FEDERAL MAR

COMMISSION

24th

Annual Re

for

Fiscal Yea

1985

TABLE OF CO

LETTER OF TRANSMITTAL

MEMBERS OF THE COMMISSION 

I THE COMMISSION

A History 

B Functions 

C Organization 

II THE YEAR IN REVIEW

A Introduction 

B Rules to Implement the N

C Agreements 

D Loyalty Contracts 

E Shippers Associations 

F Tariffs and Service Cont

G Anti Rebate Certification

H Controlled Carriers 

I Ocean Freight Forwarders 

J Access to Cross Trades 

R Prohibited Acts 

L Penalties 

M Complaints Investigation

N Data Collection and Stud

0 Automation of Tariff Filin

P Miscellaneous Developmen

III SURVEILLANCE

A General 

B Tariffs 

C Prohibited Acts 

D Agreements 

E Surveillance Plans for th

IV DEVELOPMENTS IN MAJOR US FO

A Transatlantic Trade 

B Mediterranean Trade 

C African Trade 

D Transpacific Trade 

E Latin America and The Ca

F Middle East Trade 

G Worldwide Trade 
APPENDICES

TABLE OF CONTE

V DEVELOPMENTS IN MAJOR OS 

A US MainlandPuerto RV

B OS Mainland Atlantic 

C OS Mainland Pacific 

VI TARIFF AUTOMATION 

VII SIGNIFICANT OPERATING ACT

A Office of the Secretar

B Office of Administrativ

C Office of the General 

D Office of Policy Plann

International Affairs 

E Office of Regulatory O

F Director of Programs 

G Bureau of Agreements a

H Bureau of Tariffs 

I Bureau of Hearing Coun

J Bureau of Investigation

VIII ADMINISTRATIVE ACTIVITIES

A Office of Personnel 

B Office of Budget and F

A Organization Chart 

B Commission Proceedings 

C Agreement Filings and 

D Tariff Filings and Sta

E Civil Penalties Assess

Fiscal Year 1985 

F Field Investigations 

G Statement of Appropria

Receipts for the Fisca

September 30 1985 

H Example of MarketShare 

I Procedures for Compilin

Section 18 Study 
Ottire of tile aihntnnnn

febetal Mar

lenshinD

To the United States Senate and 

Pursuant to section 10e2

of 1961 and section 208 of the 

amended I am pleased to submit 

of the activities of the Federa

year 1985 ending September 30 
i
MEMBERS OF TH

Alan Green Jr J

Chairman

Appointed 1981

Term Expires 1986

R Oregon

Robert Setrakian J

Commissioner

Appointed 1983

Term Expires 1987

D California

1 Resigned May 12 1985

Edward J 

Commis

Appointe

Term Expi

R Cal
v
I

THE COM

A Hi

The Federal Maritime Com

independent regulatory agency 

effective August 12 1961 

Maritime Board the Commis

administration of the regulato

Act 1916 The shipping laws o

separated into two categ

promotional with the res

promotion of an adequate and e

being assigned to the Maritime 

within the Department of T

Maritime Commission was give

regulation of the ocean commerc

B Fun

The Federal Maritime Com

administration of varying port

statutes Chief among these a

and 1916 the intercoastal Sh

Merchant Marine Acts of 1920 a

1984 represents a major chang

facing shipping companies i

commerce of the United States
The Commission sprincipa

are as follows

Oversight of certa

foreignflag common 

persons engaged in 

These agreements i

joint service and spa

Receipt and review o

regulation of rate l

flag common carriers 

foreign commerce

Guarding the rights o

engaged in the fore

States from restric

rules and regulatio

andor the practices 

have an adverse eff

United States

Maintaining the rig

companies to transpo

foreign trades

Regulation of rate

tariffs and practic

carriers in the dom

US

Licensing of int

forwarders

Issuance of pass

evidencing financia

owners or charterers 

injury or death o

nonperformance of a v

investigations of di

classifications an

foreignflag ocean 

operators and freigh

foreign andor dome

United States

Rendering decisions 

rules and regulations 

water in US fore

commerce terminal o

and other persons su

the United States
One of the Commission s 

involves the administration 

section 5 of the Shipping Act o

grants ocean common carriers e

laws as contained in the She

agreements filed with the Comm

FMC reviews and evaluates certa

that they do not exploit the 

and to ensure that agreeme

unreasonably high prices f

unreasonably low levels of serv

Beyond the Commission s

regulate the activities of com

commerce of the United States 

with the treatment of the shipp

and conferences The Shipp

carriers and conferences from 

preferential practices in dea

parties engaged in US comme

carriers and conferences to ma

contained in tariffs publi

applicable rates and charges 

actually charged for service re

file with the Commission can be 

of certain state controlled sh

has no authority to disapprove 

filed in the US foreign comme

entry into the oceanborne comme

Generally the Commission 

equity and stability in the 

commerce Given the large perc

that is transported by ocean 

facilitated by other entities u

of the Commission the Commiss

efficiency and economy in t

commensurate with commercial r

protect the US shipping publi
C Orga

The Federal Maritime Co

Commissioners appointed by the 

with the advice and consent 

Not

the

the

more than three members of 

same political party Th

Commissioners to serve as 

chief executive and administra

Nine offices are directly 

Chairman Office of 

Administrative Law Judges O

Office of Policy Planning and 

of Regulatory Overview Office 

Office of Equal Employment Op

and Office of Budget and 

operating Bureaus report to th

responsible for the Commisss

Hearing Counse

Trade Monitorin

of the Commiss

of

Agreements and

representation

the Bureaus

was

and

In fiscal year 1985 the 

authorized a total of 239 

had a total appropriation 

of the Commission spersonne

DC with field offices in New 

Los Angeles New Orleans Mia
I

THE YEAR I

A Introd

During fiscal year 1985 

the Federal Maritime Commis

independent regulatory agency 

1984 continued to dominate the 

shipping industry Most of 

involved implementation of the 

rulemaking actions interpreti

processing of filings

The Shipping Act of 1984 

17011720 was signed into law 

20 1984 and became effective o

product of several years of le

may have been the most signi

States shipping statutes since 

enacted in 1916 The stated pu

Establish a nondiscrimin

the common carriage of go

commerce of the United 

government intervention an

Provide an efficient a

system in the ocean comme

is insofar as possib

responsive to internation

Encourage the development 

efficient United Statesfl

meeting national security 

This part of the Annua

explanation of the 1984 Acs 

Commission sprogress in admi

the first full year of the Act s 
B Rules to Implem

The 1984 Act required 

interim rules by June and a

December of 1984 During t

Commission not only developed 

provisions in the 1984 Act 

completely restructured all 

contained in Title 46 of the 

Parts 500 to end

In the first quarter o

regulations implementing the 

edited regulations became ef

date for regulations appea

Regulations CFR annual 

September 30 to December 31 

new rules could appear in the 

in early 1985 All this w

inter alia the Office of t

most cooperative and helpfu

gigantic undertaking

The final rules were res

Subchapter A General 

Parts 500505

Subchapter B Regula

Forwarders Marine Term

Vessels Parts 510540

Subchapter C Re

Carriers and Related A

Commerce Parts 550 569 

Subchapter D Re

Carriers and Related A

Parts 572587
In December 1984 befo

new final regulations the 

further rules and amendments 

purposes of the 1984 Act The 

was established to coordinate 

each of the Commission smajo

and began working on potential

The most important rule

fiscal year 1985 included reg

status andor modifying proced

Transshipment agreements 

Non substantive agreement

Independent action Docke

Commodities excepted fro

Docket No 85 6

Electronic filing of tari

Marine terminal agreement

Tariff refunds Docket No 

Miscellaneous modificatio

85 4

Financial reports of dom

17

Free time and detenti

interchanged equipment D

Service contracts to be 

in fiscal year 1986

The rulemaking activity o

discussed elsewhere in this re

58 65 describing the activi

General Counsel
1 General

C Agre

A major reason for the 

of 1984 was to expedite the ag

established under the Shipping 

significant delays between the 

filed and the time they were 

The reasons for these delays w

that a series of decisions had 

proponents of certain antic

parties opposed to a particula

degree of success demand t

investigation before approving 

process could and did result in 

The Shipping Act of 1984 

1916 with respect to the reg

among ocean common carriers a

the foreign commerce of the 

made significant changes with 

The kinds of agreements t

The mandatory content of 

The procedures for filin

agreements and

The parameters of the an

confers on agreements

Other areas of significant c

definitions and a somewhat mo

Under the 1984 Act 

automatically without Commis

filing unless

The agreement is rejected 

format requirements

The Commission seeks mor

effects of the agreement 

The Commission obtains 

operation of the agreeme
The Commission is also autho

statutory review period to n

notice of the agreement sfilin

Register

The broad public interes

competitive impact of agreeme

by a new general standard w

those agreements reducing co

shippers costs are unreason

service is unreasonably dec

believes that an agreement w

the general standard it can 

to enjoin the operation of 

circumstances the burden o

Commission and no intervenor

action

2 Agreements Subject to the A

The 1984 Act applies to 

common carriers to

Discuss fix or reg

including through rates 

and other conditions of s

Pool or apportion tra

losses

Allot ports or restric

number and character of 

Limit or regulate the vo

passenger traffic to be 

Engage in exclusive 

working arrangements am

more marine terminal ope

common carriers

Control regulate o

international ocean tran

Regulate or prohibit the

Significantly agreements amo

carriers and among freight fo

to the Commission sjurisdicti
The major types of agreem

are further discussed at pp 

agreements on file at the end 

Appendix C

3 Independent Action

Under the 1916 Act confer

their individual members to 

rates if the member was diss

rate and was unable to chang

system Some conferences perm

some did not

The 1984 Act requires a

contain a provision stating th

take independent action on any 

more than 10 calendar days no

fiscal year 1985 all approved 

amended to contain the necessa

action

The statutory right of 

apply to conference service con

conference to permit restrict 

entering into service contracts

4 Antitrust Immunity

The 1984 Act clarifies

immunity

immunity applies to

becomes effective

carriers undertaken

It also

granted to agreement

any agreem

with a re

10

that they were pursuant to an e

In addition any exemption gr

requirement carries with it an

also precludes private parties 

or injunctive relief under the 

to violations of its provisions
5 Intermodal Authority

The 1984 Act authorizes 

enter into conference and o

intermodal rates and extends 

arrangements Under the 191

Commission had authorized a n

through intermodal rates betwee

points abroad The Departmen

this action on jurisdictional 

never fully resolved

The 1984 Act clarifies 

including the fixing of 

activities to which conference 

year 1985 the filed confere

reflected widespread utiliza

intermodal authority

6 Agreement Processing

In order to prepare for 

agreement processing procedure

to the Act s effective date and 

Trade Monitoring had been res

statutory demands of time so t

rapidly through the system It 

the existence of a staff orga

monitor conditions in various 

excessive market power which co

increase in rates or unreasonab

Since the effective da

agreements are initially filed 

quickly flow through a rece

receipted numbered examined 

the administrative aspects of 

notice of the agreement is pr

Federal Register The law r

forwarded to the Federal Regis

following the date the agreemen
The 1984 Act gives the 

reject any agreement which 

regulations Thus far the C

agreements for technical rule 

effort is made to work with 

correct deficiencies on an 

imposing unnecessary burdens 

compliance in a more expedited 

Under the new statute 

agreement processing are co

forwarded to the Federal Reg

This notice normally is publis

comment basis depending upon 

agreement Under the old law 

approval of an agreement was 

was created whereby the Comms

the agreement provisions with 

without their opponents bein

However under the new law no 

because the Commission canno

becoming effective on its own 

injunction One of the prima

is the staff ability to neg

to agreements on an inform

resolving issues without the n

and costly hearing

The new law does provid

Commission can shorten the 

review period between the time 

effective date Specifically 

the review period to as littl

the Federal Register Additi

the Commission to extend 

situations where the Commiss

time is necessary in order to 

to fulfill its regulatory 

review During fiscal year 

the 45 day review period in 
agreements were handled on a 

most cases involving shortened 

considered to be of a less sign

The new flexibility of

demonstrated by the total 

amendments filed in fiscal yea

with 354 in fiscal 1984 At 

number of conference and interc

at the end of the fiscal year d

likely as a result of the 

effectuated in various trades 

at pp 27 44

For some time the Comm

using agreement tracking sys

basis including the utilizatio

improve monitoring capabilities

D Loyalty 

A loyalty contract or d

previously known is a contra

carrier or conference offers a 

portion of a shippers carg

formerly permitted and granted 

1916 Act if approved by the C

approved 33 such contracts 

conferences

The 1984 Act prohibits th

except in conformity with the 

legislative history indicates t

by a single carrier may be ac

use of such a contract by a co

the antitrust laws

13
S Shippers 

The Shipping Act of 

associations for the first tim

ocean transportation They ar

of shippers which on a non p

cargoes to secure volume r

contracts The Act expressl

conferences negotiate with sh

provides that such associati

contracts on behalf of 

associations have not been gra

the

associations

1984 Act

became

In

parties

fiscal

to

1 Tariffs

The 1984 Act retains 

carriers and conferences file 

showing all their rates and c

forest products recycled meta

waste have been excepted fro

carriers may also offer rates 

with the volume of cargo offer

time ie timevolume rates

During fiscal year 1985 

of tariffs filed with the Com

other rates involving transpo

commerce At the end of fis

hand over 5000 tariff public

D

2 Service Contracts

F Tariffs and S

Service contracts are a

commits to a minimum amount o

an ocean common carrier or co

rate schedule and a defined 

must be filed confidentially 
concise statement of its essen

in tariff format The essen

available to all shippers simi

The essential terms of a serv

The origin and destinatio

areas

The commodity involved

The minimum volume

The linehaul rate

The duration

Service commitments and

Liquidated damages for non

The varia

service contra

carriers and

transportation

needs

bles which can 

cts are almost 

shippers sign

arrangements s

During fiscal year 1985 

Commission over 2100 service co

contrast to fiscal year 1984 

about 5 pages in length w

Commission the average service 

end of fiscal year 1985 was 1

demonstrates the commercial 

arrangements between shipper 

States foreign commerce

G AntiRebate 

The new Act continued 

rebate certifications from ve

by water in foreign commerc

provision that the same type o

required of non vessel operatin

in foreign commerce This c

implementing the new statute at 

15
During fiscal year 1985 

on NVOCC s who did not c

requirements to file anti re

formal proceeding was still 

1985 See p 91

H Controlle

The 1984 Act retains the 

owned or controlled carriers 

the Ocean Shipping Act of 1978 

to other procedural requirem

controlled carrier rates not be

days after they are filed and 

reasonable

During fiscal year 1985 

the Commission slist of co

carriers were being conside

addition to the list and o

deleted from the list See p 

I Ocean Freig

No person may act as an o

licensed by the Commission L

person who is qualified by 

render forwarder services and 

A person whose primary busines

may forward shipments for its o

However a forwarder who has a 

interest in a shipment may no

ocean carrier on this shipment

At the end of fiscal year 

licensed ocean freight forwar

from the previous fiscal year 

16
J Access to C

Section 13b5 of the 

Commission to suspend the tarif

or take other appropriate action 

host nations unduly impair acces

foreigntoforeign trade or cr

is intended to complement sectio

Act of 1920 which gives the C

counter discriminatory actions 

foreignflag carriers in the US 

reflects a Congressional conce

United Nations Code of Conduct 

Liner Code particularly its 

USflag carriers continued 

cross trades where the Code app

With the advent of more 

more efficient and effective int

theworld and other extended 

trades have or will become an 

operator sservice Therefore 

one of the more important featu

flag carriers

By the end of fiscal year 

filed under section 13b5o

During the fiscal year however 

flag carriers were contacted 

Commission plans to preserve and 

competitive access in foreign 

with these representatives to 

spots where 13b5action mig

K Prohibit

Section 10 of the 198

activities which are prohib

essentially restate prior prosc

carriers adhere to their tarif

transportation at other than 

17
carriers not discriminate aga

also include some new ones fo

Using a loyalty contrac

antitrust laws

Refusing to negotiate wi

Boycotting or taking o

results in an unreasonab

Engaging in conduct th

use of intermodal servic

Engaging in any pred

eliminate the particip

particular trade

L Pe

Under the 1984 Act a v

issued thereunder or Comm

civil penalty not to exceed 

except where otherwise provid

violation was willfully and k

of civil penalty could be 

violation Each day of a con

offense In addition the C

carrier stariff or its righ

for violations of certain pro

During fiscal year 1

assessed or compromised b

violations of the 1916 or 1

early to develop cases inv

statute A list of the pen

during fiscal year 1985 appea
M Complaints Investig

Any person may file a co

of the 1984 Act except for 

reparations therefor The Com

investigate any conduct or agre

be in violation of the Act Th

may seek an injunction in 

activity thought to be in vio

complainant loses reasonable 

awarded to the respondent

In foreign commerce for 

three years of the accrual o

Commission can award the comp

injury including loss of 

attorney sfees If the injur

certain prohibited acts the aw

the amount of actual injury

During fiscal year 1985 

Rules of Practice and Procedure 

attorneys fees in reparations 

commerce under the 1984 Act b

under section 2 of the Interco

See 46 CFR 502 253 In fisc

will develop further regulations 

Fiscal year 1985 saw a 

number of formal proceedings e 

in large part due to the 1984 

processing of filed agreements 

many Commission instituted 

agreement activities At the s

of informaldocket reparations 

from 58 in fiscal 1984 to 91 i

because the Commission had incre

an informaldocket small cla

10000 See 46 CFR 301 305 

19
N Data Collect

For a period of five yea

Act the Commission must colle

Act on

Increases or decreases in 

Changes in the frequenc

service

The number and strength o

The level frequency an

the Commission

The Commission must consult w

DOJ Department of Transpor

Commission FTC on this data 

provide them access to the dat

An Advisory Commission 

Shipping will be established 5 

Act At that time the Comm

and the Advisory Commission an 

Act DOJ DOT and FTC must 

later

One year after the Adviso

it must provide Congress 

conferences in ocean shipping 

conferences should be prohib

closed For additional inform

and the steps taken thus far 

with this mandate see the disc

O Automation of 

During Fiscal year 1984 

effort to explore the automa

undertaking continued in fisca

the electronic collection exa

tariff information During fi

20
be performed of the te

considerations of proceeding 

Commission hopes to arrive at a 

overall feasibility of this 

decision the Commission wi

through an Industry Advisory 

viewpoints of representatives 

and various elements of the shi

detailed discussion at pp 48 4

P Miscellaneous 

During fiscal year 1985

Further progress w

automated tariff system 

Volume 23 of the Coms 

finalized for publication 

A draft of the Coms

parts of Title 46 United 

to Congress for eventual 

of that Title See pp 6

The Commission partic

matters involving interna

44

The Office of 

established See pp 78 7

The Office of Direc

effectiveness

operating bureaus

of its

for

sup

b

1984 Act See pp 79 et 

Over 100 passenger v

performance and casualty 

The Commission contin

violations of the the 

administers and to assess 

See pp 99 101

The Commission sad

continued to facilita

sufficient and approp

resources for its operat

107

21
I

SURVE

A G

If there is one word tha

the regulatory philosophy of 

would be surveillance 

regulation of ocean shipping 

was so emphasized in the 19

history that it deserves spe

Just after the passage 

intensively during fiscal 

initiated programs to achieve 

ocean shipping industry so as 

effects on United States 

prohibited acts both by p

and where prevention is not 

Also during the fiscal y

Commission sother actions we

areas for surveillance 

implementation

B Ta

1 Compliance and Surveillance 

During fiscal year 19

completed its portion of the 

and Surveillance Program whic

North AtlanticUnited Kingd

participation included auditin

and major independent vess

including Polish Ocean Line

carrier serving the subject 

requirements of 46 CFR 580 

Of the ten tariffs audited a

2
rate increases surcharges frei

activities independent action 

or exit in the trade during a 

July 1985 In all instances the 

being issued to the conference

correction of deficiencies found 

of the fourth quarter all de

tariffs had been corrected Of 

audited the majority of the ne

been initiated and follow up 

requesting correction of the rem

Also reviewed for complianc

1984 and applicable Commission 

service contracts anti rebate 

common carrier compliance with 

requirement and financial repo

with the Securities and Exchange 

2 Review of Tariff Supplements

During the third quarte

reviewed all incoming tariff s

compliance with 46 CFR 580 

majority of the supplements f

format andor content To reso

advisory letter was prepared 

filing of supplements Inclu

samples of the most frequently 

along with a detailed explanati

anticipated that the letter wil

quarter

C Prohibite

The Bureau of Investigation

revised its entire operating pl

incorporate the increased respo

surveillance of service contrac

23
and non vessel operating com

investigative activity into t

in the Shipping Act 1984 A

new operating plan was develo

Counsel This plan was ful

1985 and strengthened the 

advisor to the Commission s

coordination with the Coms 

Offices

surveillance

especially

enforcement

in car

responsibilities under the new 

D Agr

Under present statutory 

responsible for maintaining 

activities of parties to filed 

to its jurisdiction in order 

with the Shipping Act 1916 

Commission rules The Offic

Bureau of Agreements and Trad

with the responsibility for 

Appendix C indicates the var

with the Commission

The drastic changes w

area of agreement processin

significant impetus for trade 

statute it is clear that 

subject to rejection for tech

the standards of section 6g 

should be permitted to take 

maintaining surveillance over 

order to satisfy this statuto

possible violations of other 

the Shipping Act of 1984 the 

Monitoring refined its surv

effectiveness in the monitori

2
During the past fiscal ye

to the expanded commercial f

Shipping Act of 1984 forme

conference agreements in the his

example in the Far East trades 

Rate Agreement and the AsiaN

Agreement encompass the trade 

Japan trade of sixteen previo

almost all of the major carriers 

Accordingly in fiscal 

Agreements and Trade M

monitoring surveillance program 

review of selected trades sp

these new superconferences 

reports including operator 

tonnages of majormoving 

identification relevant tariff 

use of service contacts and an 

as well as an analysis of the e

is being prepared In addition 

overall assessment of chang

suggested areas of focus for po

Surveillance of specific 

implemented through the Offics 

program of the USNorth At

The essential goal of the 

information to establish whethe

observing relevant shipping sta

The pilot study disclosed that 

flagrant carrier involvement 

defined by the 1984 Act

in fiscal year 1984 the 

HKSC filed a petition pursua

1984 Act alleging that a gen

effect by the two eastbound 

violated the general standard 

Act The HKSC sought to enjo

the GRI pursuant to section 6h 

25
data gathered through its su

of Agreements and Trade Moni

the petition for investigati

Commission

1985 the

The

initiated

deny the petition 

Commission

Bureau of

several

denied

Agreemen

inquirie

activities relating to possib

th

and to activities of parties 

scope and authority of a filed 

E Surveillance P

The surveillance activi

conducted by operating burea

direction

major plans

of

for

the

surveillance

Director o

identified by the Director of 

Implementation of contin

program

Development of economic 

and enforcement activiti

Pursuit of tariff autom

Automation of freight 

and passenger vessel pro

Revising the program for 

to attain better efficien
IV

DEVELOPMENTS IN MAJOR 

A Transatla

Fiscal year 1985 ushered 

superconferences the agreemen

since the effective date of th

October 12 1984 two new confe

westbound became effective re

the North Atlantic trade and 

Atlantic trade On November 19 

two new westbound conferences 

six conferences in the westbo

trade This action resulted 

represented by one conferenc

conference tariffs inbound I

the year the outbound confer

rate increase while the inbound 

During fiscal year 1985 

agreements in the Transatlantic 

January 13 1985 an interconfe

eastbound and westbound N

Conferences became effective 

collectively deal with shipper

interconference agreement be

westbound GulfEurope Confe

authorizing collective ratemak

1985 a discussion agreement be

US AtlanticEuropean Confe

ratefixing agreement between 

Ocean Lines was filed with the 

During fiscal year 198

experienced changes in the form 

and changes in the service of 

among the independents flourishe

new services such as Mediterra

Scan America Gearbulk Indep

Saraband Line Hafskip which p

27
via a feedship service throug

service to Europe Double 

conference member

Competition in the trade 

four carriers The casual

Line Parklines Double Eag

Eagle and Scan America withdr

months of entering

During the year the p

strengthened by the addition 

and Intercontinental Transpor

expansion plans of SeaLand S

Land announced its intentio

capacity of three of its c

ordered the conversions of fo

Atlantic fleet As SeaLand 

their ship enlargement progr

completed its expansion with 

giant containership

Despite the new entran

westbound trade appears stab

received no relief from the o

Despite the poor eastbound 

European cargo and the effo

appears to be an incentive fo

The increase in capacity may e

carriers during the next fisca

The transatlantic trad

upswing in inter carrier s

joint service and discussion 

full year the 1984 Act was in 

A new major space 

agreement No 217 0106

West CoastNorthern Eu

Scanstar Joint Service 

Europe Express Joint 

operation of a fleet o

over 13000 TEU s

28
Agreement No 21

010

AutomarAtlantic Containe

authorizing the charter o

in the US AtlanticEurop

Agreement No 217 010723 e

Navigation LimitedLASH C

and Cooperative Workin

westbound space charters 

in the US Atlantic and G

Agreement No 217010738 

up to 8 vessels aggreg

Barber Blue Sea Joint Ser

the eastbound US Atlanti

The Trans Freight Lines

Space Charter Agreement 2

use of space on Trans Fr

US GulfEurope trade

Agreement No 207 010666 

North American Services 

operating two vessels 

AtlanticScandinavian trad

Agreement No 207 01068

Products Carriers Inte

between Mitsui OSR L

Company authorized to op

forest product bulk 

CoastEurope trade

Agreement No 203 010664 

Carrier Trade Agreement 

providing a forum for ocea

matters of mutual concern 

over capacity through ra

encouragement of technolo

of commercial disputes an

and trade instability

B Mediterran

The 1985 fiscal year featur

of the inbound Mediterranea

system as four existing confere

MEDUSA The new superconferen

over the trade from Mediterra

Atlantic and Gulf ports of the 

MEDUSA also includes inland 

intermodally by microbridge a

29
lines expressed the hope tha

contribute to the stabilization 

In July 1985 two new co

one westbound were establish

conferences in the trade betwee

Israel The Commission postpon

conferences in order to acquire 

which to assess their effect o

expanded geographic scopes 

authority

During fiscal year 198

agreements between the Mediter

trades became effective 

interconference agreement becam

service contract authority for 

Spain to the US Atlantic and 

four interconference agreements 

Line and four Mediterranean

became effective Although pr

declining rates have continued 

trade fiscal 1985 saw the entr

into the competition Evergre

service between US East Coas

while Maersk Line and Barbe

Mediterranean ports of call to 

Line and Cie Nationale Al

initiated new services as the 

Westwood Shipping Lines resum

products service and Adr

operations between the Adriat

Meanwhile Atlantrafik Expres

service between Leghorn Ital

Other carriers contributed to 

with additional vessels and inc

A number of rationalizatio

during the 1985 fiscal year

Spanish Compania Transa

the Italian state owned 

joint service to the US 

30
Lykes Bros Steamship 

chartering and equipme

Costa Line and Costa c

Compania Transatlantica 

The Costa Armatori Tra

Sailing Agreement 2130

of up to 5 vessels agg

South Atlantic and G

trade

The Med America Express 

established between Ita

the US AtlanticMedit

to operate up to 8 vess

These and similar rationaliz

the part of established ca

competition

During the year action 

Parliament to protect nation

unfair competitive practic

regard to the predatory 

crosstraders and the gover

Italian carriers gain an 

cargoes Although Italy ha

Code and its socalled 4

indicated that forty percen

share

C Afri

The African trades expe

inter carrier agreement ac

Fiscal Year

Agreement No 2070106

East Africa Service Joi

Great Lakes Atlantic a

Agreement No 217 0106

SITRAM superseded an 

between these lines in 

Atlantic trade

Agreement No 217 01066

arrangement between Torm 

the Ivory CoastUS At
Agreement no 213 010753 e

and sailing agreement betwe

Line involving eight vessels 

Africa trade

D Transpa

The transpacific trades s

shortages during fiscal year 19

long been plagued with serious w

eastbound trades have been ge

years Unfortunately that is no 

of the dollar during the summ

decrease in import demand 

augmentation programs have caused 

As a result inbound rates fell 

less than one year Certain k

footwear textiles and electroni

of fifty percent or more At the 

most informed observers anticipat

trend In some respects 

constituted a more classic rate 

earlier periods of declining p

certain modernized carriers wer

higher rates with superior 

virtually all service is high qu

to center solely on price

The fear of carrier bankrup

indiscriminate ratecutting provide

reorganization of the transpacifi

the 1985 fiscal year In J

Westbound Rate Agreement TWRA 

westbound scope covered previ

conferences ie the trade outb

in the United States to Ports and 

Singapore Malaysia Indonesia 

The agreement has 18 particip

approximately 119 independent tar

joining TWRA Due to the enorm

32
filing of the TWRA tariffs w

of the members independen

conference tariff did not b

1985

August of 1985 saw the ad

Eastbound Rate Agreement ANE

conferences and partially su

the parameters of TWRA encomp

Far East trade the scope of 

inbound jurisdiction This e

related to the impressive 

conference system among J

reluctance of Japanese lines t

By contrast the Kore

dominated by independents and 

deemed necessary Also in 

agreements between two Hon

Conferences and two Japan

became effective permitting 

with each other concerning 

conference established serv

incentive programs

Although both supercon

attracting the large majority 

neither has as yet succeede

rate trends Although the 

bear ultimate responsibility 

independent action and a pro

have functioned as proximate 

fiscal year both conferences 

independent implementation of 

In July the Commission 

Order of Investigation and H

of the Transpacific Westboun

Violations of the Shipping 

concerned the implementation 

revenue levels and alleged un

3
utilization of service contra

minimum revenue levels is a

mandatory independent action 

Although the resolution of Dock

the close of the fiscal year i

Conference s questioned polici

stabilizing westbound rates 

were repeatedly reduced pos

commodities ultimately cancelle

contracts were being negotiated 

During the fiscal year bot

defections from several origina

succeeded in gaining the pa

remaining independents Observ

crucial question of the 

contribution to rate stability

Sea Land US Lines C

carriers planned expansion 

aggravation of overcapacity pr

new rationalization measures offe

situation On another front a 

Korean lines simultaneously red

and decreased competition on sev

the trans pacific trade fea

cooperative arrangements as 

Lloyd and EAC Line were amon

rationalization agreements

Seawinds entered bankruptc

fiscal year and withdrew c

Although no other carrier had c

the close of the fiscal yea

predicting that certain of th

ultimately follow suit Meanw

firm was forced into reor

conducts liner operations elsew

the transpacific has been essen

34
The trend toward ro

continued as Evergreen and 

their innovative programs D

announced their intentions to 

US East Coast route on an R

plans to join this grouping

On the governmental fro

with the world trend toward p

carriers were alarmed by ste

authorities to set minimum 

outbound routes Although th

maintain order in the shippin

concept as unjustified interfe

In the USJapan tr

accommodate USflag carrie

effectively closed to them eg 

trades During January 

served as technical advisors 

in Washington DC The pu

discuss such trade irritants 

on the movement of high cu

participation of USflag c

US leaf tobacco exports to 

exports to the US and 

service restrictions on foreig

During fiscal year 19

issues of port service rest

It appeared that progress was 

cube containers when in A

Nakasone announced in his m

carriers would be able to t

subject to certain condition

those conditions ie limit

restrictions and the necess

virtually every container mo

situation which is only cosm

April 1985 situation
The US is also concerne

Japan becoming a contracting pa

thus far Japan has not taken 

also discussed in bilateral mee

The Japanese interest in 

USJapan trade of a Fidelity 

for tariff refunds for shippers 

proposal resulted from Japanese 

small shippers of certain provis

1984 Subsequently two fre

petition for declaratory order w

remove uncertainty as to wheth

System constitutes a loyalty con

the Shipping Act of 1984 

pending before the Commission

One of the major events 

reconfiguration in the operation

operators In the Japan Califo

had previously operated und

arrangements Agreements Nos 

carriers and 9731 which involv

operators reconfigured their op

manner whereby none of their sp

agreements involved more than t

213010654 213010655 and 213 

separate revenue pool Agreement 

their overall US PacificJapan 

The transpacific trades als

upswing in inter carrier agreem

year of the 1984 Act particu

charter and rationalization arra

Agreement No 217 010651 

ServiceHapagLloyd Tran

Charter and Sailing A

rationalization of a flee

23180 TEU s in the US P

36
Agreement No 21301

rationalization agreem

Orient Lines and Orient 

Kawasaki Eisen Kaisha 

Service This arrang

routing to serve the 

eastbound through the S

customary westbound rou

thus transforming this 

theworld service con

Agreement No 213010

Forest ProductsBulkP

Agreement among the 

Transpacific Bulk Mari

Service This arrangem

or both of the other 

Line is unable to meet 

due to a lack of space 

would be inefficient or 

Agreement No 2130

chartersailing agreem

operators Korea Marin

Container Lines with 

vessels aggregating 

PacificFar East trades

Agreement No 217 0107

arrangement between EA

Navigation in the US 

Agreement No 213 0107

and sailing arrangeme

Company

Pacific

and

trades

Mitsui OSK 

exclu

rationalize the ope

aggregating 20000 TEs

The ColumbusPACE Cross 

authorized the rationa

vessels aggregating 240

and GulfAustralasia tr

Agreement No 217 01

Transpacific Joint Serv

the Canadian Transport 

from JapanKorea to the 

E Latin America 

Fiscal year 1985 was a 

American trades While carg

United States decreased 
increased This trade imbalanc

the US dollar abroad import 

debt laden South American cou

policies practiced by most coun

On December 15 1984 a new 

in the trade between the US 

Netherlands Antilles On Janua

became effective in the trade b

LeewardWindward Islands On 

conference became effective in 

South Atlantic and Gulf and Cen

In the Caribbean and Cent

cargo space increased as more 

induced by favorable condition

both Evergreen Line and Zim Co

the Caribbean Evergreen Line 

Jamaica in both directions of 

Around the same time Zim bega

center for its MediterraneanUS

addition both carriers starte

US Gulf and the Caribbean to 

their larger trade routes

Another new service in th

started in fiscal year 1985 

and Amazon Line was launched 

and general cargo service betwe

the Leeward and Windward Islan

which has operated in the Caribb

into a new liner service Tecma

The composition of compet

changed

service

Express

space existed

start of 1985

The cause of

inauguration

substantially in 1985 

during 1984 of Johnso

and Delta Line in this 

The situation 

Overtonnaging i

the overtonnag

of three new serv

38
fourth Independence Line 

Generale Maritime began fo

British Colombia Line a Can

service in February on a 

February the Danish PVC Lin

American service to includ

operates on a monthly sailin

Line owned by former princip

new fortnightly service

Also of interest in this 

was the trade embargo impos

Reagan in May which impacted 

carriers operating in th

particularly in light of the 

carriers affected included 

Caribbean Transport Seaboard 

The biggest news in th

fiscal year 1985 may have bee

by United States Lines 

approval from the Maritime A

US Lines paid Delta 366 

shares of preferred stock 

Deltaowned ships and the

interest in three new ro ro 

build a fourth in a nonUS 

Delta s three operating di

subsidies were in the US 

America US GulfWest Afri

East and West Coast of South 

America trades Through this 

its position as the principa

America and West Africa

In August of 1985 US 

three operating subsidies b

conditions At the end of t

Steamship and Farrell Line 

Administration for the subsidy 

39
During fiscal year 1985 

authority under section 19 of th

in several instances both on 

response to specific complaints 

by foreign governments and c

trades These cases focussed 

conditions in the trades wit

specific carrier complaint reg

and a specific carrier compla

trade All of these cases 

American trades emphasizing th

towards shipping policy taken 

Latin American trading partners

In Docket 84 33 begun as 

close the Commission on it

proceeding pursuant to section 

conditions unfavorable to shipp

with Argentina and Brazil T

initiate such a wide rangin

conditions under section 19 au

standing complaints about econo

both US shippers and US and 

problems were alleged to h

extensive systems of cargo res

practices of the governments of 

On October 19 1984 the 

Departments of State Transpor

the Office of the US Trade R

seeking to limit Docket 8433 to 

defer any consideration of propo

to be granted permission to p

without being characterized 

respondent The presiding Ad

the first part of the motion 

December 26 1984 the Commis

Executive Agencies motion to li

finding of facts

40
Meanwhile proponents 

unfavorable conditions in 

arguing that there were n

December 31 1984 and Feb

Rebuttal statements were s

addition the presiding Adm

from the FMC Bureau of Hear

case and from the US Exec

on topics including the leg

Understanding and the limi

places on Commission action 

in March 1985

In April 1985 the US 

motion asking the Commission 

defer the filing of final b

the interests of US foreign 

the Commission were to suspe

1985 the Commission issu

Restructure Proceeding leavi

the proceeding to the presid

The Commission emphasized in 

finding purpose recommendin

such as the question of fina

allowed for comment on the N

as fiscal year 1985 ended

In September 1984 AS 

Ivarans Lines a Norwegian fl

carrier in the US trades w

of a northbound pooling agree

under section 19 to remedy all

shipping in the US Argen

Ivarans argued that Argentin

carriage of Argentine expo

agreement members thus discr

Commission accepted the pet

Departments of State and 

diplomatic assistance in this 

Commission was notified th
informally assured by Argentine 

not intend to enforce Resoluti

Ivarans notified the Commiss

assurances directly from the A

Maritime and River Transport t

nor any other measures would be 

loading cargo in Argentina Iva

at this resolution and on Ma

issued an order discontinuing the 

In January 1985 Concorde

carrier filed a section 19 

USVenezuela trade Concord

existence and enforcement of V

laws and decrees as well as cu

preventing Concorde Nopal from a 

the trade Within a month th

issue a Notice of Proposed Ru

permitted the Commission 

Simultaneously the Commission 

State in an effort to resolve 

However in February of 1985 C

Commission to defer action a

resolve the problem amicably th

authorities for ConcordeNopal 

FloridaVenezuela trade Concor

for Commission delay in March a

its letter of May 6 1985 th

permitted to serve the trade up 

up to three vessels nominated 

therefore determined to dismiss 

and served an order to that effe

In terms of non conference 

this trade was marked by the fo

and joint service arrangements 

other trades such activity was 

the 1984 Act

Agreement No 217010072 e

arrangement in the Florid

between SeaLand Service an

42
Agreement No 21701068

and rationalization ag

Ecuadorian Line in the 

America and Mexico trade

Agreement No 213 01070

and rationalization agre

GulfVenezuela trade b

Corporation and CA Ma

Agreement No 20

WalleniusTransroll Join

vehicles and other cargo

and Gulf trades

Agreement No 207 01081

Service between Naviera 

Santa in the US Sou

Chile trade

F Middle 

On May 30 1985 a new 

the trade from the US Wes

West Asia

The Middle East trades 

higher incidence of non conf

activity during Fiscal Year 1

Agreement No 217 01073

arrangement between Sea 

Arab Shipping Company in 

Sea Arabian Sea Persian 

Agreement No 2130107

Barber Blue Sea North A

Space Charter and C

authorizing the rationa

aggregating 400 0 DW

GulfMediterranean and M

Agreement No 203 010762 

Eastbound Discussion Ag

to discuss transportatio

concern in this trade i

handling utilization 

problems and improvemen

and carrier services
Agreement No 217 010784 

Steamship Corporation to ch

vessels operated by the N

Saudi Arabia from the US 

Sea

G Worldwide 

The first full year of eff

also marked an increase in in

aroundthe world service chara

Agreement No 207 010668 pr

the worldwide Overseas Cont

into US foreign trades

Agreement No 226 010779 

Container Interchange A

participants to exchange e

equipment on a worldwide b

44
V DEVELOPMENTS IN 

A OS MainlandPu

On December 13 1984 

Permission Application No 5

of authority granted under F

which was scheduled to exp

special permission previously 

file tariff matter on no

postponing increases to its 

59 for a new one year period 

was sought the Commission de

current authority which Sea L

to expire as scheduled on Jan

designated as Special Permiss

SeaLand Service Inc 

14 1984 to its tariff FMC F 

Atlantic and Gulf ports and p

a notice of cancellation ef

tariff was cancelled in its 

filed with the Interstate Com

the last major carrier in 

tariff on file with this Com

non containerizable cargo 

Land filed a similar tariff 

as Freight Tariff FMC F N

Atlantic Gulf Ports and 

1985 The port application 

previous cancelled tariff FMC 

A proposed general rate 

filed by Trailer Marine Tran

scheduled effective date of 

by the Commission on August 

effective as scheduled 

connection with protests sub

supporting data submitted by 

representations of the prote

warrant suspension or inves
further determined that while 

material submitted by TMT appear

the Commission sstaff would au

the submissions fully complied w

requirements

On September 12 1985 the 

Islands GVI filed a petition 

Commission sAugust 14 1985 de

of TMT s 10percent general ra

RicoVirgin Islands trade A 

filed by TMT on September 24 19

at the end of the fiscal year

B US Mainland Atlan

The Commission was notified 

15 1985 of a proposed rate inc

Atlantic CoastHawaii trade file

Inc USL Since the increase 

overall rate increase published 

the preceding twelve months 

aggregated with two other 29

resulted in an overall increase 

Commission determined not to su

rate increase but to conduct a r

the methodology used for financ

changes to the Commission sregu

C U S Mainland Pac

On November 19 1984 Matso

filed a proposed 25 percent ov

rates and charges on commodities 

in the Pacific CoastHawaii trade 

The Commission issued an Order o

to determine whether the 25 pe

reasonable A final decision 

Commission in this proceeding du

46
vote could not be reached 

period thus the rates were d

for the purposes of Sectio3

Act 1933

47
VI

TARIFF AUTO

Tariff automation has been 

maritime community and the Comm

Tariffs have as a whole com

most important piece of informat

of business for oceangoing commo

manual form however they are i

not effective in providing the 

certain types of analyses

The tariffs filed at the 

one of the largest public data 

are approximately 5000 foreig

Commission Approximately 600 

The number of tariffs on file 

over the years from 1651 tariff

1963 to 4998 tariffs at the en

annual filing volume has increas

In fiscal year 1962 52000 tar

the Commission By fiscal year 

to 601 418 tariff pages in the f

With an ever increasing 

manpower the Commission has h

changes in order to be able to 

However the only avenue availab

long run is automation

Rate analysis is also 

information must be gathered t

search of tariffs and tariff p

capturing relevant data reduce

analysis that can be done to an 

The Commission therefor

automation of tariffs One is 

tariffs and the other is fo

information With respect to 

48
however the Commission acco

overall usage made of tariff i

tariffs accrues to the industr

marketing and contracting too

and conferences

efficiencies can

system of tariff

rating of cargo

well as automated tariff filin

It appears 

be achieved 

automation t

and the prep

49

In August 1984 Chairman 

Chairman James J Carey to ch

feasibility of Tariff Automa

report in August 1985 outlining 

this effort The Commission h

industry advisory committee wh

Edward J Philbin and which is 

and input of the private sec

Committee is composed of 

conferences non vessel opera

forwarders ports shippers 

transportation support firms 

first meeting in early 1986 

perform a technical feasibilit

to ascertain the most feasibl

the tariff automation project
VI

SIGNIFICANT OPERATING ACTIVIT

A Office of th

1 General

The Office of the Sec

preparing a regular weekly ag

consideration by the Commissi

action taken by the Commission 

processing formal complaints 

shipping statutes and other ap

and notices of actions of 

official files and records 

receiving and responding to sub

personnel and or records ad

Information Government in the 

responding to information re

staff maritime industry and 

instruments and documents of th

publications and documents re

before the Commission and co

volumes of Commission decision

also participates in the devel

reduce the length and complexit

ongoing

organizational

evaluation

structure

of the

and

eff

i

changes to the shipping statute

During fiscal year 1985 this O

Coordinated the handling o

by the Commission as a bod

the agency was without a C

Finalized

decisions

for publication V

Continued to review rules 

changes resulting from leg

Implemented the initial ste

plan for the Office

50
2 Informal Dockets Activity

This Activity is re

adjudication of claims filed 

carriers by water engaged 

offshore commerce of the Unit

be predicated upon violations 

or the Intercoastal Shipping A

of less than 10000 is soug

received under this program 

for freight adjustments arisin

carriers During fiscal ye

Activity received 75 new case

over fiscal year 1984 The A

docket claims which was an 

fiscal year 1984 The Acti

certain legal andor jurisdict

in light of changes brought 

1984

3 Office of Informal Inquirie

This Office coordinates t

system throughout the Agency 

complaints and information req

an increase over the previous 

complainants recovered nearly 

refunds in fiscal year 1985

The Office acted as liaiso

forwarders conference execut

bureaus within the Agency e

representatives and approp

During fiscal year 1985 th

inquiries and provide informa

1984 and also continued to r

President s Consumer Affairs 

Administration sviews on 

agencies

5
4 Office of Energy and Environm

This Office ensures Com

National Environmental Policy 

Policy and Conservation Act of 

Commission to complete ana

environmental aspects of agreem

before it Where Commission 

significant impact upon en

environment the Office is c

analysis of the situation and 

energy and environmental impac

year 1985 the Office review

docketed proceedings Of the

excluded from environmental an

action and analysis of the 

findings of no significant im

to prepare any formal energ

statements during the year

5 Administrative Services Activ

This Activity provides 

resources and facilities suppor

field offices It is responsib

space property supply 

operations furnishing c

duplicating printing and gra

emergency evacuation and t

control

During fiscal year 1985

Contracting services inc

agreements entered into w

American Management Systems 

Lloyds of London and Beki

The property function auto

through the purchase and in

The Activity was very ac

support of the Commission s

52
Communications services 

utilization of the data 

the Commission s word 

computers

Renovationredesignation 

Bureaus of Tariffs Agree

begun to provide better 

working environment and

The emergency evacuation 

reorganized with other b

6 Management Analysis Activit

This Activity is respon

Management and Budget cle

recordkeeping requirements 

otherwise implementing the Pa

The Activity also is respon

conducts internal management 

efficiency effectiveness an

agency resources and det

objectives are effectively ac

liaison with other governme

Federal Emergency Preparedne

Force Productivity project t

Assistance and the US Gove

In fiscal year 1985 the 

Coordinated OMB clearanc

implementing the Shipping 

proposed rules

Updated Commission record

Continued necessary lia

agencies concerning the 

data and

Assisted various office

special projects and inte

7 Final Decisions of the Com

During fiscal year 198

argument in two formal proc

concluding 9 formal proceedi

were discontinued or dismisse
determinations not to review Ad

terminating proceedings Sev

initial decisions in fo

administratively final upon e

Commission review

The Commission also con

applications and 91 informal d

against carriers for less than 

In rulemaking proceedin

sixteen final rules and disconti

decision As with last fi

finalized rulemakings to implem

and continued to institute o

appeared to be necessary or de

initiated this fiscal year will 

1986

1 General

B Office Of Adminis

Administrative Law Judges 

after receipt of a complaint or 

on the Commission sown motion

Administrative Law Judge

administer oaths and affirmation

offers of proof and receive rele

depositions to be taken whenev

be served thereby regulate the 

conferences for the settlemen

issues by consent of the par

requests or similar matters 

decisions and take any other 

rule consistent with the Admini

At the beginning of fisca

were pending before Administrat

year 155 cases were added w

remanded to Administrative 

54
proceedings The judges held 

conducted hearings in 10 ca

decisions in formal proceeding

informal proceeding and 151 

docket applications

Cases otherwise dispose

proceedings and one special d

2 Commission Action

The Commission adopted 3 f

docket decisions Four form

decision and 130 special 

administratively final

3 Decisions of Administrative 

not yet decided by the Co

50 Mile Container Rul

Common Carriers Serving US A

Possible Violations of the Sh

8111

The case involved a collective

in its simplest form pro

supplying shipping containers 

miles of the carrier spier un

loaded

Association

by either

or the

members

shipper s

of the

o

own facilities Against charg

rule violated both the Shippin

Act 1984 it was held that ne

opposed to the rule had demons

Stevens Shipping and Term

State Ports Authority Docket 

Complainant a stevedore o

Charleston South Carolina co

Authority operated the port 

which were unreasonable in v

Shipping Act 1916 The 

required users of port service

to all tariff rules and to in

case of claims against the P

5
owners and their agents liab

Ports Authority were neglig

stevedores renting Port Author

of Ports Authority crane oper

cranes to rent Ports Author

available in preference to p

proceeding arose out of an ac

being lifted at the port by a 

operator was dropped causing 

the premises and subsequent la

Charleston It was held by the 

judge that the user consent pr

had no legal significance th

users to indemnify the Po

liability on vessels owners 

because they could be used to im

Ports Authority facilities even 

negligent that the provision 

renters was not unreasonable b

the right to control the Port 

and that the provision requ

Authority cranes if suitable an

The Ports Authority was ordere

carrying out the unreasonable 

unlawful tariff provisions

The CocaCola Export Corp

Line Docket No 8410

In the complaint case the ship

had exacted a higher rate than 

tariff

improperly classifying the sh

It was held that the c

that the lawful rate had been c

Ariel Maritime Group Inc 

This case was initiated a

Investigation to determine 

corporations as freight forw

violated section 16 Initial Pa

1916 by misdeclaring and misde

56
inaccurate weight or measureme

rate from the shipper under on

lower rate to the carrier un

Violations of section 16 were a

declaring cargo was being trans

not the case The case also 

of section 18b3 of the 

shippers were charged rates 

tariff on file with the Comm

of violations is whether or not 

Carrier International Cor

Corporation Docket No 851

Complainant sshipment of air 

Savannah Georgia the Port Su

subjected to a congestion s

overcharged because the applic

The Commission s authority 

discretionary and under the 

part was awarded

Matson Navigation Company 

Increase of 25 Percent betwee

and Hawaii Ports Docket No 8

Matson Navigation Company Inc 

Hawaii and Pacific Coast ports 

by 25 percent seeking to earn 

its rate base The Commissios

Matson srate of return should 

the State of Hawaii argued fo

argued that the rate increase 

that existed before the increas

administrative law judge found 

not unreasonable that Matson 

return between 1368 and 1369 

that the Hearing Counsel t

underestimated Matson scompe

rates of return relied upon 

methodologies and understated 

judge also found that Matson 

57
subject market area had introd

had made substantial inves

efficiencies all of which f

determining a reasonable rate 

the Commission announced tha

Commission and for other reas

be issuing a final decision an

3 of the Intercoastal Shippin

investigation would therefore 

Judges also issued initia

83 27 83 32 8336 83 41 

Informal Docket No 1469 F

4 Pending Proceedings

At the close of fiscal ye

proceedings of which 8 were i

Commission The remaining p

the filing

by water

districts

stevedores

1 General

of complaints or a

shippers confer

terminal operato

C Office of the 

The Office of General Cou

legal issues and provides it 

under consideration The O

proposed Commission rules 

implement Commission policies 

written opinions on pending 

prepares draft decisions 

ratification The Office of 

responsible for defending and 

court This litigation 

representing the Commission up

orders filed with the Circu

Office also represents the 

5
before other tribunals where 

be affected by litigation 

responsible for preparing 

Congress on various maritime 

following are representative 

Office

2 Commission actions

Financial Reports by Ve

by Water in the Domestic Offs

17 23 SR 355 July 31 1

This

rules

proceeding

governing the

was

filing

initiated

of 

in the domestic offshore trad

financial reporting forms p

Administration for domestic 

those forms by the Maritime A

amendments to the Commission s

In the Matter of the Ind

the Atlantic and Gulf West Coa

Agreement Order Granting Pe

Docket No 85 8 23 SR 3

The Commission issued an orde

determined that neither brok

compensation is a rate or se

of section 5b8 of the Ship

Act therefore does not provi

independent action with regard 

freight brokerage

Matson Navigation Company 

25 Percent Between United S

Hawaii Ports Docket No 85

1985

This proceeding was ini

reasonableness of a rate increa

Company An initial decision 

justified On exception the 

final decision due to an even

from a vacancy on the Comm

were deemed to be just and re

Intercoastal Shipping Act 193

5
Electronic Filing of Tari

Foreign and Domestic Offshore 

Docket No 8435 23 SR 8

The Commission promulgated ru

electronic tariff filing servic

rules provide that carriers 

amendments with registered 

located in the Commission sW

building These services must 

pages with the Commission by 9 0

Publishing and Filing Tar

Foreign Commerce of the United 

by NVOCC s Docket No 842

1985

After soliciting comments fro

Commission issued a rule govern

of non vessel operating common 

requires NVOCCs to indicate in 

engage in coloading with other 

them to notify the underlying 

been coloaded and with whom 

prohibits special rates in an N

loading with other NVOCCs 

raised questions concerning the 

a result the Commission modif

all NVOCCs are required to co

regardless of the type of colo

established with another NVO

amended to clarify that the nam

shipment is coloaded must appe

lading in a clear and legible 

Rules Governing Agreemen

and Other Persons Subject to 

Docket Nos 8426 and 84 32 

The Commission issued a Final 

provisions of the Shipping Act 

by or among ocean common carrie

terminal operator agreements

60
Actions to Address Cond

of US

Flag Vessels To Oce

Docket No 84221 22 SR 

The Commission issued a Final 

13b5of the Shipping Act 

among other things factors w

unduly impairing access of 

trades petitions for rel

definitions and sanctions

Service Contracts Loya

Tariffs By Common Carriers in 

United

SR

States Docket Nos 

1424 November 9 1984

These consolidated proceedings 

the Shipping Act of 1984 relev

carriers and the use of lo

contracts by such carriers 

regulations include substan

governing the filing of th

reduced requirements for the f

intermodal rates and rate 

governing the filing of rates 

controlled carriers Prov

contracts include the filing re

and their related statemen

prohibition against modificati

contracts unless provided fo

establishment of return and r

of loyalty contracts witho

Department of Justice was not 

Commission srules in light 

antitrust laws to such agreeme

Order Denying Petitions 

Nos 8421 84 23 84 26 23 

The Commission issued an order 

reconsideration filed in respo

rules on service contract

agreements

61
Port Authority of New 

Association Docket Nos 846 

1985

The Commission found that the ag

Shipping Association to fund 

unfair and unjustly discriminat

and New Jersey and a carrier in 

Commission modified the agreeme

and unjust discrimination and or

in favor of the carrier in the 

appeals by all major parties 

thereafter entered into a settle

adjustments in favor of the Pue

a new assessment agreement and 

the appeals

California Cartage Co 

Maritime Association Docket No

212 May 23 1985 and 23 SR 

This proceeding was remanded to 

Circuit Court of Appeals The

Association moved to dismiss t

that the standing available 

extinguished by enactment of 

which inter alia amended the 

Act 1980 The Commission deni

the 1984 Act amendments limite

complainants to reparations r

relief they sought The 

reparations remedy and moved fo

case The Commission dismissed 

now before the Court of Appea

filed by Complainants

Application of Bapaq Llo

General Motors Corporation Sp

1225 23 SR 200 1985 A

Lines SA Inc for the Be

Special Docket No 1168 23 SR 

The Commission announced a new 

charge refund or waiver reques

Shipping Act of 1984 the spec

62
reversal of previous policy 

carrier that has negotiated 

shipper but failed through c

covering that service prior to 

otherwise with the jurisdic

special docket procedure spec

prove that it actually provide

contemplated in strict accorda

to file a special docket appl

shipper

In the Matter of Petition 

Policy Concerning the Status o

the Shipping Act of 1984 22 SR 

The American Institute for 

filed a petition with the Comm

that membership and participat

is limited to the owners or b

shipped through the associatio

Petition primarily on the 

statutory provisions togeth

history do not permit the i

AISA subsequently appealed the 

United States Court of Appeals 

Circuit Upon motion of the 

dismissed for lack of jurisdic

Definition of Package 

The Commission denied as beyo

of Dow Chemical Company for 

define package for the purpo

by Sea Act

In the Matter of Petitio

Shippers Associations 22 SR 

Several conferences petitioned 

rulemaking proceeding which 

procedures which would have to 

shippers association prior 

conference having an obligatio

Commission determined that Pe

63
antitrust exposure were not 

justify the proposed rule 

noted that carriers or conferen

tariff rules concerning the s

the Commission denied the Petit

Part 500 Employee Res

Fed Req 44363 November 6 19

The Commission issued a revision 

46 CFR Part 500 This re

the rules governing gifts ent

procedures relating to enforcem

employment activity and made o

changes

3 Litigation

FNC

American Institute for Sh

DC Cir No 851227 1

The American Institute for S

filed a petition for review 

denying its Petition for an 

Concerning the Status of Ship

Shipping Act of 1984 served 

1629 Subsequently in respon

to Dismiss the Court of A

Columbia Circuit dismissed the 

ground that it lacked jurisdict

Puerto Rico Maritime Shipp

Marine Management Inc v FMC 

NO 851129 et al DC C

Five petitions for review of t

FMC Docket Nos 84 4 and 84 6 

parties Subsequently thes

pursuant to a settlement e

agreement

4 Legislative Developments

The primary focus of t

activity during the past year 

Administrative Orders Review A

64
to clarify that all rules 

issued by the Commission wil

United States courts of appe

federal district courts with 

to the courts of appeals 

passage of the Shipping Act 

amendment to 28 USC S 2342

The Commission prepared 

statement and sent them to 

committees The Senate 

Commission sproposed bill as 

Appropriation Authorization A

679 The House did not adopt 

and instead Congressman Rodin

bill will essentially accom

proposed bill originally pro

was referred to the House Ju

subject of hearings held o

Subcommittee on Courts 

Vice

Administration

Chairman submitted

of Justice

a pre

A

the bill The bill was recen

action

During fiscal year 198

Congressional inquiries were 

Legislative Counsel for co

completed on all of these 

Legislative Counsel also prepa

for five Congressional hearing

Pursuant to the requireme

of August 26 1983 Pub L 

Commission submitted to Cong

those laws within the Commis

shipping and maritime matte

this submission in consulta

Counsel of the House of Repre

makes extensive style and o

substantive changes in the bas

6
D Office of Policy Planning 

1 General

The Office of Policy Plannin

is responsible for a wide rang

activities strategic planning 

analysis and information system

in its statutory mission In 

Office ensures that the Comm

developments and can anticipate 

affect liner shipping and the 

activities of the Office include

Monitoring the actions of 

decrees and cargo preferen

shipping in the foreign tra

Providing technical assista

regulatory policy in intrag

government and multi

international shipping pol

Forecasting trade develop

trends and

Analyzing legislative ac

structural changes in the 

influence the environmen

shipping

The Office carries on econom

conducts studies and develops 

the Commission to meet its regu

Office also provides expert 

Commission sformal administra

assigned Office function is re

and coordinating the Comms 

information systems

2 Policy Planning Issues

During fiscal year 1985 a 

development of a systematic p

personal computers into virtua

Commission The need for a

because the Commission receive

tariffs agreements and inves

66
basis In addition the requ

1984 that the Commission cond

impact of the Act means that m

and the Journal of Commerce 

at the Commission and servi

London must be accumulated an

As a result the office d

the requirements for computer 

the Commission sautomation ne

acquisition of 31 personal com

minicomputer the Commission 

shortterm results were that 

computer power significantly w

expenditures The placement o

hands of the ultimate users of 

longterm gains in efficiency f

The office continued 

information on the laws and pra

which could have an adverse im

US trades The Shipping 

Commission s role in ensu

commercial practices do not 

carriers access to foreignt

1365 was included in the Ac

to protect itself from growing 

the United Nations Code of C

UN Liner Code The Of

database on foreign government 

closely with other agencies in 

Departments of State and Trans

interests of the United States 

3 International Affairs

In our increasingly interd

of one nation can affect the 

partner or even a group of 

consequence the Commission m

political and economic even

67
technological developments that 

structure of the liner sh

governments have become more a

cargo sharing regimes through 

pricing decisions and other 

conferences operating in their 

Cargo preference schemes o

in some instances specific c

national flag lines

trading partner

and the 

Usually such 

of thirdflag carriers under 

Commission has broad statutory 

of the Merchant Marine Act of 1

of carriers and shippers in th

authority has been recently 

occasions on the Commissis 

complaints filed with the Comm

The cargo preference sch

also serve to bar the entry o

USflag carriers in the cross 

Shipping Act of 1984 empowe

retaliatory sanctions against 

discriminate against USflag 

foreign trades Specifically 

Commission has the authority 

unfair actions by a carrier 

unduly impair the access of a 

trade between foreign ports an

up to and including tariff s

provision augments and strength

its efforts to preserve 

transportation system and ensu

competitive rates in the liner 

During the year Commis

technical advisors to the Inter

This government policy group 

representatives from the 

Transportation Commerce and J

68
US Trade Representative and 

coordinate US shipping poli

been represented by staff memb

US discussions with Europe

officials in the Consultative 

US and CSG members meet to d

problems facing the internatio

the entry into force of the 

proliferation of cargo prefere

US have continued their dialo

to maintain open and competitiv

trades The Commission has 

staff in bilateral shipping po

and foreign government official

The Commission was actively inv

the field of international aff

These activities are expected 

1986 and beyond The principa

outlined below

4 Restrictive CargoSharing De

Governments

The trend towards cargo 

develop and maintain natio

increasingly evident during the 

this

Code

into

have

the

can be attributed to the 

with its emphasis on c

force

measures

oceanborne

thirdflag

shipping

shippers

favorable

enacted

in October 1983

decrees

one

dis

in the US 

laws

or implemented

cargoes which

carriers

These limitations have i

access to certain trades

lines and also serve

to obtain the best a

rates thereby advers

69

and import commerce Complain

activities have resulted in Co
remove conditions unfavorable 

trades Under section 19 of t

the Commission possesses signi

against unfair acts of discri

and governments See pp 39 42 

The cargo preference sch

also serve to limit the activit

of USflag carriers in the 

Under its new authority contain

1984 Act the Commission can p

enter the cross trades While 

tested it represents a s

Commission s powers to sa

interests To date no petit

section 13b5of the Shipp

representatives from USflag 

assure them that the Commi

protect USflag carriers c

trades Meetings were held w

identify potential trouble sp

be necessary

During the fiscal year 

cargo promotion reporting pro

about the actions of foreign g

complaints and petitions file

under section 19 of the Me

section 1365of the Shippin

contain information on foreign 

laws and decrees implemen

access to cargoes indire

countermeasures available in 

against nationalflag or fore

trade

5 USConsultative Shipping 

During the fiscal yea

participated in the discussio

CSG During these meeting

7
preparatory sessions of the US 

Group Commission representat

on pertinent matters under dis

6 Bilateral Negotiations

The liner shipping polic

developed and developing coun

of occasions in the past few y

activity in the area of gove

negotiations and discussions 

served as technical advisors 

in Washington DC during Ja

these meetings was to disc

Japanese road restrictions o

containers the lack of parti

in the movement of both US 

and Japanese automobile expo

intermodal and port service 

operators See pp 35 36

7 Foreign Maritime Laws and R

The Commission has contin

reference files on foreig

regulations and regulatory s

updating its files on coun

Commission can more readily 

and conflicts arising with 

Commission is continuing to 

EEC s Proposed Regulation on 

maritime regulatory activitie

countries This year the 

foreign nations tariff fili

Diplomatic and consular pos

solicit responses from foreign 

regarding tariff filing requir

were received and are being a

7
8 Information Resources

The information resources 

major component of the Offic

International Affairs The fu

planning and coordination of 

efforts of the Commission 

microcomputer technology the co

processing operations to th

divisions was adopted The r

Commission potential size of d

style at the Commission all co

decentralize A comprehensive 

and telecommunications was imp

1985 The Commission sobjec

equipment and data base respo

who need the information most 

been met Systems analysis 

comprehensive training of Co

undertaken during the coming 

efficiencies flexibility and 

through automation

Microcomputer equipment i

section 18 study a major Com

the Shipping Act of 1984 the 

charged with collecting vast qu

the effects of the 1984 Act 

services freight movements 

undertaken to protect US 

commercial practices and undue 

liner shipping To the great

being accomplished by automated 

commercial and internal databas

now in place or soon to be co

regarding service contracts 

agreements

Office automation efforts 

the installation of additiona

equipment for word processing 

72
information processing Eq

Commission and at the Miami 

The equipment includes the 

transfer documents between the

9 Section 18 The Mandate fo

effects of the Shipping A

to Date

a General

Within six months after 

period of data collection th

information with an analysis 

Congress to the Advisory Com

Shipping Advisory Commis

FTC The Advisory Commissi

time The three aforemention

their own analyses on the im

the FMC submission

The Act further specifie

following three topics shou

analyses

The advisability of adop

on volume and mass of sh

t

The need for antitrust 

terminals and

The continuing need for 

tariffs be filed and enfo

The Advisory Commission 

comprehensive study of 

concerning conferences in oce

specifically address whether t

by prohibiting conferences 

conferences The Advisory Com

after its establishment m

Congress

7
b The Data Collecting Ta

From the FMC s perspectiv

involves three major areas of re

the collection of data the sec

with the D03 DOT and FTC conc

the third is the analysis of the 

the impact of the 1984 Act o

industry

c Consultation with Other 

Sources of information av

include tariffs and service co

material such as exchange 

International Monetary Fund B

information requested from car

The choice of data to be collect

years before and after the Act d

obtained from the various sources 

analysis It is expected that th

will be adopted by the FMC will 

the approach of the other agen

intention of Congress to allow fo

forming an Advisory Commission 

things is to evaluate the sepa

of data was clearly intended to 

of activity by the separate agen

d FMC Progress to Date

i General In February 

that section 18 was likely to b

Act of 1984 the FMC prepared a p

which identified the major area

Progress in fiscal year 1985 is 

list of major areas

Establish and maintain 

representatives from th

Identify major issues a

Work with the shippi

sources of information 

74
Research the us

statistical procedu

collected data

Continue the data c

ii The Interagency Gro

held its initial consultativ

Interagency Group on June 8 

were held in FY 1984 and s

1985 Although a wide range 

confidentiality problems o

interpretations of what Cong

the discussions have becom

regarding the nature of the in

the information requirements 

fulfilling their reporting 

expected to continue during F

iii Identify Major Is

initial assessment of the data 

sections 18a2 and 

the conceptual issues and p

collection pursuant to each 

tasks continue to be assigned 

the need for a more integra

during FY 1985 The need ar

desire to automate the data 

following the establishment 

from the concern that all pe

and compiled now rather than 

information is no longer curr

iv Work with the Ocean 

arrangements were made to es

arrangement among carriers to 

information for the section 18 

be particularly important fo

which the carriers are cons

source such as information 

through rates and stowage fa

also be useful as a verifying 

7
FMC sourced Similar arrangem

port representatives and 

information can be exchanged ea

v Analytical and Statis

1985 several documents were 

outlining the statistical m

followed After further discu

documents will be expanded to in

and information system procedur

all data series collected for th

vi Continuation of Da

interest during FY 1985 was the 

for the following major cou

were selected for the section 18 

Australia

US West Coast to Austral

OS East Coast to Austral

Australia to OS West Coa

Australia to US East Coa

Brazil

US Gulf to Brazil

OS East Coast to Brazil

Brazil to OS Gulf

Brazil to US East Coast

Italy

US North Atlantic to Ital

Italy to OS North Atlant

Japan

US West Coast to Japan

OS East Coast to Japan

Japan to OS West Coast

Japan to OS East Coast

Netherlands and Germany

OS North Atlantic Ports t

OS South Atlantic Ports t

Netherlands and Germany to 

Netherlands and Germany to 

Taiwan

US West Coast to Taiwan

OS East Coast to Taiwan

Taiwan to OS West Coast

Taiwan to OS East Coast

76
Details concerning the proced

rates are given in Appendix I

Other important data w

1985 include market shares fo

conference carriers An exa

been prepared appears in App

to survey shippers carriers 

opinions relating to the Act 

FMC was awaiting OMB appro

instruments to associations 

industry

10 Future Plans and Proposed 

For the coming year the 

efforts to collect and analy

year study mandated by the 

expected that freight rate ind

be completed These index

updated for the remainder of 

anticipated that an analys

geographic regions for calend

For the sake of comparison 

East trade should be finalize

independent lines should be 

1984 and 1985 It is ant

Resources Program will also 

coordinator for data bas

implementation with the futur

area network for information 

In the area of internat

that the laws decrees a

countries will be compiled a

bases Continued participatio

in bilateral discussions is a

A major portion of the 

few years will involve the 

study required by section 18

7
E OFFICE OF REGULA

The Office of Regulatory O

early fiscal year 1985 co

finalization of the Commissios

the Shipping Act of 1984 which 

by December 1984 In additio

statutory requirements the C

updated all of its parts of the 

and as a result of this effort 

End was published in April of 1

in order to produce rules o

the 1984 Act within stringent 

established novel procedures w

possible These included s

drafting of new rules quality 

monitoring of progress to co

Regulatory Overview was establis

these important functions for th

In addition to the final ru

Federal Regulations the Offi

coordinated the development of t

copies of each CFR part with ame

were finalized

The Office of Regulatory 

and proposed Commission rules 

their effectiveness and compa

policies and regulations of 

advises and consults with o

regarding necessary or de

regulations ensures the c

procedures with new and existing 

acts as liaison with other Go

Commission compliance with the

rulemaking requirements In F

drafted and circulated to Comm

Administration goals and a rule

manual to facilitate drafting o

78
compatibility with Adminis

Register style

Regulatory

The Office

Calendar

maintains

which

an

semiannual submissions of re

of Management and Budget to 

Agenda which appears in the 

were made in February and Aug

After the identificatio

the status of which is upda

monitoring the Office of R

all changes to existing and 

in accordance with Administ

drafts and edits recomme

promulgation including mod

Year 1985 30 rulemaking pro

andor drafting and 21 rules 

Register out of which 16 

different CFR parts

In Fiscal Year 1985 the 

in consultation with the Offi

the Commission sdraft of the 

of Title 46 of the United St

be submitted to Congress in 

with other chapters of Title 

during Fiscal Year 1986 The 

also performed special draftin

1 General

F DIRECTOR 

This Office is resp

coordination

four operating

and

Bureaus

management

the

Monitoring the Bureau of 

Hearing Counsel and the B

through the Shipping Act of 

7
completely transformed the Com

s

the maritime transportation ind

this new law it became n

Commission sresources and c

consistent with the Commission s

Operating plans have been 

responsibility assigned to 

establishing specific goals and 

attention has been given to s

programs and improving efficie

handling of agreements tariffs 

2 Accomplishments

Principal accomplishments fo

Developing procedures to ex

through emphasizing prio

matters reducing the age 

number of less signific

establishing better coordin

Developing more aggressive 

docketed proceedings

Improving efficiency in pro

service contracts and ant

Identifying tactics to ensu

the 1984 Act

Designing and implementing 

trade surveillance progra

regulated parties were mee

requirements

Finalizing rules to impleme

3 Plans

Major plans for FY 86 include

Implementation of continuin

program

Development of economic cr

and enforcement activities

Pursuit of tariff automatio

80

Automation of freight forw

and passenger vessel proce
Revising the program for m

to attain better efficienc

4 Tariff Automation

This Office played a major 

in the Commission s project t

the automation of tariff filing

paper filings continues to grow 

copy filings is expensive a

Commission and for the ind

exploring the feasibility of 

perspective of satisfying the 

tariff information as well as 

needs This will remain an im

1 General

The primary function of t

and administer the programs 

concerted actions of common 

persons within the definitions 

and the Shipping Act 1916

2 Surveillance

G BUREAU OF AGREEMENTS 

See pp 22 26

3 Types of Agreements

a Conference and Ratem

Conference and ratemakin

collective discussion agreeme

freight rates and practices 

Such agreements are limited t

route with the traditionally 

conference and rate agreem

agreement is usually a more fo

dominant influence on rates 

rate agreement is more loose

influence on rates However 

8
blurred as evidenced by two ma

trade within the past year wi

Pacific Westbound Rate Agreeme

Eastbound Rate Agreement As 

agreements encompass the trade 

trade from Japan of 16 previou

major carriers serving the Far 

structured than the previous c

dominant influence on rates w

Commission srules currently 

conference and rate agreements 

applicability of the socalled 

During fiscal year 1985 

processing of 230 conference a

amendments to existing agreem

Act of 1984 The most sig

merging of 37 conferences a

conferences and rate agreeme

number of conferences and rate 

mergers took place in the Eu

the Far East trades

Twelve conferences enlarg

to encompass a broad range o

United States and oversea

agreements were completely re

comply with the Commission sf

Only 12 conference agreements h

by the end of the year and 

extensions of the October 1 19

b Pooling and Equal Ac

Pooling agreements are 

carriers in given trades which 

apportionment of cargo and or 

the increased efficiencies w

provide as a result of their 

conditions These agreements 

requirements and other features 

82
efficiency Equal access ag

national flag carrier access to 

the governments of reciprocal 

of cargo preference laws 

restrictions

At the conclusion of Fisca

pooling agreements three equa

combined poolingequal access 

preponderance of these agreeme

USSouth American trades E

have a significant impact on US 

Argentina Brazil Chile and C

c Space Charter Agreeme

Space charter agreements 

cross chartering of vessel spa

or among vessel operators 

arrangements of this type is to 

vessel accommodations in give

which would otherwise be a

rationalization of overall fle

overtonnaging in given trad

generally contain authority 

itineraries and the exchange o

In terms of non confer

activity the area of space c

the largest growth of any s

during Fiscal Year 1985 regis

agreements of 63 percent ove

Fully 88 percent of new space 

69 percent of all space charte

both basic agreements and mod

1985 required staff negotiation

statutorily impermissible aut

terms to meet the speci

Commission srules including 

authority or to informally d

to assess the likelihood andor 

8
in transportation service res

rationalization authority I

these negotiations met with 

agreements involved were perm

expiration of the initial perio

1985 there were 44 active spac

d Discussion Agreements

Discussion agreements pro

ocean common carriers or co

exchange views and recommend a

concern Discussion agreement

authorize the implementation 

actions concerning matters disc

for 1984 Act effectiveness 

Year 1985 there were 15 such a

e Joint ServiceConsort

Joint service and con

establish a new and separate li

by otherwise independent liner 

in a given trade The result

generally as a single carr

publishing its own tariffs an

lading but its authority is st

is specifically set forth in t

operation

The 1984 Act significantly 

carrier ratemaking activitie

conference agreements with t

serviceconsortia agreements 

serviceconsortia agreements 

carrier agreements with ratema

required to have the soca

concerning independent acti

requests and complaints etc 

other carrier ratemaking agre

regulated as conferences und

reason and in view of 

84
serviceconsortium agreemen

competitive activity in a m

subject to the checks and 

conference provisions but wh

tangible transportation service 

identifiable on a preeffectiv

agreements

Year 1985

agreements

all joint

agreements

was subjected to 

Every one of the 

filed during the F

serviceconsortia 

and modifications 

negotiations on a wide varie

concerns that agreements with 

a joint serviceconsortium 

definitions in the Commissios

to evade otherwise applicable 

need to remove open ended 

identify the resources contrib

informed assessment of 

service cost impacts under the 

the 1984 Act Although staff 

generally successful during t

was necessary to extend the 

fortyfive days in two insta

jurisdictional questions in the 

At the conclusion of Fisc

and consortia agreements were 

every major US foreign trade

f Marine Terminal and S

Marine terminals operate

entities provide the fac

interchange of

the receipt

consignees

Commission

Absent some

court action they

filing

cargo between

and delivery

la

Agreements ent

operators are still require

however they no 

intervention

become

by 

eff

85
During fiscal year 198

completion 177 agreements 

providing for the use and pr

services and facilities

The Commission is also c

labor management agreements pu

Agreements Act of 1980 PL 

Act provides that such agre

provide for the funding of c

benefit obligations on other t

regardless of the cargo han

equipment utilized shall be 

with the Commission During 

management agreements of this t

1 General

H BUREAU O

The Bureau of Tariffs pla

analyzes programs and activit

pricing of services provided 

conferences of such carriers a

foreign and domestic offshore c

reviews files and rejects 

disapproves special permission 

recommendations collaborating 

Counsel and other elements of 

for formal action and proceed

Bureau is also responsible 

freight forwarders under the p

of 1984 and under Public Law 

the financial responsibility 

passenger vessels to satis

nonperformance of voyages or re

The Bureau develops long ran

policies and standards and 

respect to its program activiti

86
A significant development 

the abolishment of the Offic

transfer of such functions to t

Activity in the domestic comme

administrative standpoint it 

functions could be combined

2 Rulemakings involving Tariff

During the fiscal year 

rules for the publishing and 

24 and service contracts and 

21 These rules further modi

pertained to tariff content a

intermodal tariff filing requir

timevolume rates The signi

filing rules prompted by the 

the addition of service cont

forest products recycled m

paper waste and the elimi

breakout in intermodal th

addition the time for fi

overcharges was increased fr

provision extending tariff no

rebate policy to NVOCCs was 

correction numbers in tariffs w

The Commission also publis

No 84 27 relating to the prac

Common Carriers NVOCCs comb

purpose of attaining full con

being commonly known as colo

tariff filing regulations to r

in its tariffs the undertak

Further the rule requires that 

a shipper that its cargo has 

identify of the other NVOCC s 

Such notice must be shown on th

in a clear and legible mann

prohibits NVOCCs publishing sp

use of other NVOCCs The fin

September 5 1985

87
During fiscal year 19

Commission published its fina

1985 which amended its foreign 

filing rules by permitting s

the electronic receipt of 

Commission s offices but wi

offices are located

Also during the year 

American President Lines the 

85 19 Free Time and Detention 

Equipment Interchanged with S

proposed rule would revise 

domestic offshore tariff fi

publication of free time and d

a carrier s equipment intercha

agents The Commission staff 

proposed rule and is in t

recommendation to the Commiss

3 Foreign Commerce

In fiscal year 1985 the 

increased by 20443 or appr

number of official tariffs 

approximately 10 percent over 

During the fiscal year 

program to place cancelled 

permanent record keeping purpo

transfer of such files to gove

addition cancelled pages to 

transferred to fiche due to 

tariff library By the 

approximately 3 million cance

cancelled pages had been record

tariff activity is summarized 

4 Foreign Controlled Carrier A

During the first half of t

added Flota Bananera Ecuatoria

common carrier and Sudan Sh

the Government of Sudan to its 

88
During the third quarte

petition from South African 

Safmarine requesting that 

Commission slist of controlled 

be relieved from the advanc

requirements of section 9 of 

Processing of the petition was 

the information submitted by Sa

Department of State Final 

expected to be taken early in f

Also continued under rev

controlled common carriers are 

of the Philippines Philippin

Republic of Nauru

5 Compliance and Surveillance 

See pp 2226

6 Significant Activities within 

a European Area

A significant change took 

area The US AtlanticNorth 

North EuropeUS Atlantic 

consolidating approximately 1

Atlantic European Conferences 

action resulted in all trade a

conference tariff outbound a

inbound

Regarding rate activity in 

noted that in fiscal 1985 

implemented one general rate 

conference implemented two

b Far East Area

The Transpacific Westbound 

formed in fiscal 1985 covering t

and Points in the United Stat

Southeast Asia Singapore Mala

the Philippines The agree

89
carriers who had approximate

file prior to their joining T

involved in the filing of the 

the cancellation of the mem

TWRA common conference tariff 

May 1 1985

In addition to a ne

representing the outbound tra

Asia North American Eastboun

created representing the trad

Japan to the United States 

independent tariffs that fal

been adopted by the agreem

publish common tariffs enco

tariffs of the participating 

carriers

7 Proposed ADP Index and Rel

The Commission is contin

an ADP index of all tariffs in 

system is established it will 

the name of every carrier with 

scope of each carrier s op

tariff and the name of all 

conference or agreement tarif

a complete and continually u

printout of all tariffs on fil

In addition the Comm

placing certain service contra

order

responsibility

to develop

in monitoring

a data bas

8 Non Vessel Operating Commo

Commerce Subject to A

Requirements

The Commission served a 

1985 Docket 85 5 on the NV

their initial anti rebate c

1984 The matter is curren

Commission See also pp 15 1
9 Service Contracts

The Shipping Act of 19

shipping statutes in the fo

States which permits carriers 

service contracts with shipp

Except for service contracts 

products recycled metal scr

each contract entered into 

Shipping Act of 1984 must be 

Commission and at the same t

essential terms must be filed 

available to the general p

essential terms must be avai

situated

While the

contracts between

1984 and the end

1985 over 2100 service

contracts were filed by 55

that entered into service

conferences in fiscal year

Commission 

the effecti

of fiscal 

manufacturers wholesaler

associations and NVOCCs

c

in

and 21 conferences They 

primary and secondary shippe

person or firm signing a ser

shipper is a person or firm i

subsidiary or affiliate of the 

receive services under the 

9

The service contracts 

described commodities and 

freight allkinds The geo

include the US Atlantic 

specifically describe points i

and ports in the Far Eas

Europe Scandinavia Africa C

in the inbound and outbound tr
At the close of the fiscal 

contracts filed was increasing 

anticipated that the increased 

fiscal year 1986 In cert

contracts cover a significant p

The Commission implement

governing the use of service c

our experience with service 

regulations may require amendme

not originally contemplated 

intends to enter into a rulemak

to accomplish this purpose

10 Domestic Commerce

The Intercoastal Shipping 

of the Shipping Act 1916 re

charges and rules describing 

carriers in the US domestic o

require the Commission to e

practices of domestic offsho

reasonable The staff reviews 

of such common carriers in the 

between the US Mainland and 

Rico American Samoa US Virg

Wake and the Northern Marianas 

in the United States are als

showing their rates and practic

a Tariff Activity

The Bureau of Tariffs has 

tariffs filed by 345 carrier

filed by 325 terminal operato

12000 domestic tariff revision

revisions filed during the ye

permission applications were pr

a vity Statistics are summar

At the beginning o

contract filings were averaging 

of the fiscal year this had in

92
b Significant Commissio

See pp 27 471

11 Financial Analysis

The Office of Financial 

and financial expertise to he

rates for the transportation 

provided by common carriers 

commerce of the United State

technical assistance to o

Commission

The Office continued t

carriers in the domestic off

States This effort involve

financial and operating data s

CFR Part 552 The staff also 

submitted in support of a g

Virgin Islands Trade

The Commission requires 

reports from vessel operato

offshore trades Work was c

governing regulations and the 

self propelled vessel operat

project the Office has unde

respect to the reports of 

Together these changes will 

regulatory burden imposed on 

offshore trades

Under the direction of t

Office undertook the deve

membership listing of conferen

commerce of the United State

period January 1 1976 to Se

entry and exit dates as well 

The Office has devoted 

substantial

This activity

efforts

includes

to the

the

Cos

d

9
various data bases These data 

person index as well as profile

contracts on file with the Comm

12 Freight Forwarders

The ocean freight forwardi

persons who in effect hold th

export departments for hire Oc

export shippers by arranging for 

cargo by common carriers and 

legal requirements safety 

incidentals related to such 

forwarders receive payment for 

from the exporter Forward

compensation from the ocean 

selected by the forwarder to ca

Congressional findings 

malpractices within the ocean 

led to the enactment of section 

46 USC 841b which vested t

for the licensing and regula

freight forwarders At that 

export trades were rampant 

maintaining a favorable clim

especially small businesses wh

their own exporting Congress 

limited oversight of ocean frei

to eliminate secret illegally 

ensure that unscrupulous in

irresponsible persons were preve

freight forwarders Although 

forwarders has increased sinc

malpractices are now more the 

rule

The continued maintenance 

technical qualifications and fin

ocean freight forwarder are cu

license issued by the Commissio

94
In addition to application

year 1985 the Commission re

applications requesting approv

and other organizational chan

transfers and other organizatio

from the previous fiscal yea

these requests were approved 

Sixteen requests were adminis

did not wish to pursue their re

Onsite compliance investi

of the Commission seffort to 

freight forwarders comply w

shipping statutes and the Coms

the year one hundred twenty tw

reviewed Sixtyone of the

issuance of warning letters o

Hearing Counsel for the asse

penalties Sixty one cases w

formal corrective action

Other activities during th

The processing of 891 sur

bonds riders to bonds an

The review and processin

concerning in the majo

of freight charges by forw

The receipt and rev

certifications required 

pursuant

implementing

to

regulations

the 1984 

The review of 32 Dunn and 

The

2

review of 64 cla

000 that were file

With regard to the forwa

program during the past 

instituted a formal hearing 

forwarders who failed to file 

The proceeding was dismissed 

active complied by filing the 

9
required to be maintained on f

issued a license need not be 

bond depends upon the number 

ocean freight forwarder provi

services

With the enactment of th

Commission sregulatory respo

industry are now found in sect

new shipping statute the 

remain essentially in place 

export shippers from receiving 

Thus any person that is 

partnership may receive a 

However licensed forwarders 

compensation from carriers 

forwarders may have a beneficia

The new statute also prov

forwarders in the domestic of

States are not required to ob

are such entities required 

Nevertheless such forwarders 

applicable sections of the 1916 

the domestic trades of the Uni

Under the new statute 

forwarders engaged in the fo

States are no longer requ

Commission for approval 

afforded no antitrust immuni

During fiscal year 1985 

hundred fiftytwo applications 

licenses in addition to the 

from Fiscal Year 1984 One 

applications were approved 

withdrawn during the process

incomplete applications were 

One hundred thirtyseven pre

revoked primarily because the 

the surety bonds required by s

9
At the end of the year 

freight forwarders represen

from Fiscal Year 1984

13 Passenger Vessel Certific

The Commission is r

sections 2 and 3 of Public 

e

regulations

which have

found

been

in 46

impl

CFR 

Protection of the Public O

of American and foreign ves

accommodations for fifty or 

passengers at United States 

are financially responsible 

they incur for death or i

persons on voyages to or 

second to indemnify passeng

fares in the event that th

cruises

means

as a

Persons must qualify sep

of insurance

self insurer

financial responsibility

certificate

surety bo

A dif

m

9

Section 2 of the law 

CFR 540 24a contains 

amount of coverage required 

based upon the maximum numb

aboard the vessel A perso

section 2 and the Commiss

Certificate Casualty

Section 3 of the law plac

Commission to determine the a

indemnification of passengers 

of transportation Such fac

capacity itinerary fare st

cruises trade served type 

and collection policy are co
determining the amount of 

responsibility required for a Ce

Under the Commission sregu

3 the maximum amount of 

responsibility required of any 

dollars except a selfinsurer w

amount Each certificant subm

coverage must report unearned 

sales to the Commission Som

passenger revenue were received 

necessary certificants increas

evidence of financial resp

Commission srequirements The 

financial statements from cer

documents such as surety bonds 

A person meeting the require

Commission s regulations is 

Performance

The certificates must be pre

Customs officials at the port o

vessel from the United States 

Customs Service shall refuse cle

does not have certificates on b

Commission confirms compliance w

During fiscal year 1985 th

applications for performance 

applications for casualty certif

for amendments to existing cert

year over 100 vessels remained 

I BUREAU OF BEA

The Bureau of Hearing Co

counsel in formal adjudicatory 

investigations rulemaking proc

Commission Order and other pr

Commission Bureau attorneys 

98
where intervention is perm

proceedings instituted under se

Act and section 11 of the 1984 

the formal proceedings in which 

party the Bureau monitors all 

order to ascertain that major 

industry andor the general p

purely private disputes between 

adequately developed On reque

advice to the staff and the sh

the Bureau may participate in m

or against the Commission 

enforcement reports develop

Investigations prepare and s

compromise and settle such civ

violations of the shipping st

settlement is not reached the 

formal Commission proceedings 

assessment of such penalties

At the close of fiscal 

violations were pending final 

fiscal year 1985 32 new report

by the Bureau and 85 were 

administratively closed or re

or action by other Bureaus 

violations were pending final 

The amounts of civil penalties 

the Commission in fiscal 1985 a

As of the close of fiscal 

formal proceedings pending 

proceedings were received and 9 

23 formal proceedings on hand a

Bureau provided advice to t

projects during the fiscal yea

The Bureau also participat

the development of Commission r

99
During fiscal year 198

developed for the Bureau Th

in fiscal year 1985 and streng

as legal advisor to the Comms

closer coordination with the 

Offices

enforcement

especially

and other

in

regulato

car

Shipping Act of 1984

J BUREAU OF I

The Bureau of Investig

commerce of the United Stat

illegal rebating and other 

shippers consignees and o

Shipping Acts In addition t

Washington DC offices ar

Francisco New Orleans Chicag

Rey Puerto Rico These offi

within their geographical are

Commission and the maritime 

public monitor and conduct s

shipping industry to determine 

shipping statutes maintain a 

wide conditions and investiga

statutes and regulations adm

Such violations can include 

following

Carrier and shipper ma

rebates of freight cha

misdescription or misdecl

Unlawful common carrier 

domestic offshore trades

Unlawful agreements amon

subject to the Commissios

Unlicensed ocean freight 

10
Fiscal Year 1985 was the f

under the Shipping Act of 1984 

and effective on June 19 19

Shipping Act 1984 on surveilla

regulated industry has caused th

the Bureau of Investigations in 

strategies in these areas Th

has as a result revised its 

Fiscal Year 1986 to incorporate 

for monitoring and surveillance 

freight forwarders and non vesse

as well as its investigative a

Acts outlined in the Shipping A

The Bureau of Investigation

on the utilization of sophistic

sources as a means of proper

industry This has enhanced o

resources and develop high pr

have the greatest impact on fu

Bureau and the Agency

At the beginning of Fisca

field investigations in progres

investigations were initiated 

and scheduled for investigation 

totaled 289 leaving 181 cases 

fiscal year Appendix F 

investigative activities

101
1 General

V

ADMINISTRAT

Several offices of the 

administrative support of 

programs

A Office 

The Office of Personnel 

management programs inclu

employee training and develo

occupational safety and heal

these efforts the Office 

officials and employees to 

program and officials need

these functional areas during 

below

2 Program Development

During fiscal year 198

program to provide comprehen

services to its employees 

program makes professional he

short term basis free of ch

during this period was c

implementing a comprehensive 

compensation system for Comm

supervisors Performance Mana

Efforts continued in the 

the capabilities of Federal 

and administrative payments 

efforts the Commission has 

another agency to provide thes

13000 less than the amount 

and administrative payments a

1
Current programs inc

governing employee details 

the Senior Executive Serv

Commission advisory committe

year 1985 During fiscal ye

monitor actions taken and le

the US Office of Personn

contemplated regulatory chang

force performance apprais

system Where new regulatio

collaborated with staffers 

directed policies and proce

year 1985 the Office underw

aspects of its personnel 

conducted by the US Office 

3 Employee Relations

Significant accomplishm

relations during fiscal 1985 

Continuation of effo

environment of all 

numerous programs relati

Conduct of a compre

employees the opportun

facilities prior to mak

purchase of health insur

Continuation of counsel

contemplating retiremen

them to participate in a 

Advice to employees on H

account restoration pro

number of timely health 

safeguard employees we

Assistance to employees 

applications for disab

onthejob injury compe

Initiation of the Coms 

NAVIGATOR which served 

employees on a wide vari

Continuation of efforts 

responsibilities in the 

conduct awards and dis
Informal counseling of s

particular problems which t

Coordination with Commissi

that employees affected 

disciplinary adverse actio

rights

104

Administration of the Cos

Program granting awards t

performance or special ach

4 Performance Appraisal

During fiscal year 1985 

Commission sfirst annual perform

under the statutorilymandated 

Recognition System PMRS In 

and developed common standa

managerial employees and assist

new or revised performance 

changes in employee duties P

conducted for nonPMRS employe

were comprehensively examined 

correct deficiencies in employee 

plans were developed to revise t

as a result of changes in govern

5 Staffing

In addition to ongoing 

fiscal year 1985 the Office resp

recruit to fill newly establishe

offices whose missions were dir

of the Shipping Act of 1984 

passage new recruitment stra

traditionally hardtofill pos

on the feasibility of effecting 

meet critical program needs 

human resources within funding 

use of summer employment v

education programs The Office 

the establishment of an advisor

of studying the possibility of 

tariff filing system In ad
ability

several

to

experts

carry out

and

its

consultant

respo

Act of 1984

6 Training

The Commission continued 

year 1984 to train employees 

Among the training accomplishme

On site aptitude testing e

made training programs 

computer literacy trainin

plan

Presentation of an on si

computers training course 

managers evaluation and 

instruction and handson 

headquarters employees in m

In all approximately 75 of 

received formal training during 

7 Position Classification

During fiscal year 1985 

efforts to describe newlycreate

work in realigned organization

its analysis of positions in co

for employee promotions Fo

evaluation statements were pre

with supervisors to discuss a

approaches to enhance certain p

1 General

8 Office of Budget and 

The Office of Budget 

administers the Commission sf

and is responsible for op

Commission sphysical fiscal 

Office is charged with interpret

financial policies and progra

budget justifications for submis

105
Office of Management and 

administers internal control 

travel and cash management p

2 Objectives

The objectives of this O

Submit annual budget ju

OMB and the Congress

Execute the budget to 

properly expended

Prepare regular financ

decisions

Administer the contro

employment

Collect all fees and fo

Process payments to 

expeditiously as possib

Make certain resources 

fraud waste and error

Process travel orders a

time limits and

Review internal controls 

ensure they conform to e

procedures to correct de

3 Achievements

During fiscal year 1985 

Participated in a review 

the years 1982 through 

calculations to correspo

the Office of Personnel 

Participated on the tas

evaluate the capabilitie

provide personnel proces
Drafted a revised Commiss

Evaluated the costs of 

provided by the agency 

accordingly

Fine tuned the electronic 

and penalty payments in 

deposits to the US 

paperwork burden

Improved processing of 

optimum utilization o

discounts and to elimina

problem payments

Provided management with 

positions in grades GSGM 

Reviewed and commente

guidelines

Participated in the tarif

Monitored workyears obli

conformity to amounts app

Collected and deposited r

collections freight fo

certification fees

Developed proposed proced

collecting debts owed th

employees and

Managed the Commission s

4 Prognosis

During fiscal years 1986 

continue to update financial 

financial management system i

and pursue initiatives leading 

budget and financial operation

1
108
APPEND

109
11

Formal Proceedings

Rulemakings

APPEN

COMMISSION PROCEEDING

Decisions 

Reconsiderations 

Discontinuances Dismiss

Not Reviewed 

Remand 

Final Rules Issued 

Discontinued 

11

Special Dockets 

Informal Dockets 

Oral Arguments 
APPEN

AGREEMENT FILIN

FISCAL Y

Agreements Filed in FY 1985 in

Foreign and Domestic Commerce 

Terminals 

Labor Management 

Agreements Processing Categori

FortyFive Day Review 

Shortened Review 

Exempt Effective Upon Filing 

Determination of No Jurisdictio

Formal Extension of Review Pe

Conference Reports Submitted f

Shippers Requests and Compla

Minutes of Meetings 

Pooling Statements 

Operating Reports 

Index of Documents 

Consultations 

Agreements on File as of Septe

Conference 

Interconference 

Pooling Equal Access 

Joint Service 

Sailing 

Transshipment 

Cooperative Working Charter 

Terminal 

Labor Management Agreements 

11
Tariff Publications

APPEND

TARIFF FILINGS AND STATU

Tariff Filings Pages

Foreign Filings 

Domestic Filings 

Terminal Filings 

Foreign On Hand 1084

On Hand 1085

Investigation and Suspension Me

Domestic

Service Contracts

114

Foreign Rejections 

Domestic Rejections 

Domestic On Hand 1084 

On Hand 1085 

Terminals On Hand 1084 

On Hand 1085 

Special Permission Applications

Total Received Foreign 

Granted 

Denied 

Withdrawn 

Total Received Domestic 

Granted 

Denied 

Withdrawn 

Completed 

Pending 

Filed 
APPEN

CIVIL PENALTIES AS

FISCAL Y

Agromar Lines 

Aloyd Forwarding Inc 

An Mar Project Int l

Arrowpac 

Baltic Shipping Co 

Barber West Africa Line 

Central Shipping 

Compagnie Maritime dAffrete

Constellation Line 

Dependable Hawaii Express 

East Asiatic Company Ltd 

Franklin Export Trading 

FX Coughlin Co 

Harbour Link Int lInc 

Hawaiian Marine Forwardin

Hoegh Line 

Ivarans Line 

James J Boyle 

Kam Container Line USA

Korea Shipping Corp 

L I Shipping Services 

Latinvan 

Manufacturers Export Servi

Ned Express Lines 

Miami Valley Transportatio

Mitsubishi

Ocean World

Warehouse

Cruises

T10

Randy Express Inc 

Schenkers Int lForwarder

Shipping Corp of India 

Target Shipping Inc 

Yang Ming Transport 

11
APPEND

FIELD INVESTIGATIONS 

Investigations TOTAL M

pract

Pending 1084 171 7

Opened FY 1985 299 11

Closed FY 1985 289 9

Pending 93085 181 9

116
APPEN

STATEMENT OF APPROPRIATION

FOR THE FISCAL YEAR EN

Appropriations

Public Law 98 411 approved 

For necessary expenses of 

Commission including serv

by 5 USC 3109 hire of 

vehicles and uniforms or 

as authorized by 5 USC 

that not to exceed 1500 

for official reception and 

expenses 

Obligations and Unobligated Ba

Net obligations for salarie

the fiscal year ended Septe

Unobligated balance returne

Statement of Receipts Deposite

the Treasury for the Fiscal Ye

Publications and reprodu

Fees and Vessel Certifica

and Freight Forwarder App

Fines and penalties 

Total general fund receipt

117
EXHIBIT H EXAMPLE 

OS PACIFIC COAST 

TRANSPACIFIC FREIGHT CO

January D

by tonnage by conferen

Conference Operator

C1 

C2 

C3 

C4 

C5 

C6 

C7 

C8 

C9 

C10 

C11 

C12 

C13 

C14 

C15 

Conference greater than 1

Conference less than 1 

Conference Subtotal 

Nonconference Operator

NCI 

NC2 

NC3 

NC4 

NC5 

NC6 

NC7 

NC8 

NC9 

NC10 

Nonconference greater than 1 

Nonconference less than 1 

Nonconference Subtotal 

Not Elsewhere Classified Sub

Percent calculations based 

subtrade

1
APPEN

PROCEDURES FOR COMPILING TARIF

Calculating the Ta

Tariff rates typically 

depending on the physical cha

or the customs and practices 

and shippers The major rate b

FCL per full con

Weight per pound 

Measurement per 

foot

Weightmeasurement 

revenue

There are many possible variatio

bases One rate may be quoted 

and for another weight based 

149 50 per 1000 kilograms S

either a lump sum or a set o

9550 per 2000 pounds for a 

30000 pounds and 9250 per 

container weight of 35000 p

variations which may occur 

packages of a specific commod

in volume per long ton of w

weight unit than packages whic

feet per long ton

In order to aggregate t

assessed on different bases in

to convert them into a common 

dollars per container The 

intended partly to accomplish 

calculate the index numbers wh

Choice of Several 

When lump sum rates were g

selected for calculating the in

the unlikely event that the lum

lump sum equivalent of another 

rates were quoted with no lump 

may have been used in the 

significant differences exist 

produced the smallest revenue 

assumed that most cargo will 

represents the lowest cost to t

In some cases the rate b

period Indexes for the pre

unchanged unless a the new 

discontinuity or b the chang

newer tariffs appears to be m

previously selected base over a 

119
APPENDIX I 

PROCEDURES FOR COMPILING TARIF

CONVERSION 

Weightbased rates

1 The tariff is converted in

2 An average weight per cont

a first confirming that t

deadweight constraint of 

before the volume con

commodity sstowage facto

volume capacity to weight 

b searching the tariff for 

rules which determine 

container and

c using 85 of the maxi

containers if no other in

3 Multiplication of the rat

long ton capacity produces a 

referred to in the spreadsheet 

Measurementbased rates

1 The tariff is converted in

2 An average volume per 

whichever cubic capacity from 

one selected for the calculati

a dividing the average we

usually obtained from the 

long ton or

b using the minimum cubic 

tariff

3 Multiplication of the rate 

cubic capacity of the cont

container equivalent referred 

revenue per container

Rates expressed in foreign curr

1 If the tariffs are quo

currency then the calculations 

before being converted into US 

exchange rate for each quarter

2 In some cases the index 

with both currencies

120
APPENDIX I 

PROCEDURES FOR COMPILING TARIF

Calculation o

The tonnage of each commo

the quantity weights for the p

the index for all quarters 

converted into container equiv

rate per container to produce 

item The ratio of each wei

total weighted revenue was 

respective components of the t

for each commodity was also 

quarterly value for the revenu

in the base year

For the calculations a 

containers was used with 

information contained in the t

for both types of containers 

bulky cargo was shipped in the 

cargo was placed in the 20 fo

be justified on the basis of o

type of containers While t

least twice as much cubic capa

40 foot unit will have at m

It is understood that all 40 

direction must eventually r

utilization is not likely to 

was nevertheless believed that 

on the optimum will continue t

prevent the use of the corres

The indexes were calculated fro

the index weights for each 

mixture

In order to compare the p

for the individual commoditi

figures based upon a mixture 

into more comparable units 

calculated for all 20 foot co

are not fully comparable since 

Fair of 20 foot units for some 

40 foot unit for other comm

not expected to be great 

container figures were also ex

unit of weight and rate per un

rates are shown at the bottom 

12
APPENDIX I 

PROCEDURES FOR COMPILING TARIF

Addo

Currency adjustment fact

terminal charges were added 

appropriate and any discounts 

subtracted

Separate indexes are avail

1 The basic rate withou

2 The basic rate with c

3 The basic rate with a

All three indexes will not 

spreadsheet

The add on procedures diff

due to variations in custo

conference to another In fa

tariff practices in general 

difficult to define a standa

tariff rates It may be inte

spreadsheets for the full pe

whether those practices have be

122
This report was 

Commisss

Coordinated by 

and Ed

John Rob

12
12