FMC Revamps Carrier Tariffs: Changes Effective Feb. 1

The Federal Maritime Commission (FMC) has recently issued a Final Rule in FMC Docket No. 21-03, amending its regulations on Carrier Automated Tariffs. These amendments, effective from February 1, 2024, as detailed in 89 FR 25, aim to adjust the pricing practices of vessel-operating common carriers (VOCCs) and non-vessel operating common carriers (NVOCCs) and introduce broad changes to the carrier automated tariff system.

Key Updates in Carrier Automated Tariffs:Public Access Fee Elimination: In a significant move towards transparency, VOCCs and NVOCCs will no longer be able to charge fees for the public to access their tariffs.

Tariff Maintenance Requirements for NVOCCs: NVOCCs that fail to maintain a tariff will face consequences, such as the revocation of their license or suspension of their registration in the case of foreign-based unlicensed NVOCCs.

Changes Concerning NVOCC Pass-Through Charges:Authority for VOCC GRI Pass-Through: NVOCCs can now pass through underlying VOCC General Rate Increases (GRIs) to their shippers, provided they have addressed this in their governing rules tariff.General

References in Tariffs for Pass-Through Charges: If NVOCCs will pass through surcharges, accessorial charges, or GRIs at cost from the underlying VOCC, they must note this in their FMC rules tariff.

Separation of NVOCC Rates from Pass-Through Charges: NVOCCs must keep their own rates and fees separate from any charges intended to be passed through to shippers, ensuring clear identification of rates for the services provided.

Advance Payment Charge:  NVOCCs may now access a separate charge published in their tariffs concerning their processing/handling pass-through charges.

Adjustments in Co-Loading Arrangements:Co-Loading Arrangement Disclosure Not Required: NVOCCs are not required to note in their tariffs whether their cargo tender involves a co-loading arrangement with another NVOCC.

Carrier-Carrier Co-Loading for LCL Shipments: For carrier-carrier co-loading arrangements, cargoes are limited to LCL shipments. Each NVOCC involved will issue its own house bill of lading for its part of the cargo and act as the common carrier for its respective shipper.

These regulatory changes by the FMC are set to enhance the efficiency and transparency in the maritime shipping sector, reflecting the evolving needs of the industry.

Please Click Here to schedule a follow-up meeting to discuss how these changes will impact your NVOCC operations. 

FMC Monitoring Rate Increases Due to Threats to Shipping

The series of threats from and attacks by the Houthis, a Yemen-based rebel group, has resulted in ocean carriers announcing rate increases and/or instituting fees or surcharges to recoup expenses associated with longer voyages and/or higher costs of insurance and security.

The Houthis has publicly threatened to attack shipping in the Red Sea and Gulf of Aden regions which in their view has some affiliation with Israel, and lately even ships coming from or going to Israeli ports. This maritime threat is reportedly greater in the vicinity of the Yemeni Red Sea coastline, where the Houthis forces are occasionally present.

The Federal Maritime Commission says it is aware that ocean common carriers are adjusting vessel operations and deployments in response to these threats but cautions that the increased charges must meet strict legal requirements.

"Competition among carriers must not be suspended and carriers and parties to vessel sharing agreements must continue to obey the Shipping Act, other U.S. competition laws, and all other applicable laws," the FMC said.

The Federal Maritime Commission is monitoring actions taken by ocean common carriers related to rates, fees, and surcharges to ensure their compliance with all statutory and regulatory requirements.

AP Tariffs has been a great help in assisting foreign non-vessel operating common carriers (NVOCCs) become registered in the United States. Recognition from the FMC provides foreign NVOCCs with an edge in the competitive maritime business and AP Tariffs makes the process fast and easy!

Let's make your business grow! Send us an email at info@aptariffs.com or schedule a free 15-minute consultation through this link.

Complaint Filed Against NVOCC for Misdeclaration

USL Auto Exporting Inc., a vehicle exporter, filed a complaint against Easy Shipping Corporation, a licensed NVOCC and OFF based in Illinois, early December 2023.

According to USL Auto, in April 2023, they entered into a contract with Easy Shipping to ship 4 vehicles from Savannah, Georgia to Libya. Easy Shipping sent them a booking confirmation. The container was successfully loaded into the vessel in late April.

However on May 11, 2023, CMA-CGM reached out to Easy Shipping and noted a misdeclaration in the shipping instructions for the cargo. Easy Shipping reportedly replied to CMA-CGM saying that the warehouse made the mistake. But upon careful review of the dock receipt, USL Auto said it was Easy Shipping that made the mistake.

In light of the misdeclaration, CMA-CGM redirected the container back to Savannah and imposed a $2,000 penalty for the oversight.

According to USL Auto, Easy Shipping's neglect and inaccurate declaration of the shipping instructions caused them to incur a total of $8,910 in charges. In addition, USL Auto says that Easy Shipping also caused the returned container to incur demurrage fees of $26,130. Furthermore, by not paying the demurrage fees, Easy Shipping caused USL Auto to lose the cargo, which total $31,800. USL Auto also claims that Easy Shipping's actions deprived them of customary profits amounting to a loss of $12,000.

USL Auto is asking the Federal Maritime Commission to, among others, award them damages in an amount in excess of $52,710 plus interest. Read the complaint here.

In their response, Easy Shipping said they are unaware of the company USL Auto Exporting Inc. Easy Shipping said they only communicated with an individual, Khalid Arwini, for his personal shipment.

Easy Shipping alleged that Mr. Arwini requested only booking with CMA-CGM and documentation of the dock receipt from them.

According to Easy Shipping, CMA-CGM contacted them that the container contained prohibited import to Libya and that's why the container was pulled and returned back to Savannah.

Easy Shipping says Mr. Arwini had agreed to be held financially responsible for the container. They said Mr. Arwini was aware and agreed to all charges and fees that were needed for the container to be unloaded and released.

Easy Shipping is asking the FMC to, among others, order Mr. Arwini to pay for the required demurrage and detention, and storage outstanding balance that was agreed to cover all cost of the shipped container. Read the Response here.

The Honorable Alex M. Chintella will preside at the hearings and presentation of evidence as may be necessary to resolve this complaint.

AP Tariffs Inc. has experts available to provide legal consultation in English and Spanish. AP Tariffs is more than just a tariff publisher, it is an excellent partner for both non-vessel operating common carriers (NVOCCs) and vessel operating common carriers (VOCCs) in navigating FMC rules and maintaining compliance with FMC regulations.

Got a question for us? Schedule a 15-minute consultation here.