FEDERAL MARITIME COMMISSION 

FY 2023 BUDGET JUSTIFICATION

March 2022
Federal Maritime Commission FY 2023 Budget Justification

Competition and Integrity for America’s Ocean Supply Chain i

Table of Contents

Mission Statement ................................................................................................................................... 1

FY 2023 Budget......................................................................................................................................... 2

Request Overview ................................................................................................................................ 2

Workforce – Salaries and Benefits................................................................................................... 2

Office Lease and Security – Washington, D.C., and Field Offices.................................................... 3

Information Technology and Cybersecurity..................................................................................... 3

Proposed Appropriation Language: Salaries and Expenses................................................................. 4

Mission Activities and Impacts for FY 2023 ............................................................................................. 5

FMC Response to Current Ocean Shipping Challenges and COVID-19 Impacts to 

the Maritime Industry .......................................................................................................................... 5

Strategic Plan Activities........................................................................................................................ 9

Strategic Goal 1. ............................................................................................................................... 9

Strategic Goal 2. ............................................................................................................................. 14

Stewardship Objective. .................................................................................................................. 18

Administration Initiatives Support and Cross-Government Actions...................................................... 19

Advancing Equity................................................................................................................................ 19

Data Accountability and Transparency .............................................................................................. 20

Records Management........................................................................................................................ 20

Updating User Fees............................................................................................................................ 21

Strengthening Federal Hiring ............................................................................................................. 21

Inspector General Request and Certification......................................................................................... 22

Appendices............................................................................................................................................. 24

Appendix A: Budget Request Detail .................................................................................................. 25

Appendix B: Organizational Chart...................................................................................................... 26

Appendix C: Summary of Strategic Goals, Objectives, and Performance Measures......................... 27
Competition and Integrity for America’s Ocean Supply Chain 1

Federal Maritime Commission FY 2023 Budget Justification

Mission Statement

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 Federal Maritime Commission (FMC or Commission) is an independent agency that regulates the 

international ocean transportation supply system (both liner carriers and ocean transportation 

intermediaries). This system is vital to the Nation’s commerce.

Congress created the FMC to administer and enforce the Shipping Act and related laws. The principal 

statutes administered by the Commission, codified at 46 U.S.C. §§ 40101-44106 and § 3503, are:

• The Shipping Act of 1984, as amended (ShippingAct);

• The Foreign Shipping Practices Act of 1988(FSPA);

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

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

• Section 834 of the Frank LoBiondo Coast Guard Authorization Act of 2018(LoBiondo Act).
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Federal Maritime Commission FY 2023 Budget Justification

FY 2023 Budget

Request Overview

The FMC requests $34,683,500 to 

accomplish its statutory 

responsibilities and to meet the 

needs of stakeholders and the 

public. This level of funding 

represents a $4.4M (14.5 percent)

increase from the FY 2021 enacted 

budget. This budget increase will 

support the Commission’s efforts to 

ameliorate the impact on the ocean 

shipping industry of unprecedented 

surges in cargo volumes and 

congestion at our Nation’s ports. 

This chart provides an overview of

the largest spending categories in the budget. More detailed information on the allocation of resources 

is provided in the appendices. As the above chart illustrates, the vast majority of the Commission’s 

budget is devoted to salaries and benefits.

Workforce – Salaries and Benefits

Full Time Positions (FTP): 164 (+36)

Full Time Equivalents (FTE): 149.5 (+29.5)

The requested funding level will enable the Commission to add the appropriate resources to create a 

lasting capability to focus on supply chain issues. The additional staffing, as compared to the FY 2021 

staffing levels, would be applied to Commission enforcement actions, efforts to preserve competition in 

the industry, initiatives focused on the supply chain that are within the authority of the Commission, as 

well as the capability to provide timely informational and dispute resolution assistance to consumers. 

Added administrative resources in the areas of human resources, information technology, and logistics

would supply necessary support to the increased staffing. The Commission is requesting a portion of the 

funding for salaries and expenses as multi-year funding to mitigate the risk of being unable to complete

hiring actions within the first year of enacted funding. This approach will provide the Commission with 

flexibility in our approach and sequencing of hiring actions. 

In FY 2021, the Commission initiated hiring actions for an additional 12 positions that were previously 

unfunded and ended FY 2021 with 120 employees onboard. The agency will continue its hiring efforts to 

reach 164 FTP and achieve the 150 FTE level supported by the budget. The Commission had an 

impactful turnover rate of 9% in FY 2021, with 11 departures. The turnovers have been primarily in highlevel and hard-to-fill positions. By FY 2023, approximately 18% of the FMC workforce will be eligible to 
Competition and Integrity for America’s Ocean Supply Chain 3

Federal Maritime Commission FY 2023 Budget Justification

retire. As the Commission implements office post re-entry policies, the number of retirement 

applications is expected to increase. The FY 2023 request allows the Commission to continue the 

practice of initiating hiring actions for retirements in advance of staff departures to facilitate the 

transfer of knowledge in key high-level or hard-to-fill positions.

The Commission’s payroll estimate includes a projected 4.6% pay raise in FY 2023 and no changes to 

retirement benefit contribution percentages. The Commission’s FY 2023 awards allocation of $258,000

for non-SES remains at a level of approximately 1.2% of non-SES salaries (payroll benefits not included).

At the outset of FY 2022, the Commission continued its maximum telework schedule for staff due to the

continuing COVID-19 pandemic. The agency evaluated how to modernize its policies and practices in 

preparation for the post-reentry work environment. In planning for the future of office operations, the 

Commission is exploring a myriad of work policies and organizational changes that would foster a hybrid 

work environment. Providing such options is necessary to remain competitive when recruiting top 

talent. During FY 2022 and 2023, the Commission will implement, evaluate, and adjust its policies, as 

necessary, to maintain a highly effective workforce.

The Commission continues to engage in succession management and projecting its future workforce 

needs. Continuous training and development in leadership competencies will prepare the next 

generation of leaders at the Commission. To that end, the Commission is offering leadership 

opportunities under the agency’s Leadership Development Program and realigning and combining 

functions across the Commission to allow for greater career development opportunities.

Office Lease and Security – Washington, D.C., and Field Offices

The FMC is located in Washington, D.C., and maintains a small field presence in regional locations. All 

FMC office spaces are leased through the General Services Administration (GSA). The FMC follows 

federal best practices to align the size of real property assets with program needs and will continue to 

evaluate its space requirements. The Commission optimizes office space use with the goal of reducing 

rental locations and costs when possible.

The Occupancy Agreement for the D.C. office space has been fully executed for a new lease beginning in 

FY 2023. The FMC will remain in its current location, receiving a rent concession in FY 2023 with annual 

lease payments commencing in FY 2024. The FY 2023 budget request includes the leasing costs of

$300,000 for several regional offices.

As the agency examines its workforce and space needs, the FMC will explore how to maximize our 

existing footprint to accommodate the increased number of positions without increasing space 

requirements. 

Information Technology and Cybersecurity

Funding at the requested level will allow the Commission to continue information technology (IT) 

modernization projects, enhancing both public-facing services and internal workflow processes. The 

FMC’s investments in its IT infrastructure, cloud tenant, and security posture have allowed it to remain 

fully operational under maximum telework flexibilities during the ongoing COVID-19 pandemic and to

meet cybersecurity requirements.
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Federal Maritime Commission FY 2023 Budget Justification

In FY 2023, the Commission will be working on the final stages of modernizing the FMC-18, Ocean 

Transportation Intermediary (OTI) License and Registration Application, the agency’s Regulated Persons 

Index (RPI), the Commission’s Electronic Reading Room, and the dockets filing system for Commission 

proceedings.

The projected costs include contractor-provided software development services to assist the 

Commission’s IT staff to modernize its mission-critical web applications, line-of-business applications, 

infrastructure, and server platforms. These crucial services also include on-site training and knowledge 

transfer, which require continued funding. During FY 2022, the Commission is assessing the progress of 

modernization initiatives to establish a new baseline for future development. This assessment will 

identify emerging business requirements requested by internal and external stakeholders, staying 

current with changes in technology, and addressing increased cybersecurity requirements for publicfacing and internal applications. This new baseline will guide activities over the next 3-5 years.

Proposed Appropriation Language: Salaries and Expenses

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

Merchant Marine Act, 1936, as amended (46 U.S.C. 46107), 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 [$34,683,500] of which $2,000,000 shall remain 

available until September 30, 2024: Provided, that not to exceed $3,500 shall be for official reception 

and representation expenses. (Proposed text derived from: Transportation, Housing and Urban 

Development, and Related Agencies Appropriations Act, 2021.)
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Federal Maritime Commission FY 2023 Budget Justification

Mission Activities and Impacts for FY 2023

The FMC regulates U.S. international ocean shipping, ensuring that the ocean transportation supply 

system is competitive and reliable, while protecting the public from unfair and deceptive practices.

Through its oversight, the FMC’s staff engages with a competitive industry that moves more than $1 

trillion in containerized exports and imports each year.

1 The FMC’s programs enforce the Shipping Act 

and related laws, resolve shipping disputes, and promote best practices in the industry. The Commission 

timely and efficiently analyzes the competitive impact of proposed vessel-operating common carrier 

(VOCC) and marine terminal operator (MTO) agreements; monitors activities under filed agreements; 

detects and addresses unreasonable increases in transportation costs or decreases in transportation 

services enabled by filed agreements; and addresses other activities prohibited by the law.

Furthermore, the FMC licenses ocean transportation intermediaries (OTIs), and ensures those entities 

possess adequate financial responsibility to provide the U.S. international ocean supply chain with 

integrity and security. The Commission also protects consumers from cruise industry nonperformance, 

such as cruise cancellations. These functions are inherent to the Commission’s role under the law.

FMC Response to Current Ocean Shipping Challenges and COVID-19 

Impacts to the Maritime Industry

Due to changes in the U.S. consumer demand behavior and other ripple effects of the COVID-19 

pandemic, the ocean shipping industry has been challenged by unprecedented surges in cargo volumes 

and supply chain congestion. The Commission is using the full extent of its authority under the law to 

address supply chain challenges, including implementing service contract filing relief, facilitating 

stakeholder discussions on supply chain challenges, implementing temporary relief for small U.S. cruise 

businesses, and increasing enforcement actions. The assistance extended to the ocean shipping industry 

during the pandemic will continue into FY 2023 and is already achieving positive results through the 

following initiatives:

The Federal Maritime Commission Vessel-Operating Common Carrier Audit Program: In July 2021, the 

Commission established a new audit program and dedicated audit team to assess Vessel-Operating 

Common Carriers’ (VOCCs) compliance with the FMC’s interpretive rule on detention and demurrage, as 

well as to address complaints from shippers and other stakeholders regarding detention and demurrage 

practices. The audit team is working with VOCC companies to clarify any questions or ambiguities 

concerning the application of the rule. Through review of quarterly quantitative and qualitative 

information from the carriers regarding their internal and external detention and demurrage practices, 

as well as details of substantive changes to their detention and demurrage tariff rules, the FMC is 

facilitating the creation of industry best practices.

1 According to the U.S. Census Bureau: Economic Indicators Division USA Trade Online. Source: U.S. Import and Export 

Merchandise trade statistics, U.S. container exports and imports totaled $1,031,799,889,658 in 2020.
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Federal Maritime Commission FY 2023 Budget Justification

Investigation of Congestion Surcharges: In August 2021, the Commission issued letter demands to eight 

VOCCs seeking information on the implementation of and justification for the assessment on their 

customers of congestion surcharges. These surcharges are in addition to other charges that VOCCs have 

imposed in recent months. As the pandemic continues and new fees are created, the Commission will 

continue to analyze whether these surcharges violate the law or the Commission’sregulations.

Fact Finding 29 – International Ocean Transportation Supply Chain Engagement: Initiated by the 

Commission on March 31, 2020, this Fact Finding investigation convened supply chain innovation teams 

to address port and terminal operational challenges in the wake of the COVID-19 pandemic and 

continues to make industry recommendations as warranted. By Order issued on November 19, 2020, 

this investigation was expanded to investigate whether alliances are employing practices or regulations 

in violation of Shipping Act prohibited acts, including practices and regulations related to demurrage 

and detention, empty container return practices and regulations, and practices and regulations related 

to the carriage of U.S. exports. In February 2021, the Fact Finding Officer issued information demand 

orders to ocean carriers and marine terminal operators to determine if legal obligations related to 

detention and demurrage practices are being met. In July 2021, the Fact Finding Officer issued interim 

recommendations to the Commission aimed at minimizing barriers to private party action, clarifying 

Commission and industry processes, and encouraging stakeholders to engage the Commission in 

enforcement actions and alternative dispute resolution.

Increased Enforcement Activity: In July 2021, potential enforcement matters were separated from the 

Fact Finding 29 investigation and transferred to the FMC’s Director of Field Investigations and the

Bureau of Enforcement (BOE). Since that time, the BOE and the Director of Field Investigations have 

opened 35 cases investigating port congestion and detention and demurrage charges. The subjects of 

these investigations are MTOs in major US ports, and several of the largest VOCCs. The issues being 

investigated include changes to earliest return dates for exports; charges assessed during customs holds 

for imports; terminal area closures; lack of available appointments; lack of container return locations; 

delayed container release; and container availability. The Commission also issued a Notice of Inquiry 

into the use of merchant clauses in VOCCs’ bills of lading to require payment from entities that are not 

in contractual privity with the VOCC. Attention to the collection of demurrage and detention is of 

particular concern.

Public Assistance and Informal Dispute Resolution: The Commission is revitalizing the Office of 

Consumer Affairs and Dispute Resolution Services to provide informational assistance and to facilitate 

prompt and fair informal dispute resolution to FMC stakeholders. To that end, in FY 2022, the 

Commission designated an Export Expert on the CADRS staff, per a Fact Finding 29 recommendation. In 

FY 2023, the agency seeks to significantly increase CADRS staffing to bolster its services to the public as 

an accessible and effective resource for resolving commercial conflicts that might otherwise be 

submitted to the Commission for costly litigation. In FY 2021, CADRS responded to a total of 2,041 

inquiries from the public. Of that total, 239 ombuds matters were handled: 126 relating to commercial 

cargo; 27 involving household goods; and 86 cruise matters. In FY 2023, with the dedicated resources 

requested, this program will be better equipped to quickly respond to both inquiries and disputes. 
Competition and Integrity for America’s Ocean Supply Chain 7

Federal Maritime Commission FY 2023 Budget Justification

Policy Actions: 

Statement on Retaliation and Other Obstacles to Private Party Complaints: At the suggestion of 

Interim Recommendations from Fact Finding 29, the Commission issued a policy statement to set forth 

the Commission’s position on potential retaliation, awarding of attorney fees in Commission cases, and 

representational complaints filed by associations on behalf of their members. This policy statement

clarifies some uncertainties that might be inhibiting private parties from filing cases before the 

Commission. 

Detention and Demurrage Billing Requirements: At the suggestion of Interim Recommendations from 

Fact Finding 29, the Commission issued an advance notice of proposed rulemaking (ANPRM) to solicit 

public comments on detention and demurrage billing requirements, including certain minimum 

information common carriers or marine terminal operators should be required to include in billings and 

whether common carriers should be required to adhere to certain practices regarding billing timing.

Maritime Transportation Data Initiative: In December of 2021, the Commission initiated a program to 

identify data constraints that impede the flow of ocean cargo and add to supply chain inefficiencies. The 

project aims to establish data standards and best practices for data access and transmission essential 

for a reliable and stable ocean transportation system. A series of meetings with maritime and 

intermodal stakeholders, as well as a data summit during FY 2022, will inform the Commission on the 

current need and solutions for improvements in data transparency to create greater efficiency in the 

movement of cargo.

Increased Monitoring of Ocean Carrier Alliances: The FMC monitors key economic indicators and 

changes to underlying market conditions for all global alliance agreements to detect any joint activity by 

agreement members that might raise and maintain freight rates above competitive levels, or 

unreasonably decrease services. In November 2020, due to the prolonged congestion challenges, the 

Commission increased the frequency of trade data filings by ocean carrier alliances from quarterly to 

monthly.

Providing Industry Regulatory Relief: Effective June 2, 2021, a new rule amended existing FMC 

regulations to enable ocean carriers to file original service contracts with the Commission up to 30 days 

after they go into effect. This change was prompted by positive industry response to the temporary 

service contract filing relief provided during the pandemic to minimize COVID-19-related impacts on the 

supply chain. The filing change provides regulatory requirements that reflect industry practices that

benefit both carriers and shippers. In making its decision, the Commission carefully weighed the 

regulatory burden on regulated entities and the need for the FMC to carry out its mission concerning 

statutory oversight of service contracts.

Addressing Cruise Industry Challenges: COVID-19 has also severely impacted the cruise industry. On 

March 14, 2020, the Centers for Disease Control and Prevention (CDC) issued a No Sail Order and 

Suspension of Further Embarkation causing all but the smallest Passenger Vessel Operators (PVOs) to 

cease all operations, which was extended through October 2020. Consequently, questions concerning 

future travel and passengers’ ability to obtain refunds of monies remitted for transportation disrupted 

by COVID-19 were legion. On April 30, 2020, the Commission initiated Fact Finding 30, COVID-19 Impact 

on Cruise Industry, to engage industry stakeholders, including PVOs, passengers, and MTOs, to identify 

commercial solutions to COVID-19-related issues that interfere with the operation of the cruise 

industry. On July 23, 2020, the Commission adopted the Fact Finding Officer’s proposal providing limited 
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Federal Maritime Commission FY 2023 Budget Justification

and temporary relief to small U.S. PVOs whose operations and business had been disrupted by the 

response to COVID-19. Small PVOs may now qualify for alternative forms of evidence of financial 

responsibility, provided applicants meet key conditions.

On August 10, 2020, the Commission adopted the Fact Finding Officer’s recommendation to initiate a 

rulemaking to amend its regulations concerning “non-performance” by a PVO. Accordingly, on August 

24, 2021, in Docket 20-15, the Commission issued a Notice of Proposed Rulemaking (NPRM) seeking 

public comment on a proposed rule to amend its regulations governing non-performance by passenger 

vessel operators (PVO/cruise lines) and establishing new requirements for when cruise passengers 

should be provided refunds for cancelled or delayed voyages. After careful consideration of the public 

comments submitted, on February 28, 2022, the Commission unanimously approved a final rule. 

Investigative efforts will continue during the pandemic and recovery to assist with identifying 

commercial solutions to COVID-19-related issues that interfere with the operation of the cruise 

industry. 

National Shipper Advisory Committee (NSAC): The Committee is comprised of individuals who 

represent companies importing and exporting cargo to and from the United States. The purpose of the 

Committee is to advise the FMC on policies relating to the competitiveness, reliability, integrity, and 

fairness of the international ocean freight delivery system. The Committee is responsible for identifying 

the scope of its work and for providing its advice, reports, and recommendations to the Commission. 

The inaugural meeting of the NSAC was held on October 27, 2021, and the members meet every other 

month.

Investigation into Canadian Ballast Water Regulations: 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 

of the 1920 Act. 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. In October 2020, the U.S. Environmental Protection Agency issued a proposed regulation 

that did not align with the proposed Canadian approach to ballast water. In June 2021, Transport 

Canada issued its final rule on ballast water that delayed the effective date for most of the affected U.S. 

vessels until 2030. Due to the developments within Canada and the U.S., on January 28, 2022, the 

Commission issued an additional request for comments on the submitted petition. The FMC will 

continue to monitor the situation and will review received comments. The Commission continues to 

monitor the situation and to remain in contact with other federal agencies as it proceeds with its 

investigation. This investigation is expected to continue into FY 2023. 
Competition and Integrity for America’s Ocean Supply Chain 9

Federal Maritime Commission FY 2023 Budget Justification

Strategic Plan Activities

The Commission’s FY 2022-2026 Strategic Plan provides a clear and measurable framework for 

continuous improvement in achieving the agency’s mission and addressing current and anticipated 

regulatory challenges in the ocean transportation industry. Detailed performance information can be 

found in the FMC’s annual Performance and Accountability Report on the FMC’s website at

www.fmc.gov/about-the-fmc/performance-and-accountabilty-reports/. 

Program evaluations, monitoring activities, and analyses will continue to be used to rigorously and 

credibly document program effectiveness.

The Commission’s FY 2022-2026 Strategic Plan contains two strategic goals measuring mission 

performance, and one stewardship objective for measuring the effective and efficient employment of 

allocated resources. Program evaluations, monitoring activities, and analyses will continue to be used to 

rigorously and credibly document program effectiveness.

At the requested funding level, the FMC will meet its mission, strategic goals, and stewardship 

objective.

Strategic Goal 1.

Maintain a competitive and reliable international ocean transportation 

supply system.

Through the activities under this goal, the Commission analyzes and evaluates the competitive impact of 

the shipping industry’s practices, detecting and addressing, as necessary, any unreasonable increases in 

transportation costs and/or unreasonable decreases in transportation services for the benefit of U.S. 

exporters/importers and the U.S. consumer.

Objective 1.1: Ensure no unreasonable increases in transportation costs or 

decreases in transportation service are attributed to anticompetitive practices 

under FMC-filed agreements.

The FMC ensures that the international ocean transportation supply system provides the American 

public with competitive and reliable movement of goods. In upcoming fiscal years, the FMC will 

continue its focus on competition and integrity for the United States’ ocean supply chain by:

• Analyzing and monitoring key U.S. trade lanes;

• Assessing the competitive effects of agreement parties’ activities, particularly focusing on 

issues of costs (freight rates), vessel capacity (supply), and equipment availability uponthe 

business community;

• Licensing our Nation’s OTIs, and registering foreign-based non-vessel-operating 

common carriers (NVOCCs);

• Administering an effective surety bond program to ensure payment of claims againstOTIs;
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Federal Maritime Commission FY 2023 Budget Justification

• Investigating violations of 46 U.S.C. §§ 40101-44106 ; and

• Monitoring provisions of chassis for the inland movement of containerized goods, and

the competitive effects of carrier alliance structures.

Objective 1.2: Ensure competition is preserved in the purchase of certain 

covered services (46 U.S.C. § 40102(5)) through 46 U.S.C. § 40307 authorities.

The Commission has imposed alternative periodic reporting requirements on approximately 100

agreements that contain authority for the joint procurement of covered services as defined in the 

LoBiondo Act, requiring each to file a quarterly report with the Commission, effective with the June 

2021 quarter. These reporting requirements will ensure that the Commission is aware of and can 

monitor any joint negotiation or procurement activity in a timely manner to ensure adequate 

competition for U.S. providers of these services. Additionally, in accordance with the LoBiondo Act, the 

Commission conducts an analysis and prepares an annual report to Congress on the use of these 

authorities and associated competitive impact within any of these agreements, and particularly within 

the three major ocean carrier alliance agreements.

Agreements Review: The FMC’s statutory authority and regulations require the filing of agreements 

with the Commission to ensure that the parties’ activities comply with U.S. shipping statutes and 

regulations. These agreements memorialize cooperation among VOCCs and/or MTOs. The Commission 

analyzes these agreements when they are initially filed and then monitors the agreements on an 

ongoing basis. There are approximately 375 agreements on file with the Commission, comprised of 

VOCC agreements, MTO agreements, and assessment agreements. Approximately 75 percent of these 

are VOCC agreements.

Through data provided in agreements and agreement monitoring reports, Commission staff analyze 

market conditions in key U.S. liner trades. Using this information, the Commission identifies and 

researches economic or commercial issues that may distort competition in, or impair access to, U.S. 

liner markets and tracks and assesses developments in international trade and the global economy.

Agreements filed with the FMC remain a valuable tool for VOCCs and MTOs to cooperate and achieve 

efficiencies and cost savings for U.S. shippers and ultimately, the U.S. consumer. The requested budget 

level will:

• Enable the Commission to timely review and prepare competitive analyses for bothnewly filed 

agreements and amendments to existing agreements; and

• Allow for effective management and review of multiple major agreements in the same 45-day 

review period.

Commission Analysis of Agreement Activities: The LoBiondo Act places 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:

• Berthing or bunkering of a vessel;
Competition and Integrity for America’s Ocean Supply Chain 11

Federal Maritime Commission FY 2023 Budget Justification

• Loading or unloading of cargo to/from a vessel, or to/from a point on a wharf or terminal;

• Positioning, removal, or replacement of buoys related to the movement of the vessel;or

• Towing vessel services provided to a vessel.

With respect to vessels operated by an ocean common carrier in the United States, the LoBiondo 

amendments to the Shipping Act stipulate that no group of two or more common carriers may 

negotiate for the purchase of certain covered services unless the negotiations and any resulting 

agreements are not in violation of the U.S. antitrust laws (46 U.S.C. § 41105(6)). The U.S. Department of 

Justice (DOJ) and the Federal Trade Commission (FTC) have jointly issued guidance on the appropriate 

safeguards that should be implemented when market participants engage in joint purchasing. In FYs 

2022 and 2023, the FMC will continue to monitor and report to Congress on jointly negotiated terminal 

and stevedoring services agreements to ensure conformity with the DOJ/FTC guidelines for joint 

purchasingarrangements.

Marine Terminal Operator Agreements: As referenced above, approximately 90 MTO agreements 

serving the U.S. East, Gulf, and West coasts are on file with the Commission, and monitoring of MTO 

agreements is tailored to each agreement’s specific authorities. To facilitate operations, some U.S. 

marine terminals enter into agreements on rates and/or terminal charges or cooperate in their daily 

terminal operations and related practices.

During FY 2021, the Bureau of Trade Analysis(BTA) continued a comprehensive review of the status of 

MTOs and began working with those that are no longer active in providing MTO services to remove

them from the Commission’s website. BTA also reviewed all VOCC agreements on file with the 

Commission and is in the process of ensuring that all filed agreements continue to reflect ongoing 

cooperation between agreement parties under the Shipping Act. In addition, for those MTOs that elect 

to make their MTO schedules publicly available, BTA staff verified the internet location where those

schedules are published and updated the FMC website accordingly to provide more current information

to the shipping public to inform their business decisions.

Service Contracts and Tariffs: The Commission oversees the process by which service contracts 

between shippers and VOCCs are filed with the Commission. Under service contracts, shippers make a

commitment to provide a certain volume or portion of cargo over a fixed period of time, and carriers 

commit to a specified rate and a defined service level. These confidential contracts are filed with the 

Commission in its automated SERVCON system. Commission rules also permit NVOCCs to enter into 

NVOCC service arrangements (NSAs) with their shipper customers, which are similar to service contracts 

between VOCCs and shippers.

As mentioned earlier, to minimize COVID-19-related impacts to the Nation’s vital supply chain, the 

Commission provided temporary service contract filing relief, which was made permanent in the FMC’s 

regulations following the positive response of the industry to this relief. The resultant Final Rule in 

Docket No. 20-22 became effective on June 2, 2021, permitting ocean carriers to file original service 

contracts with the Commission up to 30 days after the contract becomes effective. Shippers and carriers 

now have more flexibility in meeting service contract filing requirements, which better reflects 

contemporary business practices. Previously, Commission regulations required the filing of initial service 

contracts with the FMC before an ocean carrier was permitted to receive and move cargo under the 

terms of that contract. This flexibility extends to original service contracts the same delayed filing relief 

previously granted for service contract amendments under Docket No. 16-05.
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Federal Maritime Commission FY 2023 Budget Justification

With respect to carrier tariffs, the FMC maintains an up-to-date electronic website listing of ocean 

carrier tariff locations for the public’s use in identifying ocean carriers’ publicly available rules and rates 

for the transportation of cargo. An ANPRM was published in April 2021 seeking public comment on 

ocean carrier application of the Commission’s regulations on tariffs. The FMC’s transportation analysts 

also research, verify, and maintain a listing of marine terminal schedule locations on the Commission’s 

website for the shipping public to inform their business decisions. In September 2021, the FMC issued 

an NPRM proposing to modernize outdated requirements and clarifying existing requirements for 

marine terminal operator schedules. This rulemaking is ongoing. 

The Commission also provides regulatory relief from its NVOCC rate tariff requirements by exempting 

licensed and foreign-registered NVOCCs when using NVOCC Negotiated Rate Arrangements (NRAs). 

NVOCCs have indicated that NRAs, which are not required to be published or filed with the Commission, 

are a less burdensome commercial pricing option than rate tariffs, which must be published. 

Consequently, NVOCCs advised that NRAs save them both time and money. The majority of NVOCCs 

which have implemented NRAs continue to use a combination of NRAs and tariff rate filings.

Commission rules also granted regulatory relief from rate tariff requirements by allowing NVOCCs to 

offer transportation services pursuant to individually negotiated, confidential service arrangements with 

customers, termed NVOCC Service Arrangements (NSAs), rather than under a published tariff. As a 

pricing option, NSAs are more commonly offered by larger volume NVOCCs. Smaller volume NVOCCs 

tend to use NRAs and tariff rates as pricing options for their shipper customers.

The FMC regularly provides guidance to NVOCCs seeking to expand NRA offerings to their shippers or to 

introduce NRAs as a pricing option to their customers. The FMC also advises NVOCCs of the regulatory 

relief for NSA requirements and has participated in outreach efforts to facilitate the industry’s ability to 

take advantage of the NRA and NSA regulatory changes. The Commission will continue to provide such 

guidance in the upcoming fiscal years.

During FY 2021, more than 100,000 original service contracts and nearly 800,000 contract amendments 

were filed into the SERVCON system by 76 VOCCs. At the end of the fiscal year, the FMC had posted 

more than 6,500 active/current publicly available tariff locations to the agency’s website. Original 

service contract filings doubled in FY 2021, due to changes in carrier contracting practices. As more 

carriers adopt spot market or single shipment service contracts for a limited duration, original service 

contract filings are expected to increase further in FY 2022 to 110,000 and to 115,000 in FY 2023. 

Service contract amendments are expected to increase to 840,000 in FY 2022 and are expected to 

continue increasing in FY 2023.

The FMC is working to optimize the internal architecture of its SERVCON filing system for service 

contracts to ensure the search functionality keeps pace with the rapid accumulation of records in the 

system. The Commission continued to reach out to various service contract filers to encourage the use 

of web services when filing service contracts to increase efficiency, reduce costs, and eliminate frequent 

filing errors. The Commission anticipates that its workload through 2022 and 2023 will remain relatively 

steady with respect to service contracts.

The FMC’s work in this area is also impacted by the continual entry and exit of various OTIs to and from 

the market, which requires ongoing monitoring and verification by the FMC’s transportation analysts to 

ensure that an accurate listing of tariff publication locations on the Commission’s website is maintained 

and to ensure that published tariffs meet the Commission’s tariff requirements. In addition, the FMC 
Competition and Integrity for America’s Ocean Supply Chain 13

Federal Maritime Commission FY 2023 Budget Justification

has substantial responsibilities associated with monitoring VOCC tariffs for compliance and verifying 

that VOCCs continue to operate as common carriers in the U.S. waterborne foreign commerce. This 

FMC work ensures that all VOCCs and OTIs follow the requirements of the Shipping Act and that the 

rates and terms of shipping contracts are clear and unambiguous to shippers prior to tendering cargo.

International Affairs and Cooperation: The Commission’s international affairs program monitors 

foreign shipping laws and practices that may have an adverse effect on the industry and makes 

recommendations to the Commission for investigating and addressing such practices. The Commission 

has the authority to address restrictive foreign shipping practices under the 1920 Act and FSPA.

The 1920 Act provides the Commission with authority to investigate and address discriminatory 

conditions caused by laws, rules, or regulations of foreign governments or the practices of foreign vessel 

operators. If the Commission finds that such actions result in conditions unfavorable to shipping in a 

U.S.-foreign trade, then the 1920 Act provides the FMC with several remedies that include: levying fines 

on foreign vessels calling at U.S. ports, prohibiting foreign vessel calls at U.S. ports, and restricting 

cargos that may be carried between the U.S. and the foreign country.

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. Part of the FMC’s work in FY 2023 

will be to pursue potentially restrictive foreign practices, including new foreign legislation, new 

interpretations of existing legislation, and potential regulations, such as those concerning surcharges. 

The FMC will continue to participate, both formally and informally, in international agreement 

negotiations that could affect foreign-borne cargo shipments to the United States. The FMC will also 

track consumer and U.S.-flag vessel operator inquiries regarding possible foreign restrictive shipping 

practices.

The Commission continued its international outreach efforts to coordinate with foreign counterparts to

end unlawful, unfair, and deceptive practices. On September 7, 2021, the Commission participated in 

the 5th Global Maritime Regulatory Summit, hosted by the European Union (EU). The Summit is a 

biennial forum for competition officials from the U.S., the People’s Republic of China, and the European 

Union to meet and discuss their respective approaches to the common goal of ensuring continued 

competition in ocean shipping. China is scheduled to host the 6th Summit in 2023.

In addition, Chairman Maffei met with high-level British parliament members to discuss the 

international shipping market while he attended the London International Shipping Week in August 

2021. Relatedly, in November 2021, Commissioner Dye spoke at a semi-annual meeting of the 

Consultative Shipping Group, a group of 18 maritime countries in Europe, Asia, and Canada that all 

adhere to the same values and principles of open and unimpeded access to international maritime 

markets. Chairman Maffei met with Danish Ambassador Wisborg in December 2021 to discuss current 

supply chain disruptions and port congestion. The Commission will continue to meet with their 

international counterparts to discuss issues affecting ocean shipping in FY 2023. 

In order to sustain the Commission’s activities in this area and improve services, the Commission would 

dedicate additional resources to these efforts from the requested increase in personnel.
Competition and Integrity for America’s Ocean Supply Chain 14

Federal Maritime Commission FY 2023 Budget Justification

Strategic Goal 2.

Protect the public from unlawful, unfair, and deceptive ocean 

transportation practices.

This goal encompasses a broader mandate to protect the shipping public and consists of four objectives.

Objective 2.1: Identify and take action to end unlawful, unfair, and deceptive 

practices.

The Commission effectively uses both its enforcement and compliance programs to support 

investigations under 46 U.S.C. §§ 40101-44106 that identify unlawful, unfair, and deceptive practices.

Additional funding will significantly enable the Commission to take on more enforcement and 

compliance initiatives by increasing its staffing in these key areas.

Enforcement Program: The Commission’s enforcement program strives to achieve industry compliance

with the laws administered by the Commission through investigations, compliance initiatives and 

prosecutorial actions. The FMC will pursue enforcement actions against entities who employ 

unreasonable, market-distorting, fraudulent, or anticompetitive practices harmful to the industry and 

the public. 

Due to the unabating global supply chain challenges, the Commission is focusing its enforcement efforts 

on addressing VOCC and MTO practices that assess unjust or unreasonable congestion surcharges or 

demurrage and detention charges against import and export shippers. Specifically, the Commission is 

investigating actions or inactions by carriers calling at the Nation’s ports to identify a lack of 

appointments for empty returns, imports sitting in container yards creating excessive dwell times, and 

underlying reasons for the extensive chassis shortages.

Current resource levels would support the FMC in maintaining its ongoing efforts to identify and 

address potential legal violations. Additional resources would enable the Commission, through the work 

of the area representatives and BOE, to identify and address more violations or stem potential 

violations more quickly. These efforts could result in beneficial treatment of U.S. export and import 

shippers. It is anticipated that the Commission’s authorization to hire additional trial attorneys will help 

enable the BOE to prosecute the most egregious and complicated violations of the law.

The Commission is utilizing its new pre-enforcement procedures developed in FY 2019 (Direct Final Rule, 

84 FR 54037) to guide its enforcement actions in FY 2021 and FY 2022. The procedures give advance 

notice to the subject of an investigation that the BOE intends to recommend to the Commission the 

initiation of enforcement proceedings. The process also provides the subject an opportunity to submit a 

response before an enforcement action is recommended. Following the implementation of the 

Commission’s new process, seven entities have been sent Pre-Enforcement Notices. The usage of preenforcement procedures is discretionary and can be waived by the Commission. It has elected to do so 

in several recent cases.

Area Representatives: The Commission employs area representatives (ARs) who cover major U.S. ports 

where they provide coordination between the FMC, the maritime industry, and the public. ARs collect 

and analyze information of regulatory significance, assess industry conditions, explain Commission 

programs and requirements to industry stakeholders, and investigate alleged regulatory or statutory 
Competition and Integrity for America’s Ocean Supply Chain 15

Federal Maritime Commission FY 2023 Budget Justification

violations. ARs also cooperate with other federal, state, and local government agencies to coordinate 

investigative and research efforts. ARs conduct investigations using a systematic, fact-finding approach 

that requires evidence to be collected in the field through observation, surveillance, and on-site visits. 

Inter-Agency Cooperation: The FMC participates in security initiatives as they relate to U.S. ocean 

commerce, including coordination with the Committee on Foreign Investment in the U.S. (CFIUS). The 

FMC uses database systems with agencies engaged in domestic security to improve identification of 

entities providing and utilizing maritime transportation services. To facilitate these activities, the FMC 

has an ongoing Memorandum of Understanding (MOU) with the U.S. Customs and Border Protection 

(CBP), for access to CBP’s Automated Commercial Environment (ACE). The FMC also has an active InterAgency Agreement with the Census Bureau for access to the Census’ Automated Export System (AES) 

database.

These affiliations facilitate access to confidential U.S. export shipment data, helping the FMC to 

accomplish its mission. The Nation’s economic and security interests are also supported by the 

Commission’s continued partnership with the National Intellectual Property Rights Coordination Center 

(IPR Center), a U.S. Department of Homeland Security-led partnership of 25 federal and international 

agencies targeting intellectual property- and trade-related crimes. This relationship has brought about 

coordinated enforcement efforts addressing international criminal activity to provide a more efficient 

utilization of existing systems and services.

An MOU with the Department of Justice, Antitrust Division, was executed in July 2021 to increase 

cooperation and communication in each agency’s respective oversight and enforcement responsibilities 

of the ocean liner shipping industry.

Objective 2.2: Prevent public harm through licensing and financial 

responsibility requirements.

The Commission’s certification and licensing program focuses on three primary areas: OTI activities 

(licensing and registrations), OTI financial responsibility, and passenger vessel operator (cruise line) 

monitoring and certifications. These activities are fundamental to protecting the public from unqualified 

and underfunded shipping companies. At the requested funding level, the Commission will continue to 

process licensing applications and enforce bonding requirements quickly and efficiently. This supports 

vital shipping and passenger vessel/cruise line businesses, including small businesses, critical to keeping 

U.S. exports/imports moving and job growth in this sector.

OTI Licensing: Ocean transportation intermediaries are the middlemen for oceanborne cargo moving in 

the U.S.-foreign trades. Before the FMC grants licenses to OTIs, each applicant must establish that it 

employs a Qualifying Individual (QI) with the necessary character and a minimum of three years of 

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

other instrument, as mandated by the Shipping Act.

Over 7,000 OTIs are regulated by the Commission, including approximately 4,900 licensed entities based 

in the United States. In addition, more than 2,000 foreign-based NVOCCs are registered with the 

Commission. The Commission continues to streamline its OTI licensing process, reducing time to process 

applications and render a decision, supporting the Commission’s goal of completing 75 percent of all 

OTI license applications within 60 days. At its current funding level in FY 2021, the Commission 
Competition and Integrity for America’s Ocean Supply Chain 16

Federal Maritime Commission FY 2023 Budget Justification

exceeded its 75 percent target, completing 85 percent of all OTI license applications within 60 days for 

the fourth year in a row. More than 650 new and amended OTI applications were received during the 

fiscal year, and of those, approximately 75 percent were accepted and processed for formal 

determination of approval. The remaining 25 percent were returned to the applicant due to lack of 

completeness or undetermined qualifications. These efforts directly benefit U.S. export shippers who 

rely on licensed OTIs to help get their goods to foreign markets.

The FMC’s triennial renewal program for licensed OTIs provides a user-friendly, online renewal process 

for OTIs to review and update their essential information on file with the Commission within minutes. In 

FY 2021, approximately 1,500 OTI licenses were renewed, with most reviewed and processed within 48 

hours of submission. The Commission projects that trend will continue in FY 2022 and FY 2023 and 

beyond, as approximately one-third, or about 1,600, OTIs are required to renew their licenses each 

year. These renewals enhance the enforcement of important aspects of the licensing and registration 

programs, such as maintaining an appropriate qualifying individual and verifying the business status and 

location of the OTI.

At the requested funding level, the Commission projects that the licensing and registration processes 

will continue unimpeded.

OTI Financial Responsibility: All licensed and registered OTIs must maintain proof of financial 

responsibility with the Commission. At present, this amounts to approximately $780 million in surety 

bonds to protect the shipping public. The FMC annually processes over 1,000 bond termination notices, 

1,000 OTI bond riders, and 1,000 new and replacement bonds. The Commission also receives a small 

number of bond riders and bond rider cancellations for the China trade. Failure to file and maintain 

proof of financial responsibility leads to license revocation.

Passenger Vessels: The FMC oversees a program to ensure financial responsibility for passenger vessels 

(cruise lines) that have berth or stateroom accommodations for 50 or more passengers and embark 

passengers at U.S. ports and territories. The requirement for Certificates of Performance, which provide 

financial responsibility for the indemnification of passengers for non-performance of transportation, 

prevents unscrupulous or financially vulnerable operators from serving U.S. ports. The PVO program 

includes 236 vessels and 48 passenger vessel operators, with aggregate evidence of financial 

responsibility coverage of over $750 million for non-performance and $700 million for casualty. PVO 

Certificates of Performance for passenger vessels are reissued every five years, however, during FY 

2021, no vessels were scheduled for reissuance. Through its website and the Consumer Affairs and 

Dispute Resolution Services (CADRS) office, the FMC offers information and guidance to the cruising 

public on passenger rights and obligations regarding monies paid to cruise lines that fail to perform

voyages.

In August 2020, the Commission initiated a process that may lead to amending its regulations 

concerning “non-performance” by a PVO/cruise line and under what circumstances passengers must be 

provided a refund for a cancelled or delayed voyage. The Commission accepted a recommendation 

made in Fact Finding 30 and directed staff to draft an ANPRM to solicit public comment on possible 

regulatory changes. The ANPRM was published on October 14, 2020. After considering the comments 

received, the Commission approved an NPRM that was published on August 24, 2021. Comments were 

received through October 25, 2021, and the Commission unanimously approved a final rule on February 

28, 2022. 
Competition and Integrity for America’s Ocean Supply Chain 17

Federal Maritime Commission FY 2023 Budget Justification

Objective 2.3: Enhance public awareness of agency resources, remedies, and 

regulatory requirements through education and outreach.

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

the public about its resources, remedies, and regulatory requirements. The Commission’s website offers 

brochures, how-to guides, forms and applications, reference libraries, news releases, information on 

investigations, and advice on topics such as FMC regulations, OTI licensing, household goods moves, and 

the use of alternative dispute resolution (ADR) services to assist parties with resolving cruise- and cargorelated disputes. 

In FY 2023, staff from the various operating bureaus and offices will provide presentations and 

instructional opportunities to educate consumers, regulated entities, industry trade associations and 

academic institutions regarding regulations, shipping trends, and the effective use of available FMC 

resources to resolve formal proceedings, cruise- and cargo-related disputes, service contract matters, 

and other commercial shipping disputes. These services are especially important during the challenges 

facing our Nation’s supply chain. The requested increase in personnel would enable the Commission to

greatly expand its educational outreach and public informational assistance efforts. 

Objective 2.4: Impartially and timely resolve international shipping disputes 

through alternative dispute resolution and adjudication.

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

MTOs, and OTIs.

Proceedings before the FMC: The Commission’s Administrative Law Judge (ALJ) operates independently 

under the Administrative Procedure Act, 5 U.S.C. Subchapter II, to resolve cases involving alleged 

violations of the Shipping Act and other laws within the Commission’s jurisdiction. Cases may be 

initiated either by private parties or by the Commission (represented by the BOE) to seek civil penalties 

for statutory violations. Small claims complaints, valued at up to $50,000, may be assigned to a Small 

Claims Officer for resolution. At the requested budget level, proceedings will continue expeditiously at 

the Commission in FY 2023.

Alternative Dispute Resolution: The FMC, through CADRS, offers facilitation services to the ocean 

shipping industry and shippers to resolve disputes. The Commission supports mediation and 

collaborative dispute resolution when feasible, and requires parties involved in formal Commission 

docketed proceedings to consult CADRS regarding the mediation services offered and consider whether 

the parties want to participate in a mediation conference. These conferences may be held in person or 

virtually, thus providing an option for a cost-effective process and conflict resolution in a pandemic and 

post-pandemic world. 

The Commission plans to provide additional resources for CADRS to enable the Commission to increase 

assistance to the number of industry stakeholders in need of informal dispute resolution services or for

informational assistance concerning FMC jurisdiction. It is anticipated that the Commission’s 

authorization to hire additional staff well-versed in ocean shipping industry practices will help enable 

the FMC to address supply chain congestion challenges more efficiently and effectively.
Competition and Integrity for America’s Ocean Supply Chain 18

Federal Maritime Commission FY 2023 Budget Justification

Stewardship Objective.

Advance the FMC’s performance through excellence in

organizational management.

The FMC recognizes the critical importance of providing effective, performance-oriented management 

and ensuring that all resources allocated to its mission are wisely employed. The Commission’s 

stewardship objective and sub-objectives have been created to measure agency administration in 

supporting the FMC’s mission. A portion of the personnel and resources requested in this budget would 

be necessary to maintain the Commission’s superior service standards 

Stewardship Sub-objective 1: Strengthen infrastructure and effective resource 

management.

The FMC realizes the critical importance of the administrative component of the agency in support of 

agency strategic goals, objectives, and performance measures. The following strategies addressing 

budget, planning, procurement, and IT are developed to provide an effective administrative support 

program within the FMC:

• Maintain an updated Continuity of Operations (COOP) program, which includes a COOP 

plan and Disaster Recovery plan that has training and exercises for staff and the 

emergency response team.

• Implement enterprise risk management practices, including updating the FMC’sannual 

Risk Profile and providing risk managementtraining.

• Promote economy and efficiency by detecting waste, fraud, and abuse in theagency’s

programs via auditing agency operations.

• Execute financial management policies and programs, manage agency appropriations, 

administer internal control systems for agency funds, travel and cash management,and 

coordinate with contractors who provide accounting and payrollservices.

• Use technology and IT expertise to streamline and automate the agency’s workprocesses 

and enhance the productivity and efficiency of the workforce, as well as maintain 

accessibility of the FMC’s website, applications, and resources.

• Secure FMC IT systems to protect against cybersecurity threats.

• Provide clear and timely guidance to staff regarding administrative matters,including 

procurement, personnel, and contracting issues.

• Ensure program compliance with rules and regulations regarding such areas asforms 

clearance, information collection pursuant to the Paperwork Reduction Act, 

environmental effects pursuant to the National Environmental Policy Act, small 

business impacts pursuant to the Regulatory Flexibility Act, and other federally 
Competition and Integrity for America’s Ocean Supply Chain 19

Federal Maritime Commission FY 2023 Budget Justification

required reports and submissions.

Sub-Objectives for Performance Measurement:

S.1.1 Manage risks and continue mission essential operations.

S.1.2 FMC’s financial management systems and practices demonstrate fiscal responsibility and

proper accounting.

S.1.3 Information Technology is optimized and IT systems areprotected.

S.1.4 Maintain the Commission’s cloud-based website to allow industry access to FMC resources 

and applications.

Stewardship Sub-objective 2: Foster a high performing, engaged, and diverse 

workforce where staff understand how their efforts contribute to the goals of 

the Commission.

The Commission’s ability to carry out its mission and serve its customers depends on having a welltrained, highly skilled, and flexible workforce. The FMC is committed to the principles of diversity and 

the implementation of policies and objectives to enhance the Commission’s workforce. The 

Commission’s Office of Equal Employment Opportunity, along with senior leaders and the Diversity & 

Inclusion Council, effectively carry out this commitment.

Sub-Objectives for Performance Measurement:

S.1.1 Management promotes a culture that is open, diverse, inclusive, and engaged.

S.1.2 Management promotes a results-oriented performance culture.

Administration Initiatives Support and 

Cross-Government Actions

In addition to the FMC’s Strategic Goals, the Commission’s activities highlighted in this budget request 

contribute to the Administration’s priorities and government-wide initiatives that increase efficiencies, 

improve customer service, and support transparency. The Commission will continue to meet its mission 

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

Advancing Equity

The Commission supports the Administration’s efforts to promote equity and remove barriers from 

underserved populations. As an independent agency, the Commission has voluntarily complied with 

Executive Order 13985, Advancing Racial Equity and Support for Underserved Communities Through the 

Federal Government, and OMB Memo M-21-17 by conducting equity assessments of programs and 

services directed at the public. The Commission has drafted an Equity Action Plan to be finalized in 

FY 2022. The Equity Action Plan will address its OTI licensing program and access to public information. 
Competition and Integrity for America’s Ocean Supply Chain 20

Federal Maritime Commission FY 2023 Budget Justification

It also addresses the FMC’s acquisitions and contracting work. The agency will continue to consider 

steps to serve underprivileged groups and to ensure that the FMC is accessible to the public and its 

stakeholders.

The FMC is voluntarily participating in Executive Order 14035, Diversity, Equity, Inclusion, and 

Accessibility in the Federal Workforce, geared towards cultivating a workforce that draws from our 

Nation’s full diversity and advancing equitable employment opportunities for individuals from 

underserved communities. Commission efforts are currently in the initial stages of review and 

assessment of the FMC’s current state of diversity, equity, inclusion, and accessibility (DEIA) in the 

agency’s human resources practices and workforce composition.

Data Accountability and Transparency

The FMC recognizes and supports a robust, integrated approach to using data to deliver on mission, 

serve customers, and manage resources. The FMC participates in government-wide tracking of its 

spending. The Digital Accountability and Transparency Act of 2014 (DATA Act) expanded the reporting 

requirements on federal spending and provided free public access to reliable information on federal 

spending. Reliable data allows the public to trust in the information that the government provides and 

allows federal and elected officials to use that data to make informed decisions about government 

programs and projects. It also provides assurance to the public and those with oversight functions that 

agencies and programs are accountable for the federal funds spent.

The Commission has an Interagency Agreement in place with the Bureau of the Fiscal Services (BFS) to 

meet its federal financial reporting requirements. Through this cross-service provider, the FMC obtains 

a full range of financial management and accounting services, including DATA Act reporting services. 

The FMC continues to work internally and with BFS to ensure full and accurate reporting of its federal 

spending. The Commission is modifying the accounting treatment of expenditures that are considered 

overhead items, which are items that are shared by all programs, bureaus, and offices. To date, the 

Commission allocated costs between its two programs by the ratio method of program direct costs to 

total FMC direct costs applied to the overhead costs. The Commission will no longer allocate overhead 

to the Inspector General (IG) program because the program is approximately 1.6% of the FMC total 

budget. Any benefit gained in allocating overhead to the IG program is de minimis compared to the cost 

in staff effort and added complexity in budget formulation, tracking, and reporting. This accounting 

treatment modification does not change the budget directly allocated to the IG program. This change is 

made in consultation with, and concurrence of, the Inspector General.

Records Management

Pursuant to OMB Memorandum M-19-21, Transition to Electronic Records, federal agencies must 

transition all business processes and recordkeeping to a fully electronic environment by December 31, 

2022. During FY 2021, the FMC continued to make progress in this important endeavor. Working with a 

contractor, the Commission digitized over 500,000 pages of paper records into a fully searchable 

records management system and securely disposed of paper records following scanning. The 

Commission will complete this effort by the end of the first quarter of FY 2023.
Competition and Integrity for America’s Ocean Supply Chain 21

Federal Maritime Commission FY 2023 Budget Justification

Updating User Fees

The FMC charges user fees for services as required by Section 8 of OMB Circular A-25. Agencies are 

required by the Chief Financial Officers Act of 1990 to conduct biennial reviews of fees and other 

charges that they impose, and to revise these fees and charges to cover program and administrative 

costs incurred, as necessary. The Commission completed its biennial review of user fees in FY 2021 

under Docket No. 20-18 Update of Existing User Fees, with revised charges to recover the full cost of 

services. The Commission increased some fees to reflect salary increases for FTEs assigned to certain 

fee-generating services. For some services, an increase in processing or review time accounted for all or 

part of the increase in the amount of the fees. For other services, the Commission decreased fees due 

to an overall reduced cost to provide those services or a decrease in overhead costs resulting from 

fewer FTEs employed by the Commission and fewer FTEs assigned to fee-generating activities. The FMC 

will review user fees in FY 2023.

Strengthening Federal Hiring

The Commission has encountered difficulty in attracting the requisite talent to fill vacancies for 

economists, industry analysts, and attorney advisors. On multiple occasions, there has been a need to

readvertise openings because selected candidates declined offers after initially accepting, which greatly 

increased the time to fill positions. The Commission continues to utilize recruitment incentives, when 

available, and to improve existing hiring practices, such as implementing Subject Matter Expert (SME) 

reviews to aid in referring the most highly qualified candidates to the hiring manager. This was the first 

step toward meeting the requirements outlined in Executive Order 13932, Modernizing and Reforming 

the Assessment and Hiring of Federal Job Candidates. The Commission continues to explore additional 

assessment methods and is considering the use of OPM’s automated USA Hire tool, which would allow 

the agency to implement and use a skill- and competency-based assessment that could carefully 

measure a candidate’s ability to perform the job.

The Commission continues to partner with the Surface Transportation Board (STB) to collaborate on a 

shared Equal Employment Opportunity Manager. This practice has been used since 2019 and has 

proven to be beneficial for both organizations.

To leverage talent, the Commission employed four interns through its Volunteer Service Program in 

FY 2021, which provides unpaid education-related work assignments for students, and plans to continue 

this effort in FY 2022, 2023, and beyond. While the Commission is not currently providing paid 

internships, the option may be considered in the future utilizing its established Student Pathways 

Program policy as a tool for federal hiring.
Competition and Integrity for America’s Ocean Supply Chain 22

Federal Maritime Commission FY 2023 Budget Justification

Inspector General Request and Certification

FEDERAL MARITIME COMMISSION

Washington, DC 20573

February 18, 2022

Office of Inspector General

The Inspector General Reform Act (Pub. L. 110-149) was signed by President George W. Bush on 

October 14, 2008. Section 6(f)(1) of the Inspector General Act of 1978, 5 U.S.C. app. 3, was amended to 

require certain specifications concerning Office of Inspector General (OIG) budget submissions each 

fiscal year (FY).

Each inspector general (IG) is required to transmit a budget request to the head of the establishment or 

designated Federal entity to which the IG reports specifying:

• the aggregate amount of funds requested for the operations of the OIG,

• the portion of this amount requested for OIG training, including a certification from the IG that

the amount requested satisfies all OIG training requirements for the fiscal year, and

• the portion of this amount necessary to support the Council of the Inspectors General on Integrity

and Efficiency (CIGIE).

The head of each establishment or designated Federal entity, in transmitting a proposed budget to the 

President for approval, shall include:

• an aggregate request for the OIG,

• the portion of this aggregate request for OIG training,

• the portion of this aggregate request for support of the CIGIE, and

• any comments of the affected IG with respect to the proposal.

The President shall include in each budget of the U.S. Government submitted to Congress:

• a separate statement of the budget estimate submitted by each IG,

• the amount requested by the President for each OIG,

• the amount requested by the President for training of OIGs,

• the amount requested by the President for support of the CIGIE, and

• any comments of the affected IG with respect to the proposal if the IG concludes that the budget

submitted by the President would substantially inhibit the IG from performing duties of the OIG.
Competition and Integrity for America’s Ocean Supply Chain 23

Federal Maritime Commission FY 2023 Budget Justification

Following the requirements as specified above, the Federal Maritime Commission (FMC) Inspector 

General submits the following information relating to the OIG’s requested budget for FY 2023:

• the aggregate budget request for the operations of the OIG is $543,615,

• the portion of this amount needed for OIG training is $2,500, and

• the portion of this amount needed to support the CIGIE is $2,000.

The Commission is modifying the accounting treatment of expenditures that are considered overhead items 

and will no longer allocate overhead to the Inspector General (IG) program. The IG program is less than 

1.6% of the FMC total budget, and any benefit gained in allocating overhead to the IG program is de 

minimis compared to the cost in staff effort and added complexity in budget formulation, tracking, and 

reporting. Prior to making this change, the Commission consulted and obtained concurrence from the 

Inspector General. This accounting treatment modification does not change the budget directly allocated 

to the IG program. 

I certify as the Inspector General of the FMC that the amount requested satisfies the needs of the OIG for

FY 2023, including all FMC OIG training requirements, and resources to support CIGIE.

Jon Hatfield, Inspector General

Federal Maritime Commission
Competition and Integrity for America’s Ocean Supply Chain 24

Appendices

FY 2023 Budget Request Explanatory Materials

Appendix A: Budget Request Details

Appendix B: Organizational Chart

Appendix C: Summary of Strategic Goals, Objectives, and Performance Measures

Federal Maritime Commission FY 2023 Budget Justification
Competition and Integrity for America’s Ocean Supply Chain 25

Appendix A: Budget Request Detail

Budget Request Detail

Funding Amounts in ($000)

Budget Object Class (BOC)

FY 2021

Enacted

FY 2022

Full-Year CR

FY 2023

Request

FY 2023 -

2021

%

Change

Full Time Equivalents 116.1 124.8 149.5 24.7

Full-Time Permanent 16,037 15,271 20,830 4,793 29.9%

Other Personnel Compensation 400 279 397 (3) -0.8%

Civilian Personnel Benefits 5,373 6,664 7,253 1,880 35.0%

Sub-Total Compensation & Benefits 21,810 22,214 28,480 6,670 30.6%

Travel and Transportation of Persons 198 117 117 (81) 40.9%

Transportation of Things 16 11 11 (5) -31.3%

Rental Payments to GSA 3,461 3,683 300 (3,161) -91.3%

Comm., Utilities, and Misc. Charges 252 239 541 289 114.7%

Printing and Reproduction 83 90 90 7 8.4%

Advisory and Assistance Services 1,298 1,297 1,297 (1) 0.0%

Services from Non-Fed. Sources 1,075 858 857 (218) -0.1%

Goods & Services from Fed. Sources 1,711 1,562 1,562 (149) -8.7%

Operation and Maintenance of Equip. 27 15 15 (12) -44.4%

Supplies and Materials 65 97 97 32 49.2%

Equipment 305 117 1,317 1,012 331.8%

Sub-Total Administrative Expenses 8,491 8,086 6,204 (2,287) -26.9%

Total Funding 30,300 30,300 34,684 4,384 14.47%

Operations & 

Administration (O&A) 

Program

Amount 29,746 29,722 32,140 2,418

FTE 114.1 122.8 137.0 25.0

Operations Salary & 

Benefits (Multi-Year)

Amount 0 0 2,000 2,000

FTE 0 0 10.5 10.5

Office of Inspector 

General (OIG) Program

Amount 554 578 544* (34)

FTE 2.0 2.0 2.0 0.0

Some amounts may not total due to rounding.

*The Commission, with concurrence of the OIG, will no longer include a distribution of overhead costs in the 

allocation of the budget for OIG expenses.

Federal Maritime Commission FY 2023 Budget Justification
Competition and Integrity for America’s Ocean Supply Chain 26

Federal Maritime Commission FY 2023 Budget Justification

Appendix B: Organizational Chart

The FMC is composed of five Commissioners nominated by the President and confirmed by the 

Senate, each serving a staggered five-year term. The Commission is a bipartisan body; no more 

than three members of the Commission may be of the same political party. One Commissioner, 

designated by the President, serves as Chairman, Chief Executive, and Chief Administrative Officer 

of the Commission.
Competition and Integrity for America’s Ocean Supply Chain 27

Federal Maritime Commission FY 2023 Budget Justification

Appendix C: Summary of Strategic Goals, Objectives, and Performance 

Measures

Summary of Strategic Goals, Objectives, and Performance Measures 

STRATEGIC GOAL 1: Maintain a competitive and reliable international ocean transportation supply system.

OBJECTIVE 1.1: Ensure no unreasonable increases in transportation costs or decreases in transportation service are 

attributed to anticompetitive practices under FMC-filed agreements.

Performance Measure: Percentage of newly filed vessel 

sharing agreements and amendments to agreements 

analyzed and presented to the Commission within 32 days.

Validation: This outcome goal is measured using data from 

the eAgreements electronic filing system and tracking the 

time elapsed between the agreement submission and 

review.

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

85% 85% 85% 85% 86%

FY 2022 Actual: TBD

Performance Measure: Percentage of agreement 

monitoring reports reviewed within 30 days of receipt to 

detect actionable information, including market-distorting 

behavior.

Validation: This outcome goal is measured using data 

contained in the eMonitoring system used for the electronic 

filing of agreement monitoring submissions. Performance is 

measured by comparing the file receipt date to the date that 

the filing was reviewed by staff analyst. 

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

80% 80% 80% 80% 80%

FY 2022 Actual: TBD

OBJECTIVE 1.2: Ensure competition is preserved in the purchase of certain covered services (46 U.S.C. § 40102(5)) through 

46 U.S.C. § 40307 authorities.

Performance Measure: Percentage of alternative agreement 

reports indicating joint contracting/procurement of covered 

services analyzed and escalated to regular monitoring status 

within 30 days of receipt to ensure systematic analysis of 

data for actionable information.

Validation: This outcome goal is measured using regulated 

entities’ data. Performance is measured by reviewing 

information received and identifying whether reports 

indicating covered services are moved from this system to 

the eMonitoring system within 30 days.

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

>95% >98% >98% >98% >98%

FY 2022 Actual: TBD
Competition and Integrity for America’s Ocean Supply Chain 28

Federal Maritime Commission FY 2023 Budget Justification

Summary of Strategic Goals, Objectives, and Performance Measures - Continued

STRATEGIC GOAL 2: Protect the public from unlawful, unfair, and deceptive ocean transportation practices.

OBJECTIVE 2.1: Identify and take action to end unlawful, unfair, and deceptive practices.

Performance Measure: Percentage of enforcement actions taken 

under the Shipping Act successfully resolved through compliance 

audits, judgments, settlements, compromise agreements, or 

issuance of default judgments, that are favorable to the FMC’s 

enforcement program.

Validation: This outcome goal is measured by examining 

enforcement case inventory and counting the number of cases 

resolved. 

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

77.5% 77.5% 77.5% 77.5% 77.5%

FY 2022 Actual: TBD

Performance Measure: Percentage of contacted unlicensed OTIs 

that submit license applications within one year after preenforcement contact and education from an area representative.

Validation: This outcome goal is measured by correlating prior 

fiscal year area representatives’ approved pre-enforcement case 

inventories with the current fiscal year data and notices on the 

status of Ocean Transportation Intermediary licenses. This data is 

collected and maintained by the Bureau of Certification and 

Licensing on the Regulated Persons Index and the list of FMC 

Licensed & Bonded OTIs. 

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

10% 15% 15% 20% 25%

FY 2022 Actual: TBD

OBJECTIVE 2.2: Prevent public harm through licensing and financial responsibility requirements.

Performance Measure: Percentage of decisions on completed 

OTI license applications rendered within 60 calendar days of 

receipt, facilitating lawful operation of OTIs with appropriate 

character and experience requirements.

Validation: This outcome goal is measured by comparing the 

total number of OTI applications assigned to an analyst (X) and 

the number of applications completed by an analyst on or before 

the 60th calendar day following assignment (Y) during a specific 

time period. The outcome goal is calculated as (Y / X) x 100 = %.

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

75% 75% 75% 75% 75%

FY 2022 Actual: TBD
Competition and Integrity for America’s Ocean Supply Chain 29

Federal Maritime Commission FY 2023 Budget Justification

Summary of Strategic Goals, Objectives, and Performance Measures - Continued

Performance Measure: Percentage of PVOs examined during the 

year that have the full financial coverage required by regulation to 

protect against loss from non-performance or casualty.

Validation: This outcome goal is measured by comparing 

reported financial coverage amounts against required coverage 

amounts. Operators covered by this program file semi-annual, 

monthly, and weekly unearned passenger revenue reports. This 

information is used to compare reported coverage against 

required coverage amounts.

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

95% 95% 95% 95% 95%

FY 2022 Actual: TBD

OBJECTIVE 2.3: Enhance public awareness of agency resources, remedies, and regulatory requirements through education 

and outreach.

Performance Measure: Percentage of Commission issuances, 

orders and reports available through the Commission’s website 

within 5 working days of receipt.

Validation: This outcome goal is measured by reviewing the 

workflow processes for posting documents to the Commission’s 

website docket activity logs. The date that each docket activity log 

is updated with new filings or issuances is compared to the date 

the document is filed with or issued by the Commission in a 

particular proceeding. 

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

90% 90% 92% 92% 92%

FY 2022 Actual: TBD

OBJECTIVE 2.2 (CONTINUED): Prevent public harm through licensing and financial responsibility requirements.

Performance Measure: Percentage of license renewals completed 

on or prior to the 3-year renewal deadlines to timely verify 

regulatory compliance.

Validation: The Completion Status Report, generated in the 

license renewal system, provides the total number of renewals 

completed (X) and the number of renewals completed on or 

before the renewal deadline (Y) during a specific time period. The 

outcome goal is calculated as (Y / X) x 100 = %

2022 

Target

2023 

Target 

2024 

Target

2025 

Target

2026 

Target

75% 75% 75% 75% 75%

FY 2022 Actual: TBD
Competition and Integrity for America’s Ocean Supply Chain 30

Federal Maritime Commission FY 2023 Budget Justification

Summary of Strategic Goals, Objectives, and Performance Measures - Continued

OBJECTIVE 2.4: Impartially and timely resolve international shipping disputes through alternative dispute resolution and 

adjudication.

Performance Measure: Percentage of dispute resolution 

matters closed within 6 months of request for assistance.

Validation: This outcome goal is measured using data 

maintained by the Commission on each dispute resolution 

matter opened. Cases are opened upon the request of the 

public for assistance and are subject to the normal fluctuations 

in businesses and consumers seeking help from the 

Commission. Cases are closed upon resolution, voluntary 

termination by the parties, refusal to participate or failure to 

respond by a party, or when the CADRS mediator determines 

that particular issues prevent the possibility for successful 

resolution.

2022 

Target

2023 

Target 

2024 

Target

2025 

Target

2026 

Target

67% 70% 73% 75% 80%

FY 2022 Actual: TBD

Performance Measure: Percentage of formal complaints or 

Commission-initiated orders of investigation completed within 

2 years of filing or Commission initiation.

Validation: This outcome goal is measured by using docket 

activity logs maintained by the Commission and used for docket 

management, and monthly and annual reporting purposes. 

2022 

Target

2023 

Target 

2024 

Target

2025 

Target

2026 

Target

72% 72% 72% 72% 72%

FY 2022 Actual: TBD
Competition and Integrity for America’s Ocean Supply Chain 31

Federal Maritime Commission FY 2023 Budget Justification

Summary of Stewardships Objectives and Performance Measures

Stewardship Objective: Advance the FMC’s mission through excellence in 

organizational management.

Stewardship Sub-objective 1: Strengthen infrastructure and effective resource management. 

S.1.1. Manage risks and continue mission essential operations.

Performance Measure: COOP activities, including annual 

training, notification exercises, and an annual COOP exercise 

are conducted throughout the year consistent with the FMC 

COOP Plan.

Validation: Complete and document all activities between 

July 1 and June 30. Sources include annual training materials, 

sign-in sheets/confirmation emails, and after-action reports.

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

100% 100% 100% 100% 100%

FY 2022 Actual: TBD

S.1.2. FMC’s financial management systems and practices demonstrate fiscal responsibility and proper accounting. 

Performance Measure: Achieve an unmodified (clean) 

opinion from the independent auditor on the Commission’s 

fiscal year’s end financial statements. (Data: Office of the 

Inspector General Independent Auditor’s Report) 

Validation: This outcome goal is an unmodified (clean) 

opinion by the Office of the Inspector General based on 

findings from the independent auditor’s review of the FMC’s 

annual financial statements and internal controls over 

financial reporting. Each year, the independent auditor 

reviews approximately 75 processes, documents, 

procedures, checklists, transaction types, and reports that 

are all considered as part of the overall assessment.

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

100% 100% 100% 100% 100%

FY 2022 Actual: TBD

S.1.3. Information technology is optimized and IT systems are protected.

Performance Measure: Percentage of the overall 

cybersecurity compliance with mandates that are issued.

Validation: This objective is measured through the report 

card from the Cybersecurity and Infrastructure Security 

Agency (CISA).

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

100% 100% 100% 100% 100%

FY 2022 Actual: TBD
Competition and Integrity for America’s Ocean Supply Chain 32

Federal Maritime Commission FY 2023 Budget Justification

Stewardship Sub-objective 2: Foster a high performing, engaged, and diverse workforce where staff understand how 

their efforts contribute to the goals of the Commission.

S.2.1. Management promotes a culture that is open, diverse, inclusive, and engaged.

Performance Measure: Benchmarking EEI index is above 

the average for small agencies; no more than 10% drop 

from the prior year.

Validation: Annual employee responses from the Federal 

Employee Viewpoint Survey (FEVS).

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

>-10% >-10% >-10% >-10% >-10%

FY 2022 Actual: TBD

S.2.2. Management promotes a results-oriented performance culture.

Performance Measure: Benchmarking FEVS results tied

to a results-oriented performance culture.

Validation: Annual employee responses from the FEVS. 

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

>75% >75% >75% >75% >75% 

FY 2022 Actual: TBD

Performance Measure: Percent of staff with the majority 

of (3 or more expectations per performance element) 

performance goals rated as meeting the characteristics of 

a specific, measurable, achievable, realistic, and timely

(SMART) goal. Targets are for non-SES/non-supervisory

staff. SES and supervisor targets will exceed listed staff 

targets. 

Validation: Review of performance plans each 

performance year.

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

25% >50% >98% >99% >99%

FY 2022 Actual: TBD

Summary of Stewardship Objectives and Performance Measures - Continued

Stewardship Sub-objective 1 (continued): Strengthen infrastructure and effective resource management. 

S.1.4. Maintain the Commission’s cloud-based website to allow industry access to FMC resources and applications. 

Performance Measure: FMC website uptime percentage.

Validation: This objective is measured through the 

Commission’s Azure server uptime report.

2022 

Target

2023 

Target

2024 

Target

2025 

Target

2026 

Target

99.5% 99.5% 99.5% 99.5% 99.5%

FY 2022 Actual: TBD
Competition and Integrity for America’s Ocean Supply Chain 33

800 N Capitol St., NW, Washington, D.C. 20573