis 

of price with other agreement members in 

downstream ocean transportation services in 

four markets: Asia to/from the U.S. West Coast; 

Asia to/from the U.S. East and Gulf coasts; 

North Europe to/from the United States; and 

the Mediterranean to/from the United States.2

In these markets, the value of joint purchases 

was below the threshold of 20 percent of the 

parties’ total sales in the relevant markets.

In summary, THE Alliance agreement operates within the safe harbor guidelines for joint 

purchasing arrangements promulgated by the 

DOJ and FTC.3 FMC will continue to monitor and assess joint purchasing of covered 

services.
28 60th Annual Report
60th Annual Report 29

Protecting the Public

Strategic Goal 2

The FMC engages in a variety of activities 

that protect the public from unlawful, unfair, 

and deceptive practices that lead to financial harm. The Commission issues licenses 

for U.S. Ocean Transportation Intermediaries (OTIs) and registers foreign-based OTIs; 

ensures financial responsibility of all OTIs 

through bonding requirements; helps resolves 

disputes about the shipment of goods or the 

carriage of passengers; investigates and prosecutes unreasonable or unjust practices; and 

issues rulings on private party complaints 

that allege Shipping Act violations. In addition, the FMC ensures that passenger vessel 

operators maintain proper financial coverage 

to reimburse cruise passengers in the event 

their cruise is cancelled or to cover liability 

in the event of death or injury at sea.

Fact Finding Investigations

During FY 2020, the FMC authorized two 

Fact Findings, each tasked with exploring 

COVID-19 related impacts to the maritime 

industry. Fact Finding 29 focused on international ocean transportation supply chain 

dislocations and Fact Finding 30 examined 

the passenger cruise industry. These investigations both continued in FY 2021.

International Ocean Transportation Supply Chain Engagement 

(Fact Finding 29)

In March 2020, the Commission voted to 

establish Fact Finding 29: International Ocean 

Transportation Supply Chain Engagement, 

designating Commissioner Rebecca F. Dye 

as the Fact Finding Officer, and authorizing her to identify operational solutions to 

cargo delivery system challenges related to 

COVID-19.

The initial focus of Fact Finding 29 was 

addressing conditions at American ports from 

the spread of COVID to the United States in 

early 2020. Widespread closures and quarantines in China shuttered factories, which had 

an associated impact on freight flows, port 

operations, and ocean carrier service offerings. 

Import cargo volumes dropped precipitously 

and ocean carriers cut service offerings accordingly. The consequence was that domestic 

ports, particularly on the West Coast, became 

congested with import loads that were not 

being picked up for final delivery and empty 

containers waiting to be repositioned to Asia. 

Commissioner Dye used Supply Chain Innovation Teams to identify what steps could be 

taken to clear cargo that was accumulating 

at ports, especially at the Southern California gateways. It was determined that simple 

steps would make meaningful contributions 

to reducing cargo congestion on terminals, 

including shippers providing information to 

terminal operators about which shipments 

contained Personal Protective Equipment, 

which containers shippers wanted to accept 
30 60th Annual Report

and were willing to pick-up, and identifying what containers shippers were not able 

to accept. Finally, Commissioner Dye was 

engaged in working with ports and shippers to find available cargo storage locations 

for U.S. companies whose businesses were 

shutdown.

With the surge of cargo that commenced 

in July 2020, the focus of Fact Finding 29 

shifted to addressing operational impacts to 

the freight delivery system from those record 

setting volumes.

During FY 2021, the Commission issued 

a Supplemental Order in November 2020 

expanding Fact Finding 29 and authorized 

Commissioner Rebecca Dye to investigate 

ocean carriers operating in alliances and calling the Port of Long Beach, the Port of Los 

Angeles, or the Port of New York and New 

Jersey to determine if the policies and practices 

of those companies related to detention and 

demurrage, container return, and container 

availability for U.S. export cargoes violated 

46 U.S.C. § 41102(c). In February 2021, Commissioner Dye issued information demand 

orders to ocean carriers and MTOs to determine if legal obligations related to detention 

and demurrage practices were being met. The 

demand orders required carriers and MTOs 

to provide information on their policies and 

practices related to container returns and container availability for exporters. Responses 

were reviewed to inform the Commission of 

possible next steps.

Over the course of FY 2021, Commissioner 

Dye met repeatedly with senior executives 

from ocean carriers, MTOs, shippers, truckers, 

and other parties as part of her work on Fact 

Finding 29, holding more than 100 different 

meetings. These conversations yielded a set of 

eight Interim Recommendations she provided 

to the Commission in July 2021. The recommendations are aimed at minimizing barriers 

to private party enforcement of the Shipping 

Act, clarifying Commission and industry 

processes, encouraging shippers, truckers, 

and other stakeholders to assist Commission 

enforcement efforts, and bolstering the ability 

of the Office of Consumer Affairs and Dispute Resolution Services to facilitate fair and 

fast dispute resolution. They address many 

of the most common problems she identified 

through her work, and the Commission is 

moving forward with implementing the recommendations that do not require legislative 

action.

Commissioner Dye’s work on Fact Finding 29 continues in FY 2022, and it is possible 

she will have additional recommendations for 

agency action, including providing further 

details about the benefits of establishing a permanent supply chain program at the Federal 

Maritime Commission.

COVID-19 Impact on Cruise 

Industry (Fact Finding 30)

On April 30, 2020, the Commission voted 

to initiate Fact Finding 30: COVID-19 Impact 

on Cruise Industry. Commissioner Louis 

E. Sola was designated Fact Finding Officer, charged to investigate and report on the 

challenges that impacted the cruise industry 

and the ports that rely on the cruise business. 

Throughout the investigation, Commissioner 

Sola has interviewed executives with ports, 

cruise lines, and labor organizations; public 

officials at the local, state, and federal level; 

and cruise passengers.
60th Annual Report 31

Commissioner Sola’s efforts have examined 

the consequences of the cessation of cruising 

on U.S. ports, as well as on related industries. 

During the fiscal year, Commissioner Sola 

visited PortMiami, Port Everglades, and the 

Port of Galveston, and he issued an interim 

report, Economic Impact of COVID-19 on the 

Cruise Industry in the Gulf Coast. The report 

noted that the loss of income to the ports and 

port communities was significant. In the Port 

of Galveston, for example, he reported that 

more than half of the port revenue is tied to 

cruising.

By the close of the fiscal year, he published 

three other reports on the cruise industry in 

California, Hawaii, and the Pacific; U.S. Territories in the Caribbean; and the East Coast.

In addition to published reports, Commissioner Sola has provided in-person briefings 

to interested parties in the legislative and 

executive branches of government. He has 

spoken with Senators, Representatives, and 

Congressional staff serving on committees 

and in personal offices. Furthermore, he has 

provided briefings on his work to officials at 

the Secretary and Under Secretary levels of 

the U.S. Departments of Homeland Security 

and Transportation.

In July 2020, the Commission issued a 

Policy Statement on Passenger Vessel Financial Responsibility that provided limited and 

temporary relief to small passenger vessel 

operators whose operations and business have 

been disrupted by the response to COVID-19. 

That relief was in effect until April 1, 2021.

In August of 2021, the Commission issued 

a proposed rule seeking public comment on 

its proposal to amend regulations on passenger vessel financial responsibility, including 

new requirements for when cruise passengers 

should be provided refunds for cancelled or 

delayed voyages. This followed an Advanced 

Notice of Proposed Rulemaking issued in 

October 2020 seeking public comment. The 

Commission anticipates taking final action 

in FY 2022.

Licensing

There are two types of OTIs that serve as 

transportation middlemen for cargo moving in 

the U.S.-foreign oceanborne trades: Non-Vessel-Operating Common Carriers (NVOCCs) 

and Ocean Freight Forwarders (OFFs).

An NVOCC is a common carrier that holds 

itself out to the public to provide ocean transportation and issues its own house bill of 

lading or equivalent document but does not 

operate the vessel by which ocean transportation is provided.

A U.S.-based OFF arranges for transportation of cargo with a common carrier (NVOCC 

or Vessel Operator) on behalf of shippers and 

processes documents related to U.S. export 

shipments. However, an OFF does not hold 

itself out to the public to provide ocean transportation and does not issue a house bill of 

lading or equivalent shipping documents.

All NVOCCs and OFFs located in the U.S. 

must be licensed by the Commission and 

must establish financial responsibility. To 

be issued a license, an OTI must provide the 

Commission evidence of experience in OTI 

activities in the U.S., the necessary character to render services, and proof of financial 

responsibility. In FY 2021, there were 4,927 

licensed NVOCCs and OFFs that maintained 
32 60th Annual Report

financial responsibility in the form of surety 

bonds on file with the FMC, collectively in 

excess of $466 million. These funds are held 

to pay any damages arising out of a licensee’s 

ocean transportation-related activities.

Foreign-based NVOCCs that do business 

in the U.S. foreign trades are required to 

register with the Commission and to have 

financial responsibility in the form of surety 

bonds. Registrants provide basic corporate 

contact information for the company. A foreign NVOCC may choose to become licensed 

if they wish. In FY 2021, there was a dramatic 

increase in the number of foreign registered 

NVOCCs, with a total of 971 new registrations accepted by the end of the fiscal year. 

Several possibilities which may have led to 

the increase are changes in the Commission’s 

regulations, fluctuations in the market, and 

enhanced efforts by surety companies to 

increase market portfolios.

There are 2,688 foreign registered NVOCCs 

and 82 foreign licensed NVOCCs that maintained approximately $409 million in surety 

bonds on file with the FMC in FY 2021.

The Commission’s triennial renewal program ensures accurate industry information 

for FMC-licensed OTIs with an online userfriendly renewal process. In FY 2021, the FMC 

processed approximately 1,694 renewals.

The Commission has received inquiries from 

the industry regarding the People's Republic 

of China’s continued requirement for the 

Optional Rider for Additional NVOCC Financial Responsibility, and various articles have 

been published in the press indicating that 

China may be loosening its financial responsibility requirements for NVOCCs. The optional 

China bond rider originated from bilateral 

discussions between the United States and 

China and a 2003 agreement, which the Commission implemented through regulations in 

2004. It is not, and never has been, required 

by the Commission. From the Commission’s 

perspective, the bond is optional and at the 

discretion of individual NVOCCs. As of the 

end of the fiscal year, the Commission had 386 

Optional Riders on file with an approximate 

aggregated value of over $19 million.

Passenger Vessel Program

The Passenger Vessel Operator (PVO) program administered by the Commission (46 

U.S.C. §§ 44102-44103), requires evidence of 

financial responsibility for vessels which have 

berth or stateroom accommodations for 50 or 

more passengers and embark passengers at 

U.S. ports and territories. Certificates of performance cover financial responsibility used 

to reimburse passengers in the event their 

cruise is cancelled. Certificates of casualty are 

Licensing Activity in

FY 2021

• New OTI applications accepted: 391

• Amended applications accepted: 279

• New OTI licenses issued: 286

• Amended licenses issued: 94

• Licenses revoked or surrendered: 218

• New registrations accepted: 971

• Licenses renewed: 1,446

• Foreign NVO registrations renewed: 248
60th Annual Report 33

required to cover liability that may occur for 

death or injury to passengers or other persons 

on voyages to or from U.S. ports.

The PVO industry continues to be impacted 

by COVID-19, and as a result of the Commission’s Fact Finding 30 Investigation, the 

Commission issued an Advance Notice of 

Proposed Rulemaking (ANPRM) on October 

29, 2020, to obtain comments on potential 

regulatory changes recommended in the Fact 

Finding 30 Interim Report on PVO refund policies. In response to the comments received 

from the ANPRM, the Commission prepared and published a Notice of Proposed 

Rulemaking (NPRM) on August 25, 2021, to 

seek comment on defining when nonperformance of transportation has occurred and to 

establish uniform procedures regarding how 

and when passengers may make claims for 

refunds under a passenger vessel operator's 

financial responsibility instrument when nonperformance occurs. The Commission will 

review and consider public comments in early 

FY 2022.

At the close of FY 2021, 243 vessels owned 

by 49 passenger vessel operators were certified under the PVO program. The combined 

evidence of financial responsibility for nonperformance of transportation for all cruise 

vessels in the program is $801 million. Under 

the Commission’s program, there is $710 million in aggregate financial responsibility for 

casualty coverage. During the fiscal year, 4 

new performance certificates and 7 casualty 

certificates were issued.

Consumer Affairs and Dispute Resolution

The Commission, through its Office of 

Consumer Affairs and Dispute Resolution 

Services (CADRS), provides informal dispute 

resolution and mediation services to industry stakeholders to assist parties in resolving 

international ocean shipping and passenger 

cruise disputes. CADRS also gives informational assistance concerning the Commission’s 

jurisdiction and regulatory processes, as well 

as complex ocean shipping commercial matters. Overall, CADRS seeks to assist parties to 

avoid delays, risks, and additional costs that 

may result from litigation and facilitate the 

flow of U.S. foreign commerce.

The FMC was contacted by individuals 

with shipping and cruise-related complaints 

referred by the Cybersecurity and Infrastructure Security Agency, Surface Transportation 

Board, as well as other state and local consumer protection agencies such as the New 

Jersey State Attorney General, the Florida 

Department of Agriculture and Consumer 

Services, and the Miami-Dade Office of 

Consumer Affairs. Where appropriate, Commission staff also referred individuals to the 

PVO Financial Coverage in 

FY 2021

• Aggregate evidence of financial responsibility for nonperformance: $801 million

• Aggregate evidence of financial responsibility for casualty: $710 million

• New Performance Certificates issued: 4 

in FY 2021

• New Casualty Certificates issued: 7
34 60th Annual Report

Surface Transportation Board’s Rail Customer 

and Public Assistance Program for concerns 

related to railway delays and charges.

This fiscal year, the Commission closed 

a total of 239 ombuds matters: 126 relating 

to commercial cargo; 27 involving household goods; and 86 cruise matters. Also, two 

mediation matters were concluded. FMC staff 

responded to approximately 2,041 inquiries 

from the public during the fiscal year. Notably, COVID-19 pandemic continued to have a 

significant impact on the inquiries received by 

the FMC, as approximately 956 inquiries were 

a result of cruise cancellations and refund 

policies related to COVID-19.

Enforcement and Compliance

VOCC Audit Program

Congestion and bottlenecks at U.S. ports 

across the country continued to disrupt the 

U.S. supply chain during FY 2021. Accordingly, 

the FMC established the Vessel-Operating 

Common Carrier Audit Program to assess 

carrier compliance with the agency’s rule on 

detention and demurrage as well as to provide 

additional information beneficial to the regular monitoring of the marketplace for ocean 

cargo services. The audit program’s team analyzed the top nine carriers by market share 

for compliance with the Commission rule 

interpreting 46 U.S.C. § 41102(c) as it applies 

to detention and demurrage practices in the 

United States. Based on the initial information 

collected in FY 2021, and subsequent quarterly data collections, the Commission will 

work with companies to address their application of the rule and clarify any questions 

or ambiguities. Quarterly quantitative and 

qualitative information supplied by carriers 

have been, and will continue to, be used to 

establish industry best practices.

Enforcement Program

The Commission’s Bureau of Enforcement 

(BOE) is comprised of attorneys, investigative 

analysts, and the Commission’s Area Representatives (ARs). BOE strives to achieve 

industry compliance with the Shipping 

Act, as well as with other shipping statutes 

administered by the Commission, through 

investigation and prosecution of Shipping Act 

violations.

Given the U.S. supply chain issues, the 

Commission focused enforcement efforts primarily to address VOCC and MTO practices 

resulting in the assessment of possibly unjust 

or unreasonable demurrage and detention 

charges against import and export shippers 

which may have contributed to U.S. port 

congestion. ARs initiated 17 investigations 

in collaboration with BOE to identify potential 

violations of 46 U.S.C. § 41102(c) for VOCC 

failures to establish, observe, and enforce reasonable regulations and practices.

Commission staff are investigating allegations of actions, or inactions, by VOCCs calling 

at the Nation’s ports. These investigations 

may identify: (1) unreasonable demurrage 

and detention charges or terminal practices; 

(2) inability to return empty containers; (3) 
60th Annual Report 35

container imports clogging container yards; 

and (4) the scale of chassis shortages.

The Commission also authorized BOE to 

launch an inquiry into VOCC congestion 

surcharges to assess the possible adverse 

impacts these additional fees have on U.S. 

port congestion and upon cargo interests. 

BOE also investigated illegal practices in 

the transpacific, North Atlantic, Middle East, 

South American and Caribbean trades. These 

practices include VOCCs’ reliance on the definition of “merchant” in their bills of lading to 

assess demurrage and detention charges to 

entities that have no ownership interests in 

the relevant cargo nor privity of contract with 

the VOCCs. Other areas of illegal practices 

investigated were cargo misdescription and 

misdeclaration.

As of the end of FY 2021, 48 total enforcement cases were pending final resolution. In 

addition, 11 new investigative matters were 

referred to BOE for enforcement action or 

informal compromise, and 3 matters were 

administratively closed or referred for formal 

proceedings during FY 2021. The Formal 

Investigations section of this report includes 

information on formal proceedings, including 

one formal case litigated by BOE this year.

The Commission cooperates with other 

federal, state, and local transportation and 

law enforcement agencies, both through an 

established MOU which allows the FMC to 

share information and access confidential 

trade information for law enforcement purposes, and other enforcement activities. The 

FMC also collaborates and partners with other 

agencies on specific transportation-related 

policies, issues, or incidents involving U.S. 

domestic and international liner shipping.

In FY 2021, joint law enforcement activities included criminal and civil investigations 

of entities licensed or regulated by the FMC. 

Several ARs participated with the U.S. Customs and Border Protection (CBP), U.S. Coast 

Guard, and other federal agencies in annual 

Multi-Agency Strike Force Operations conducted at marine terminals at ports in New 

York and New Jersey; Oakland, CA; and Seattle, WA. The ARs aided these investigations by 

providing expert knowledge on ocean carrier 

and OTI practices, procedures, and documentation related to shipping transactions. The 

Commission and CBP also exchanged investigative information to enhance and safeguard 

the global economic competitiveness of the 

U.S., through the Department of Justice’s 

Trade Fraud Task Force.

During FY 2021, the FMC participated in a 

federal information sharing initiative regarding misdeclared cargo and received two leads 

for investigations of possible violations of the 

Shipping Act through the collaboration.

OTI Audit Program

The Commission's compliance audit program reviews the operations of NVOCCs and 

OFFs, identifies aspects of their practices that 

are noncompliant with statutory or regulatory 

requirements, and provides guidance to bring 

such regulated entities into compliance. The 

audit program also reviews companies that 

hold themselves out to be ocean carriers but 

who do not appear to conduct vessel operations. During the fiscal year, BOE opened 137 

audits and completed 131, with 6 audits pending as of September 30, 2021.
36 60th Annual Report
60th Annual Report 37

Developments in Major 

U.S. Foreign Trades

After initial declines in production and 

consumption worldwide at the outset of the 

COVD-19 pandemic in March 2020, U.S. consumer demand rebounded quickly. As shown 

in Chart 3, consumer spending shifted markedly from service to goods, with consumer 

spending on goods, particularly durable goods, 

returning to their pre-pandemic nominal level 

in June 2020. Nominal consumer spending on 

nondurable goods increased from $3 trillion 

in February 2020 to $3.1 trillion in March 2020, 

dropped to $2.7 trillion in February 2021, and 

has increased steadily for all but one month 

since that time.

Chart 3: U.S. Personal Consumption Expenditures (in billions of nominal 

dollars)

Source: U.S. Bureau of Economic Analysis

Spending on services finally returned to 

its pre-pandemic nominal levels in June 2021 

and remains below pre-pandemic levels in 

real terms.

This shift to consumer spending on goods 

led to demands on the supply chain, as items 

such as apparel, furniture, and other durables 

rely on international sources and accompanying ocean transportation. The unprecedented 

demand for imports, coupled with intermittent supply chain disruptions in 2021 due to 

continued COVD-19 outbreaks at the factories 
38 60th Annual Report

and ports in China, Vietnam, and other major 

trading partners, led to severe port congestion 

that many expect to last into calendar year 

2022.

While the U.S. Bureau of Economic Analysis 

data (Chart 3) shows more recent tempering 

in consumer spending on durable goods in 

late Summer and Fall 2021, the flattening is 

likely caused by constraints on the supply 

chain making it harder for consumers to spend 

money on certain types of goods, such as furniture and vehicles, as opposed to a shift away 

from consumer spending on goods.

Containerized Capacity

Carriers responded to the increased demand 

for ocean transportation services by expanding capacity to the extent feasible. Given the 

time lag between ship orders and delivery and 

the fact that the substantial shift in consumer 

buying had not been anticipated, the increased 

capacity has taken the form of additional ship 

charters, deferring ship repairs/dry docks, and 

realigning capacity across trade lanes.

As seen in Chart 4, roughly 6 percent of containership capacity was inactive pre-pandemic. 

This nearly doubled after the onset of the pandemic as factories and ports closed, leading to 

an increase in blank sailings. Since the reopening of factories and ports in late Spring 2020, 

the idle capacity has declined substantially, 

and has been below 2 percent from November 

2020 through the end of September 2021.

Chart 4: Inactive Capacity as a Percent of the Global Container Fleet

Source: Alphaliner
60th Annual Report 39

Additionally, although capacity on the 

Europe-North America trade lane remained 

relatively stable from January 2020 through 

September 2021, total capacity on the Far 

East-North America trade lane increased 

approximately 38 percent, from roughly 

450,000 TEU weekly capacity in January 2020 

to 620,000 TEU weekly capacity in September 

2021.

Containerized U.S. Imports and Exports

Turning from container capacity to actual 

trade numbers, it is important to note that the 

major East-West trades remain imbalanced. 

As shown in Chart 5, in the transpacific trade, 

more imports enter the U.S. from Asia than 

are exported from the U.S. to Asia. The U.S. 

also imports more goods from Europe than it 

exports to that region, although the imbalance 

in this transatlantic trade is not as strong as in 

the transpacific trade. Imports in these trades 

are also more highly valued than exports and 

move at higher rates than exports.

Chart 5: Total Monthly U.S. Containerized Imports and Exports (in TEUs)

Source: PIERS (note that September 2021 export data are preliminary)

U.S. containerized imports (across all 

trades and ports) averaged roughly 2 million 

TEUs per month pre-pandemic and has been 

roughly 2.4 million TEUs per month since 

July 2020, a sustained 20 percent increase. 

Exports, on the contrary, increased slightly in 

late 2020, showed a surge in winter and spring 

2021, and have fallen substantially through 

the summer, as congestion at major ports and 
40 60th Annual Report

lack of equipment availability has led to substantial obstacles for exporters.

The increase in imports and decrease in 

exports differs substantially by port location, presented in Table 2 as total TEUs from 

January-September for 2019, 2020, and 2021. 

While exports began strong in 2021, the eventual decline due to supply chain congestion 

and carrier prioritization of imports led to 

declines over the first three quarters of 2021 

for West Coast and Gulf Coast ports, while 

exports through East Coast ports were higher 

through September of 2021 compared to the 

same point in 2020, though slightly below 

2019 levels.

Table 2: U.S. Containerized Imports and Exports by Coast, January-September

2019 2020 2021

Total Exports 9,738,442 8,920,783 8,833,881

East Coast 4,881,812 4,439,426 4,802,061

Gulf Coast 1,343,434 1,309,299 1,120,509

West Coast 3,513,128 3,172,022 2,911,265

Total Imports 18,459,492 17,948,268 21,645,458

East Coast 8,346,629 7,976,060 9,540,617

Gulf Coast 1,383,465 1,374,957 1,707,650

West Coast 8,725,995 8,593,785 10,392,298

Source: PIERS

Note: totals include Great Lakes and other ports not present in subtotals.

While a large portion of media coverage 

on port congestion focused on import surges 

being handled by West Coast ports, the 

increase in West Coast ports U.S. imports for 

January through September of 2021 was 21 

percent higher than the first nine months of 

2020, which is comparable to the 20 percent 

increase in containerized imports moving 

through East Coast ports and lower than the 

24 percent increase at Gulf ports.
60th Annual Report 41

Commodities Imported and Exported

Tables 3 and 4 present the top 10 commodities that the U.S. exported and imported through 

East Coast and West Coast ports from January through September 2021. The commodity groups 

listed in these tables are drawn from PIERS which bases their description of goods data field on 

the Harmonized System code used by shippers.

Table 3: Top 10 U.S. Import and Export Commodities by Coast — West Coast

Exports Imports

Rank Commodity TEUs Commodity TEUs

1 Forage Products NESOI* 

(Hay, Clover, Vetches, Etc)

269,950 Furniture NESOI And Parts 

Thereof

698,131

2 Waste, Scrap Paper, Paperbd, 

NESOI

216,260 Toys Dolls 239,561

3 Waste, Scrap Unbleach Kraft, 

Corrugatd Paper/Pprbd

121,192 Wooden Furniture, NESOI 221,261

4 Brewing Or Distilling Dregs 

And Waste, W/Nt Pellet

113,281 Articles Of Plastics, NESOI 135,804

5 Soybean, Other Than Seed 109,849 Footwear, Gaiters Etc. And 

Parts Thereof

132,646

6 Cotton, Not Carded Or 

Combed

101,458 Metal Furniture NESOI 130,915

7 Ferrous Waste & Scrap 

NESOI

60,059 New Pneumatic Tires Of 

Rubber, For Motor Cars

117,300

8 Animal Feed Prep Except Dog 

Or Cat Food, Retail Pk

48,036 Art Of Beddng Ex Mattrss 

Etc, Inc Quilts, Cushions

112,952

9 Almonds, Fresh Or Dried, 

Shelled

42,751 Other Plantains 97,672

10 Copper Waste And Scrap 36,586 Tableware And Kitchenware 

Of Plastics

94,280

*Not Elsewhere Specified or Indicated (NESOI)
42 60th Annual Report

Table 4: Top 10 U.S. Import and Export Commodities by Coast — East Coast

Import Export

Rank Commodity TEUs Commodity TEUs

1 Waste, Scrap, Incl Unsorted, 

Paper, Paperbd, NESOI*

177,101 Furniture NESOI And Parts 

Thereof

522,226

2 Chem Wdpulp Sulfate Ex 

Disslvng Gr Conif, Unbleach

153,859 Other Plantains 186,954

3 Pass Veh Spk-Ig Int Com Rcpr 

P Eng >1500 Nov 3m Cc

107,425 Wooden Furniture, NESOI 172,794

4 Soybean, Other Than Seed 103,006 Toys Dolls 125,745

5 Furniture NESOI And Parts 

Thereof

102,634 New Pneumatic Tires Of 

Rubber, For Motor Cars

105,468

6 Chemical Woodpulp, Soda 

Etc. N Dis S Bl & Bl Conif

101,787 Articles Of Plastics, NESOI 98,098

7 Cotton, Not Carded Or 

Combed

101,033 Wooden Bedroom Furniture, 

Except Seats

91,226

8 Parts & Access For Motor 

Vehicles (Head 8701-8705)

99,287 Metal Furniture NESOI 81,077

9 Motor Cars & Vehicles For 

Transporting Persons

98,834 New Pneumatic Tires, Of 

Rubber

78,883

10 Coniferous Wood In The 

Rough, Not Treated

96,542 Art Of Beddng Ex Mattrss 

Etc, Inc Quilts, Cushions

71,253

*Not Elsewhere Specified or Indicated (NESOI)

The commodities in Table 3 and 4 represent those imported and exported through 

all trades, which includes the major NorthSouth trades (e.g., other plantains) rather than 

just the East-West trades with Asia which are 

characterized by more apparel. As previously 

noted and made clear by the types of commodities in these tables, exports tend to be 

heavier and lower value than imports. In particular, note that the West Coast's top exports 

are commodities such as wastepaper and scrap 

metal. The weight and value imbalance drives 

a great deal of the obstacles to U.S. exporters, 

particularly those attempting to access the 

East-West trades. High value imports, some 

of which are critical to U.S. manufacturing, 

and the higher rates commanded by imports 

put pressure on ocean carriers to move empty 

containers back to Asia as quickly as possible 

to fill with imports.

Even absent the higher rates and values for 

U.S. imports, the higher weights of exports 

mean that ships traveling from the U.S. back to 

Asia have limits on the number of full export 

containers, as the weight capacity of the ship 

is exceeded before all TEUs slots are full.
60th Annual Report 43
44 60th Annual Report

Table 5: Top 20 U.S Liner Cargo Trading Partners, Calendar Year 2020 and First 

Half of 2021

Source: PIERS

*PIERS continues to report data separately for Hong Kong due to its status as a major transshipment center.

Calendar Year 2020

Rank Country TEUs (000)

1 China (PRC) 12,295

2 Vietnam 2,400

3 South Korea 1,596

4 Taiwan (ROC) 1,344

5 India 1,208

6 Japan 1,193

7 Germany 1,045

8 Thailand 969

9 Malaysia 752

10 Brazil 724

11 Indonesia 718

12 Belgium & 

Luxembourg

698

13 Italy 686

14 Netherlands 556

15 Guatemala 501

16 Turkey 426

17 Chile 419

18 United Kingdom 408

19 Spain 385

20 Hong Kong* 345

First Half of 2021

Rank Country TEUs (000)

1 China (PRC) 6,602

2 Vietnam 1,484

3 South Korea 840

4 India 786

5 Taiwan (ROC) 709

6 Japan 634

7 Thailand 590

8 Germany 541

9 Malaysia 419

10 Indonesia 412

11 Brazil 388

12 Belgium & 

Luxembourg

374

13 Italy 374

14 Guatemala 266

15 Netherlands 261

16 Turkey 236

17 Spain 214

18 Chile 208

19 United Kingdom 197

20 Costa Rica 184
60th Annual Report 45

Top Twenty U.S. Liner Cargo 

Trading Partners

The Foreign Shipping Practices Act, 46 

U.S.C. § 306 (b)(1), requires the FMC to include 

in its annual report to Congress “a list of the 

twenty foreign countries which generated the 

largest volume of oceanborne liner cargo for 

the most recent calendar year in bilateral trade 

with the United States.”

The Commission derives its list of toptwenty trading partners from the PIERS 

database. The most recent complete calendar 

year of available data is 2020. Table 5 lists the 

twenty foreign countries that generated the 

largest volume of oceanborne liner cargo in 

the bilateral trade with the United States in 

calendar year 2020 and the first half of 2021. 

The figures in the table represent each country’s U.S. liner imports and exports combined 

in thousands of loaded TEUs.

Bilateral trade with the United States’ toptwenty liner trading partners represented 

approximately 80 percent of the Nation’s 

total liner trade over the past few years. The 

total volume of trade with our top-twenty 

liner trading partners was about the same as 

in the preceding calendar year with a slight 

two percent increase.

The top-twenty list has been comprised of 

nearly the same trading partners since 2009. 

However, in 2020, there were some changes in 

the ranking order of the countries compared 

to the preceding period. China remained the 

U.S.’s top trading partner in 2020, accounting for about 12.3 million TEUs of the total 

volume of trade and is on pace to exceed this 

in 2021. Malaysia jumped in rank from 12 to 

9. Trade with Vietnam increased 18 percent 

between 2019 and 2020 and trade with South 

Korea, Taiwan, and India edged down slightly 

year over year, but are expected to increase 

in 2021.
46 60th Annual Report
60th Annual Report 47

Foreign Shipping Practices Act

The Commission has the authority to 

address restrictive foreign shipping practices 

under section 19 of the Merchant Marine Act 

of 1920 (46 U.S.C. ch. 421) and the Foreign 

Shipping Practices Act (FSPA)(46 U.S.C. ch. 

423). Section 19 empowers the Commission to 

make rules and regulations to adjust or meet 

conditions unfavorable to shipping in the 

foreign trade of the United States. The FSPA 

directs the Commission to address adverse 

conditions that affect U.S. carriers in the foreign trade and that do not exist for foreign 

carriers in the United States.

On March 6, 2020, the Commission received 

a petition from the Lake Carriers’ Association, a trade association made up of owners 

and operators of vessels on the Great Lakes, 

alleging that conditions created by Transport Canada, an agency of the government 

of Canada, are unfavorable to shipping in the 

United States-Canada trade under section 19. 

In particular, the Lake Carriers’ Association 

asserted that Transport Canada’s proposed 

regulations requiring the installation of ballast 

water management systems on vessels loading or discharging ballast water in Canadian 

waters would drive U.S.-flag vessels from the 

cross-lakes U.S. export trade with Canada. On 

June 16, 2020, the Commission issued a Notice 

of Investigation and Request for Comments. 

The comment period closed on July 22, 2020, 

and the Commission received 21 comments, 

mostly in support of the petition.

On October 26, 2020, the Environmental Protection Agency (EPA), published a Notice of 

Proposed Rulemaking titled, Vessel Incidental 

Discharge National Standards of Performance. 

Like the proposed Canadian rule, the EPA’s 

proposed rule intends to reduce the environmental impact of vessel discharges, such as 

ballast water. Though similar in intent, the 

EPA’s proposed approach to Great Lakes ballast water does not align with the Canadian 

approach and will not have an effect on the 

U.S. Great Lakes fleet. The Notice of Proposed Rulemaking required that comments 

be received on or before November 25, 2020. 

The EPA is currently reviewing comments, 

and the final rule is not expected until 2022. 

On June 4, 2021, Transport Canada issued 

its final rule. The general approach to the regulation of Great Lakes ballast water did not 

change. However, while the effective date of 

the final rule remains 2024, the rule delayed 

implementation until 2030 for vessels built 

prior to 2009.

The Commission continues to monitor 

the situation and remains in contact with 

other federal agencies as it proceeds with its 

investigation.
48 60th Annual Report
60th Annual Report 49

Controlled Carriers

A controlled carrier is an ocean common carrier that is, or whose operating assets are, owned 

or controlled directly or indirectly by a foreign government. The Shipping Act provides that 

no controlled carrier may maintain rates or charges in its tariffs or service contracts that are 

below a level that is just and reasonable, nor may any such carrier establish, maintain, or 

enforce unjust or unreasonable classifications, rules, or regulations in those tariffs or service 

contracts. 

In addition, tariff rates, charges, classifications, rules, or regulations of a controlled carrier 

may not, without special permission of the Commission, become effective sooner than the 30th 

day after the date of publication. The Commission’s staff monitors U.S. and foreign trade press 

and other information sources to identify controlled carriers and any unjust or unreasonable 

controlled carrier activity that might require Commission action. 

As of the end of FY 2021, four controlled carriers operated in the U.S. trades. All four controlled carriers are subsidiaries of COSCO SHIPPING Holdings Co., Ltd.:

1. COSCO SHIPPING Lines Co., Ltd. – People’s Republic of China

2. Orient Overseas Container Line Limited – People’s Republic of China

3. OOCL (Europe) Limited – People’s Republic of China

4. COSCO Shipping Lines (Europe) GmbH – People’s Republic of China
50 60th Annual Report
60th Annual Report 51

Formal Investigations, Private 

Complaints, and Litigation

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

complaint, or by order of the Commission 

upon petition, or upon its own motion. Types 

of docketed proceedings include:

•  Private complaints: Any person 

may file a formal complaint alleging violations of specific sections of 

the Shipping Act found at 46 U.S.C. 

Chapter 411. Formal complaints are 

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

initial decision which is reviewed by 

the Commission.

•  Small claims complaints: For claims 

of $50,000 or less, an informal complaint may be filed. The complaint 

is handled by a settlement officer for 

resolution using informal procedures 

that do not tend to include discovery 

or motions practice.

•  Investigative proceedings: The 

Commission may investigate the 

activities of ocean common carriers, 

OTIs, MTOs, and other persons to 

ensure effective compliance with the 

statutes and regulations administered 

by the Commission. Formal orders of 

investigation and hearing are assigned 

to an ALJ for an initial decision and 

may be reviewed by the Commission.

The following summarizes the results of 

docketed proceedings concluded during FY 

2021 by the Office of the Administrative Law 

Judges and the Commission.

Formal Proceedings

Santa Fe Discount Cruise Parking, Inc. 

v. The Board of Trustees of the Galveston Wharves [Docket No. 14-06]

Complainants (parking lot operators who 

operate shuttle busses) allege that Respondents 

violated 46 U.S.C. § 41106(2) by imposing fees 

on Complainants while exempting taxis and 

limousines from the fees. The ALJ dismissed 

these claims, and the Commission affirmed 

the dismissal. Two of the complainants petitioned the United States Court of Appeals of 

the District of Columbia Circuit (D.C. Circuit) 

for review of the Commission order. The D.C. 

Circuit granted the petition, vacated the order, 

and remanded for further proceedings. The 

Commission in turn remanded the proceeding 

to the ALJ. The ALJ dismissed the claims on 

remand, and, in April 2021, the Commission 

reversed in part, vacated in part, and affirmed 

in part the Initial Decision on Remand. In 

particular, the Commission found that The 

Board of Trustees of the Galveston Wharves 

violated 46 U.S.C. § 41106(2) with respect to 

two of the complainants. The Commission 

then remanded the proceeding to the ALJ for 

further proceedings on reparations. Respondents petitioned for reconsideration of the 

Commission order, and while the petition 
52 60th Annual Report

was pending, two of the complainants and 

Respondents jointly moved for approval of a 

partial settlement. The Commission approved 

the partial settlement in September 2021. As 

of September 30, 2021, the petition for reconsideration for the remaining Complainant was 

pending before the Commission.

Crocus Investments, LLC v. Marine 

Transport Logistics, Inc. [Docket No. 

15-04]

Complainants allege that Respondents, one 

of whom is a non-vessel-operating common 

carrier, violated 46 U.S.C. §§ 40901(a) and 

41102(c) in handling three boats. Complainants specifically alleged that Respondents 

charged excessive fees to store the boats 

prior to export and negligently failed to provide promised services. The ALJ dismissed 

all claims, and the Commission affirmed the 

dismissal except for the claim regarding the 

storing or handling of one boat for a six-month 

period. On remand, the ALJ dismissed the 

remaining claim because Complainants failed 

to prove that Respondent engaged in unreasonable conduct on a normal, customary, and 

continuous basis. In August 2021, the Commission affirmed the ALJ’s decision.

MAVL Capital v. Marine Transport 

Logistics, Inc. [Docket No. 16-16]

Complainants allege that Respondents 

violated several provisions of Chapter 411 

of Title 46 by: (1) converting two automobiles and shipping them overseas without 

Complainants’ consent; and (2) interfering 

with Complainants’ arrangements to have a 

third-party ship three motorcycles overseas. 

The ALJ dismissed the claims regarding the 

motorcycles and one of the automobiles and 

stayed the claims regarding the other automobile pending appeal to the Commission. 

In October 2020, the Commission reversed 

the dismissal of the 46 U.S.C. § 41102(c) claim 

regarding the automobile and remanded that 

claim for further proceedings. The Commission affirmed the ALJ’s decision in all other 

respects. On September 29, 2021, the ALJ found 

that Respondent Marine Transport Logistics 

violated 46 U.S.C. § 41102(c) but declined to 

award reparations. As of September 30, 2021, 

the deadlines for the parties to file exceptions 

to the ALJ decision, or for the Commission to 

review the ALJ decision sua sponte, had not 

yet expired.

CMI Distribution, Inc. v. Service by 

Air, Inc. [Docket No. 17-05]

Complainant alleges that Respondents violated 46 U.S.C. §§ 40501(a), 40901(a), 41102(c), 

and 41104(a)(2)(A) by failing to maintain 

tariffs showing their rates, acting as ocean 

transportation intermediaries without a 

license, engaging in unreasonable conduct 

related to pass-through charges, and charging 

rates that were not contained in a published 

tariff. The ALJ found in Complainant’s favor 

and awarded reparations of $126,185 for the 

violation of § 41104(a)(2)(A). Both parties 

filed exceptions to the ALJ’s Initial Decision. 

Respondent argued that it was not an entity 

subject to the provisions at issue and that the 

ALJ erred in calculating reparations. Complainant also challenged the reparations award, 

asserting that the ALJ should have awarded 

additional amounts. In July 2021, the Commission affirmed in part and reversed in part 

the ALJ decision. The Commission affirmed 

the finding that Respondent violated §§ 40501, 

40901, and 41104, but reduced the reparations 
60th Annual Report 53

award. The Commission ultimately awarded 

Complainant reparations of $112,902, plus 

interest of $7,181. Complainant subsequently 

petitioned for attorney fees, and that petition 

was pending before the Commission as of 

September 30, 2021.

Toyota de Puerto Rico, Corp. v. Puerto 

Rico Ports Authority [Docket No. 

19-02]

Complainant alleged that Respondents violated 46 U.S.C. §§ 41102(c), 41104, and 41106 

in the collection of enhanced security fees on 

vehicles shipped to Puerto Rico from 2011 

to 2017 which were not subject to scanning 

under Respondent Puerto Rico Ports Authority’s cargo scanning program. After two of 

the respondents were dismissed by stipulation, the ALJ found that Respondent Puerto 

Rico Ports Authority was entitled to sovereign 

immunity for the cargo scanning program and 

dismissed the claims against it. The Commission affirmed the ALJ’s decision in July 2021.

TCW, Inc. v. Evergreen Shipping 

Agency [Docket No. 1966(I)]

Complainant filed a small claims complaint 

alleging that Respondents violated 46 U.S.C. 

§ 41102(c) by charging Complainant per diem 

fees on unreturned containers and chassis on a 

weekend and holiday when the Port of Savannah (the return location) was closed. The Small 

Claims Officer rejected Respondent’s jurisdictional arguments, found that Respondents 

violated § 41102(c), awarded Complainant 

reparations, and ordered Respondents to 

cease and desist charging per diem fees under 

certain circumstances. In February 2021, the 

Commission determined to review the Small 

Claims Officer’s decision, and the Commission 

subsequently gave the parties and any amici 

the opportunity to file supplemental briefs on 

specified issues. As of September 30, 2021, the 

matter was pending before the Commission.

Moses Damisa v. Trans Atlantic Shipping LLC [Docket No. 1967(F)]

Complainant filed a small claims complaint alleging violations of the Shipping Act 

in connection with an arrangement between 

the parties to ship Complainant’s property 

from the United States to Nigeria. Respondent 

denied the allegations and did not consent 

to the small claims procedures, so the claim 

was adjudicated as a formal proceeding under 

Subpart T of the Commission's Rules of Practice and Procedure. The parties engaged in 

mediation through the Commission’s Office 

of Consumer Affairs and Dispute Resolution 

Services. Complainant moved to dismiss the 

complaint without prejudice. Respondent 

opposed dismissal of the action without prejudice and sought an award of attorney fees and 

costs incurred in the proceeding. Complainant 

opposed Respondent’s request for attorney 

fees and costs. An Initial Decision granted 

the motion for voluntary dismissal without 

prejudice and denied Respondent’s request 

for attorney fees and costs. At the end of FY 

2021, the Commission had not determined 

whether to review the decision.

Astra Supply Chain, LLC and TDS 

Management, LLC v. Orient Star 

Transport Int’l Ltd. [Docket No. 20-19]

Complainants filed a complaint alleging 

that Respondent violated the Shipping Act. 

The Complainants filed a request for voluntary dismissal of the complaint prior to an 
54 60th Annual Report

answer being filed. The Secretary issued a 

notice of discontinuance of proceeding.

Astra Supply Chain, LLC and TDS 

Management, LLC v. B&Q Freight 

China Limited [Docket No. 20-20]

Complainants filed a complaint alleging 

that Respondent violated the Shipping Act. 

The Complainants filed a request for voluntary dismissal of the complaint prior to an 

answer being filed. The Secretary issued a 

notice of discontinuance of proceeding.

Astra Supply Chain, LLC and TDS 

Management, LLC v. Qingdao Perimeter Global Logistics Co. Ltd. and 

Premier Global Logistics LLC [Docket 

No. 20-21]

Complainants filed a complaint alleging 

that Respondents violated the Shipping Act. 

The Complainants filed a request for voluntary dismissal of the complaint prior to an 

answer being filed. The Secretary issued a 

notice of discontinuance of proceeding.

Rulemakings and Exemptions

The Commission initiated several rulemakings to update its regulations and address 

pressing issues for the shipping industry. The 

Commission also took action on three requests 

for regulatory exemptions.

Passenger Vessel Financial Responsibility [Docket No. 20-15]

On April 30, 2020, the Commission initiated 

Fact Finding No. 30 to investigate COVID-19’s 

impact on the cruise industry. As part of the 

investigation, the Fact Finding Officer issued 

an interim report on passenger vessel operator 

refund policies on July 27, 2020. The Fact Finding Officer concluded that clearer guidance is 

needed in determining whether a passenger is 

entitled to obtain a refund if a PVO cancels a 

voyage, makes a significant schedule change, 

or significantly delays a voyage. The Fact 

Finding Officer proposed that the Commission 

provide a clear interpretation of when nonperformance of transportation has occurred 

and modify the appropriate provisions of the 

Commission’s PVO regulations to make clear 

how passengers may obtain refunds under 

a PVOs’ financial responsibility instrument 

filed with the Commission. The Commission 

subsequently approved the recommendation on August 10, 2020, and voted to initiate 

a rulemaking to implement the proposed 

regulatory changes. On August 25, 2021, the 

Commission issued the proposed rule with the 

comment period closing on October 25, 2021. 

FMC received approximately 70 comments 

and staff is currently analyzing the comments 

and drafting a final rule for consideration by 

the Commission.

Update of Existing User Fees [Docket 

No. 20-18]

On November 13, 2020, the Commission 

updated its current user fees and amended the 

relevant regulations to reflect these updates. 

In this direct final rule, the Commission also 

corrected an internal citation and clarified the 

applicability of a fee in an existing regulation.
60th Annual Report 55

Service Contracts [Docket No. 20-22]

On January 19, 2021, the Commission proposed to amend its service contract filing 

requirements to permit ocean common carriers to file original service contracts up to 30 

days after the contract goes into effect. The 

Commission received 8 comments and published a final rule on April 23, 2021.

Inflation Adjustment of Civil Monetary Penalties [Docket No. 21-01]

On January 13, 2021, the Commission published this final rule to adjust for inflation the 

civil monetary penalties assessed or enforced 

by the Commission pursuant to the Federal 

Civil Penalties Inflation Adjustment Act 

Improvements Act of 2015 (2015 Act). The 2015 

Act requires that agencies adjust and publish 

their civil penalties by January 15 each year.

Carrier Automated Tariffs [Docket No. 

21-03]

On April 8, 2021, the Commission published 

an Advance Notice of Proposed Rulemaking 

(ANPRM) that identified inconsistencies in the 

manner in which different carriers are interpreting and applying certain aspects of the 

Commission’s rules. The ANPRM was issued 

to facilitate a fuller understanding of these 

issues prior to the Commission potentially 

proposing changes to its tariff regulations. 

The Commission observed that carriers are 

charging widely varying fees and imposing 

varying minimum requirements for access 

to common carrier tariffs. The Commission 

sought information regarding the impact of 

such fees and minimum requirements on 

public access to common carrier rules, rates, 

practices, and charges in published tariffs 

and whether existing fees or requirements 

are unreasonable. The Commission received 

three public comments and is considering the 

next action in this rulemaking project.

Marine Terminal Operator Schedules 

[Docket No. 21-06]

In a Notice of Proposed Rulemaking issued 

on September 22, 2021, the Commission proposed to modernize outdated requirements 

and clarify existing requirements associated 

with the filing of MTO schedules. The public 

comment period closed on November 22, 2021. 

FMC staff is currently working on a final rule 

for Commission consideration.

Internal Commission Organization 

and Delegations of Authority [Docket 

No. 21-07]

On September 10, 2021, the Commission 

issued a final rule amending its regulations 

governing the Commission’s organization and 

the delegation and redelegation of authorities. These regulatory changes also reflect the 

implementation of the Commission’s Agency 

Reform and Long-Term Workforce Plan.

Temporary Exemption from Certain Service Contract Requirements 

[Docket No. 20-06]

Responding to the impact of COVID-19 on 

commercial shipping operations, the Commission issued an order on April 27, 2020, 

that temporarily exempted carriers from the 

requirement that service contracts be filed 

with the Commission before becoming effective. Instead, carriers were required to file 

service contracts within 30 days of the effective date. The Order made the relief effective 

immediately and lasting through December 31, 

2020. The Commission noted in its Order that 
56 60th Annual Report

it might consider extending this exemption, 

as necessary, to address the continuing effects 

of the COVID–19 pandemic. In the interest of 

providing certainty and stability to supply 

chain stakeholders, the Commission extended 

this exemption until June 1, 2021, at which 

time the exemption was made permanent via 

the service contract rulemaking noted above.

Petition of K Line for a Temporary 

Exemption from Standard Tariff and 

Service Contract Filing Requirements 

[Petition No. P1-21]

K Line filed a petition with the Commission seeking an exemption from certain 

service contract filing and tariff publishing 

requirements because of a cyberattack on 

its systems. On April 9, 2021, the Commission granted the request for exemption from 

the relevant service contract filing requirements and an exemption from the relevant 

tariff publishing requirement, subject to certain conditions. Because the Commission’s 

exemption authority is limited to prospective 

relief, the Commission denied the request for 

exemption from the relevant tariff publishing 

requirements for cargo received prior to the 

date of the order. Instead, K Line may use 

other procedures provided by the Shipping 

Act that allows it to refund or waive collection 

of freight charges for these shipments due to 

failure to publish a tariff.

Petition of CMA for a Temporary 

Exemption from Standard Tariff and 

Service Contract Filing Requirements 

[Petition No. P2-20]

The CMA Group filed a petition with the 

Commission seeking an exemption from certain service contract filing and tariff publishing 

requirements because of a cyberattack on its 

systems. On October 20, 2020, the Commission 

granted the request for exemption from the 

relevant service contract filing requirements 

subject to certain conditions. The Commission also granted the request for exemption 

from the relevant tariff publishing requirements, subject to certain conditions. Because 

the Commission’s exemption authority is 

limited to prospective relief, the Commission 

denied the request for exemption from the relevant tariff publishing requirements for cargo 

received prior to the date of this order. Instead, 

the CMA Group may use other procedures 

provided by the Shipping Act that allows it to 

refund or waive collection of freight charges 

for these shipments due to failure to publish 

a tariff.
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FMC Information Technology

Technology remains an integral part of 

enabling the Federal Maritime Commission to 

fulfill its mission. Information technology (IT) 

infrastructure allows streamlined workflow 

and business functions to enhance productivity and have access to data and provides 

improved public access to FMC information. 

The FMC provides automated IT systems 

for use by the shipping public to file license 

applications, carrier and MTO agreements, 

and commercially sensitive operational data 

reviewed and used by the Commission to conduct mission-critical functions.

The FMC’s Information Technology Strategic Plan for FY 2018-2022 (IT Strategic Plan), 

aligned to the Commission’s agency-wide 

Strategic Plan, guides the FMC’s efforts to support and manage its information technology 

assets. The plan guides IT activities by setting 

performance goals, objectives, and timelines. 

The plan, being updated for alignment with 

the Commission’s 2022-2026 Strategic Plan, 

outlines how technology will be used to meet 

the Commission’s mid-term and long-term 

mission goals and objectives.

The FMC is continuing its multiyear application modernization effort. This initiative 

is transforming line-of-business applications 

into cloud-based enterprise applications. 

Through this initiative, FMC has successfully transitioned nine of the Commission’s 

13 applications. In FY 2021, the FMC completed development of two cloud-based 

applications (E-bonds and Form 1), with 

deployment expected to occur in FY 2022. 

The FMC remains committed to the overall 

modernization effort and establishing new 

requirements that will identify opportunities 

to leverage the gains to date.

Because of prior strategic IT infrastructure 

and cybersecurity investments, the FMC 

user community successfully transitioned 

to maximum telework and remote status at 

the beginning of the COVID-19 pandemic. 

The FMC’s mission was unimpeded by the 

shift. The continued reliance on distributed 

work necessitated additional investments 

in technology resources to ensure sustained 

capabilities and security of our IT infrastructure. The FMC is completing the installation 

of new network switches and routers to stay 

abreast of technology and enhance our security posture.
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Glossary

Agreement means an understanding, 

arrangement, or association, written or oral 

(including any modification, cancellation, or 

appendix) entered into by or among ocean 

common carriers and/or marine terminal operators, but does not include a maritime labor 

agreement. Various types of agreements are 

described in Appendix D to this report.

Blank sailing refers to a sailing that has 

been cancelled by the ocean carrier, which 

may mean one port is being skipped, or the 

entire string is cancelled.

Bulk cargo means cargo that is loaded and 

carried in bulk without mark or count in a 

loose unpackaged form, having homogeneous 

characteristics.

Common carrier means a person holding 

itself out to the general public to provide 

transportation by water of cargo between 

the United States and a foreign country for 

compensation that:

1. assumes responsibility for the transportation from port or point of receipt to the 

port or point of destination; and

2. utilizes, for all or part of that transportation, a vessel-operating on the high 

seas or the Great Lakes between a port 

in the United States and a port in a foreign country, except that the term does 

not include a common carrier engaged 

in ocean transportation by ferry boat, 

ocean tramp, or chemical parcel tanker 

or by a vessel when primarily engaged 

in the carriage of perishable agricultural 

commodities:

i. if the common carrier and the 

owner of those commodities are 

wholly-owned, directly or indirectly, 

by a person primarily engaged in the 

marketing and distribution of those 

commodities; and

ii. only with respect to the carriage of 

those commodities.

Consignee means the recipient of cargo 

from a shipper; the person to whom a transported commodity is to be delivered.

Container means a demountable and 

reusable freight-carrying unit designed to 

be transported by different modes of transportation and having construction, fittings, 

and fastenings able to withstand, without 

permanent distortion or additional exterior 

packaging or containment, the normal stresses 

that apply on continuous all-water and intermodal transportation. The term includes dry 

cargo, ventilated, insulated, refrigerated, flat 

rack, vehicle rack, liquid tank, and opentop containers without chassis, but does not 

include crates, boxes, or pallets.

Controlled carrier means a vessel-operating 

common carrier that is, or whose operating 

assets are, directly or indirectly owned or 

controlled by a government; ownership or 

control by a government shall be deemed to 

exist with respect to such common carrier if:

1. a majority portion of the interest in the 

common carrier is owned or controlled 

in any manner by that government, by 

an agency thereof, or by any public or 

private person controlled in any manner 

by that government, by any agency 

thereof, or by any public or private 

person controlled by that government; 

or
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2. that government has the right to appoint 

or disapprove the appointment of a 

majority of the directors, the chief operating officer or the chief executive officer 

of the common carrier.

Demurrage is the charge per container for 

the use of ground space at the marine terminal.

Detention is the charge by the ocean carrier 

for use of the container equipment. Per diem 

relates to assessorial charges beyond demurrage and detention.

Intermodal transportation means continuous through transportation involving more 

than one mode of service (e.g., ship, rail, 

motor, air), for pickup and/or delivery at a 

point beyond the area of the port at which the 

vessel calls. The term “intermodal transportation” can apply to through transportation (at 

through rates) or transportation on through 

routes using combination rates.

Marine terminal operator means a person 

engaged in the United States or a commonwealth, territory, or possession thereof, in the 

business of furnishing wharfage, dock, warehouse or other terminal facilities in connection 

with a common carrier, or in connection with 

a common carrier and a water carrier subject 

to Subchapter II of Chapter 135 of Title 49, 

United States Code. A marine terminal operator includes, but is not limited to: terminals 

owned or operated by states and their political subdivisions; railroads who perform port 

terminal services not covered by their line 

haul rates; common carriers who perform 

port terminal services; and warehousemen 

who operate port terminal facilities.

Non-vessel-operating common carrier

means a common carrier that does not operate 

the vessels by which the ocean transportation 

is provided and is a shipper in its relationship 

with an ocean common carrier.

Ocean carrier alliance agreement means 

two or more shipping lines authorized to discuss and agree on the supply of vessel capacity 

across multiple trades. Alliance agreements 

may contain other authorities such as information exchange, joint procurement of goods 

or services necessary to operate their services, 

etc. While there are currently seven global alliance agreements on file with the Commission, 

only three are jointly/collectively operating 

container services in the U.S. trades.

Ocean transportation intermediary means 

an ocean freight forwarder or a non-vesseloperating common carrier.

Ocean freight forwarder means a person 

that:

1. in the United States, dispatches shipments from the United States via a 

common carrier and books or otherwise 

arranges space for those shipments on 

behalf of shippers; and

2. processes the documentation or performs related activities incident to those 

shipments.

Port means a place at which a common carrier originates or terminates (by transshipment 

or otherwise) its actual ocean carriage of cargo 

or passengers as to any particular transportation movement.

Service Contract means a written contract, 

other than a bill of lading or receipt, between 

one or more shippers and an individual ocean 

common carrier or an agreement between or 

among ocean common carriers in which the 

shipper makes a commitment to provide a certain minimum quantity or portion of its cargo 

or freight revenue over a fixed time period, 

and the individual ocean common carrier or 
60th Annual Report 63

the agreement commits to a certain rate or rate 

schedule and a defined service level, such as 

assured space, transit time, port rotation, or 

similar service features.

Shipper means a cargo owner; the person 

for whose account the ocean transportation is 

provided; the person to whom delivery is to be 

made; a shipper's association; or an NVOCC 

that accepts responsibility for payment of all 

charges applicable under the tariff or service 

contract.

Tariff means a publication containing the 

actual rates, charges, classifications, rules, 

regulations, and practices of a common carrier or a conference of common carriers. The 

term “practices” refers to those usages, customs or modes of operation which in any way 

affect, determine, or change the transportation rates, charges, or services provided by a 

common carrier or conference and, in the case 

of conferences, must be restricted to activities 

authorized by the basic conference agreement.

Transshipment means the physical transfer of cargo from a vessel of one carrier to a 

vessel of another in the course of all-water 

or through transportation, where at least 

one of the exchanging carriers is an ocean 

common carrier subject to the Commission's 

jurisdiction.

Vessel-operating common carrier means a 

common carrier that operates, for all or part 

of its common carrier service, a vessel on the 

high seas or the Great Lakes between a port 

in the United States and a port in a foreign 

country, except that the term does not include 

a common carrier engaged in ocean transportation by ferry boat, ocean tramp, or chemical 

parcel-tanker.
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Appendices

A – FMC Organization Chart
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B – FMC Senior Officials

Chief of Staff Mary T. Hoang

Counsel to Chairman Maffei Katharine Primosch

Counsel to Commissioner Dye Robert Blair*

Counsel to Commissioner Khouri John A. Moran

Counsel to Commissioner Sola Clark Jennings

Counsel to Commissioner Bentzel John Young

General Counsel Steven Andersen

Secretary Rachel E. Dickon

Chief Administrative Law Judge Erin Wirth

Director, Office of EEO Ebony Jarrett*, Camella M. Woodham

Inspector General Jon Hatfield

Managing Director Karen V. Gregory*, Lucille Marvin

Deputy Managing Director Peter King*

CFO, Director of Enterprise Services Patrick Moore

Director, Bureau of Trade Analysis Florence A. Carr*, Kristen Monaco

Director, Bureau of Certification and Licensing Cindy Hennigan

Director, Bureau of Enforcement Benjamin K. Trogdon

Director, Office of CADRS Zoraya de la Cruz

*Departed; **Acting
60th Annual Report 67

C – Statement of Appropriations, Statement of 

Custodial Activity, and Financial Operations

Statement of Appropriations – Public Law 116-260:

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

of the Merchant Marine Act, 1936 (46 U.S.C. 307), including services as authorized by section 

3109 of title 5, United States Code; hire of passenger motor vehicles as authorized by section 

1343(b) of title 31, United States Code; and uniforms or allowances therefore, as authorized 

by sections 5901 and 5902 of title 5, United States Code, $30,300,000: Provided, That not to 

exceed $3,500 shall be for official reception and representation expenses.

Statement of Custodial Activity:

2021 ($) 2020 ($)

Fines, Penalties, and Forfeitures — 103

General Fund Proprietary Receipts (User fees) 216,490 190,950

Refunds of Proprietary Receipts (User fees) (250) (2,375)

Interest — 15

Total Custodial Collections 216,240 188,693

Financial Operations: For a detailed review of the FMC’s financial operations, including expenditures, please refer to the FMC’s Congressional Budget Reports and its 

Performance and Accountability Reports found at https://www.fmc.gov/about-the-fmc/

strategies-budgets-and-performance/.
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D – Agreement Types

The Commission categorizes ocean common carrier agreements by the types of agreements 

currently utilized by the ocean transportation industry, recognizing trends among types of 

agreement filings, and provides more refined information to users. The current categories are 

summarized below.

Space charter agreements authorize an ocean common carrier(s) to sell or exchange vessel 

space for use by another shipping line. Space charter agreements do not include the authority 

to discuss the provision of space in a trade, only the chartering of space already deployed.

Vessel sharing agreements authorize two or more shipping lines to discuss and agree on 

the supply of vessel capacity in a defined U.S. trade through the deployment of a specific 

service string or strings.

Global vessel sharing agreements/alliances authorize two or more shipping lines to discuss and agree on the supply of vessel capacity across multiple trades. Alliance agreements 

may contain other authorities such as information exchange, joint procurement of goods or 

services necessary to operate their services, etc. While there are currently seven global alliance agreements on file with the Commission, only three are jointly/collectively operating 

container services in the U.S. trades.

Vessel-operating common carrier conference agreements are distinguished from all other 

types of agreements because they authorize two or more shipping lines to collectively discuss, 

agree, and fix uniform freight rates, charges, practices, and conditions of service relating to 

the receipt, carriage, handling and/or delivery of passengers or cargo. There are currently 

no conference agreements on file that cover the movement of general commercial cargo. The 

conference agreements currently on file with the Commission only involve the transport of 

government impelled cargo.

Joint service agreements authorize two or more shipping lines to establish and operate a 

combined vessel service or joint venture that uses a distinct operating name and generally 

acts as a single shipping line independent of the shipping lines that are parties to the joint 

service agreement.

Equipment discussion agreements are agreements between shipping lines that primarily 

focus on the discussion, exchange, and transportation of containers, chassis, LASH/ SEABEE 

barges, and related equipment.

VOCC rate discussion agreements focus on any type of rate matter or charges, but unlike 

conferences, any consensus on rates among the shipping line members is non-binding on the 

members.

VOCC cooperative working agreements authorize shipping lines to establish exclusive, 

preferential, or cooperative working relationships that are subject to the Shipping Act, but 

that do not fall precisely within the parameters of any other specifically defined agreement 

category.
60th Annual Report 69

Assessment agreements, whether part of a collective bargaining agreement or negotiated 

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

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

utilized. These agreements can be between common carriers and labor organizations, or MTOs 

and labor organizations, and are effective upon filing with the Commission.

Marine terminal rate discussion agreements authorize MTOs to discuss rates and/or charges 

related to marine terminal operations.

Marine terminal facilities agreements generally refer to lease agreements between a MTO 

and the owner of the land or warehouse/facility at a port.

Marine terminal services agreements are agreements between a MTO and a shipping line 

concerning marine terminal services provided to and paid for by a shipping line. These services 

include: dockage, free time, handling, heavy lift, loading and unloading, terminal storage, 

usage, wharfage, wharf demurrage, and checking (the service of counting and checking cargo 

against the shipping documentation), and include any marine terminal facilities that may be 

provided incidentally to such marine terminal services.

Marine terminal joint venture agreements are agreements between or among two or more 

MTOs, or between one or more MTOs and one or more shipping lines, operating as a joint 

venture whereby a separate MTO is established.

MTO cooperative working agreements authorize MTOs to establish exclusive, preferential, 

or cooperative working relationships subject to the Shipping Act, but do not fall precisely 

within the parameters of any of the above specifically defined agreement categories.
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E – Agreement Review Standard

Statutory Standard and Process for Commission Review of Agreements Between or Among Ocean Common Carriers or Marine Terminal 

Operators

Review of agreements is governed by 46 U.S.C. § 41307(b), also commonly referred to as 

Section 6(g) of the Shipping Act.

46 U.S.C. § 41307 – Injunctive relief sought by the Commission

* * *

(b) REDUCTION IN COMPETITION. —

(1) ACTION BY COMMISSION.—

If, at any time after the filing or effective date of an agreement under chapter 403 of 

this title, the Commission determines that the agreement is likely, by a reduction in 

competition, to produce an unreasonable reduction in transportation service or an 

unreasonable increase in transportation cost or to substantially lessen competition in 

the purchasing of certain covered services, the Commission, after notice to the person 

filing the agreement, may bring a civil action in the United States District Court for the 

District of Columbia to enjoin the operation of the agreement. The Commission’s sole 

remedy with respect to an agreement likely to have such an effect is an action under 

this subsection.

(2) REMEDIES BY COURT.—In an action under this subsection, the court may issue—

(A) a temporary restraining order or a preliminary injunction; and

(B) a permanent injunction after a showing that the agreement is likely to have the effect 

described in paragraph (1).

(3) BURDEN OF PROOF AND THIRD PARTIES.—

In an action under this subsection, the burden of proof is on the Commission. The court 

may not allow a third party to intervene.

(4) COMPETITION FACTORS.—

In making a determination under this subsection regarding whether an agreement is 

likely to substantially lessen competition in the purchasing of certain covered services, 

the Commission may consider any relevant competition factors in affected markets, 

including, without limitation, the competitive effect of agreements other than the agreement under review.
60th Annual Report 71

The Commission’s process for review of agreements is established in 46 U.S.C. 

§§ 40301 – 40303:

• Agreements become effective 45 days after filing unless the Commission has requested 

additional information to evaluate the competitive impact of the agreement. All agreements are reviewed pursuant to the standard set forth in section 6(g) of the Shipping 

Act, 46 U.S.C. § 41307(b)(1).

• The Commission has the authority to reject a pending agreement filing if it determines the filing fails to meet the Shipping Act and Commission regulations requiring 

filed agreements to be clear and definite, or if the filing is outside the Commission’s 

jurisdiction.

• The Commission may seek to enjoin the operations of an agreement under 46 U.S.C. 

§ 41307(b), where it determines that the agreement could reduce competition resulting in unreasonable impacts to the market, or substantially lessen competition in the 

purchasing of certain covered services as defined in the Frank LoBiondo Coast Guard 

Authorization Act of 2018 (Pub. L. No. 115-282).

• Effective agreements are exempt from U.S. antitrust laws, and instead, are subject to 

Shipping Act restrictions and Commission oversight.
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F – Standard for Practices in Handling 

Property

46 U.S.C. § 41102(c), commonly referred to as Section 10(d)(1) of the Shipping 

Act

(c) PRACTICES IN HANDLING PROPERTY.—

A common carrier, marine terminal operator, or ocean transportation intermediary may 

not fail to establish, observe, and enforce just and reasonable regulations and practices 

relating to or connected with receiving, handling, storing, or delivering property.

The Commission has published interpretive rules regarding 46 U.S.C. 41102(c) to clarify 

the scope of the prohibition and provide guidance about its interpretation in the context of 

detention and demurrage charges.

46 C.F.R. § 545.4 Interpretation of Shipping Act of 1984—Unjust and unreasonable practices.

46 U.S.C. 41102(c) is interpreted to require the following elements in order to establish a 

successful claim for reparations:

(a) The respondent is an ocean common carrier, marine terminal operator, or ocean transportation intermediary;

(b) The claimed acts or omissions of the regulated entity are occurring on a normal, customary, and continuous basis;

(c) The practice or regulation relates to or is connected with receiving, handling, storing, 

or delivering property;

(d) The practice or regulation is unjust or unreasonable; and

(e) The practice or regulation is the proximate cause of the claimed loss.

46 C.F.R. § 545.5 Interpretation of Shipping Act of 1984—Unjust and unreasonable practices with respect to demurrage and detention.

(a) Purpose. The purpose of this rule is to provide guidance about how the Commission 

will interpret 46 U.S.C. 41102(c) and § 545.4(d) in the context of demurrage and detention.

(b) Applicability and scope. This rule applies to practices and regulations relating to demurrage and detention for containerized cargo. For purposes of this rule, the terms demurrage 

and detention encompass any charges, including “per diem,” assessed by ocean common carriers, marine terminal operators, or ocean transportation intermediaries (“regulated entities”) 

related to the use of marine terminal space (e.g., land) or shipping containers, not including 

freight charges.

(c) Incentive principle—(1) General. In assessing the reasonableness of demurrage and detention practices and regulations, the Commission will consider the extent to which demurrage 
60th Annual Report 73

and detention are serving their intended primary purposes as financial incentives to promote 

freight fluidity.

(2) Particular applications of incentive principle—(i) Cargo availability. The Commission 

may consider in the reasonableness analysis the extent to which demurrage practices and 

regulations relate demurrage or free time to cargo availability for retrieval.

(ii) Empty container return. Absent extenuating circumstances, practices and regulations 

that provide for imposition of detention when it does not serve its incentivizing purposes, 

such as when empty containers cannot be returned, are likely to be found unreasonable.

(iii) Notice of cargo availability. In assessing the reasonableness of demurrage practices 

and regulations, the Commission may consider whether and how regulated entities provide 

notice to cargo interests that cargo is available for retrieval. The Commission may consider 

the type of notice, to whom notice is provided, the format of notice, method of distribution 

of notice, the timing of notice, and the effect of the notice.

(iv) Government inspections. In assessing the reasonableness of demurrage and detention 

practices in the context of government inspections, the Commission may consider the extent 

to which demurrage and detention are serving their intended purposes and may also consider 

any extenuating circumstances.

(d) Demurrage and detention policies. The Commission may consider in the reasonableness 

analysis the existence, accessibility, content, and clarity of policies implementing demurrage 

and detention practices and regulations, including dispute resolution policies and practices 

and regulations regarding demurrage and detention billing. In assessing dispute resolution 

policies, the Commission may further consider the extent to which they contain information 

about points of contact, timeframes, and corroboration requirements.

(e) Transparent terminology. The Commission may consider in the reasonableness analysis 

the extent to which regulated entities have clearly defined the terms used in demurrage and 

detention practices and regulations, the accessibility of definitions, and the extent to which 

the definitions differ from how the terms are used in other contexts.

(f) Non-Preclusion. Nothing in this rule precludes the Commission from considering factors, arguments, and evidence in addition to those specifically listed in this rule.
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