FMC authorizes ocean carriers to serve on NYSHEX board

The Federal Maritime Commission has authorized ocean carriers CMA CGM, Hapag-Lloyd, MOL Line and COSCO Shipping to serve in board positions of the forward freight contract provider.    A recent Federal Maritime Commission (FMC) agreement has authorized ocean carriers CMA CGM, Hapag-Lloyd, Mitsui O.S.K. (MOL) Lines and COSCO Shipping to potentially serve on the board of digital shipping rate contracting technology company the New York Shipping Exchange (NYSHEX).
   The NYSHEX board has nine positions, the company told American Shipper, of which two will be occupied by ocean carriers and two by shippers at all times. The board makeup is designed to follow best practice for exchanges, where there is equal representation from interested parties. It’s not yet been decided how long members will serve on the board.
   Carrier board members will participate in board meetings and discussions relevant to management at NYSHEX.
   More specifically, the carriers “are authorized to carry out the management, development, modification, marketing, and operation of NYSHEX, and are authorized to discuss and agree on all aspects of the structure, authority, corporate governance, management, development, marketing and operation of NYSHEX, and related matters, including, but not limited to, the capitalization, ownership, initial and subsequent stock subscriptions, management, administration, staffing, and facilities of NYSHEX,” the FMC agreement stated.
   However, the agreement notes, “Nothing in this Agreement authorizes any of the Parties to discuss, exchange or agree upon the ocean freight rates, surcharges, or accessorials that will be applicable to ocean transportation provided by a Party via NYSHEX.”
   The soonest the agreement would come into effect is Dec. 2, after a 45-day comment period, the FMC noted.
   One of the carriers listed in this agreement already partners with NYSHEX to offer U.S. exporters guaranteed rates through four U.S. ports to Asia. This guaranteed service is offered during the transpacific peak season from August to October.
   NYSHEX strives to overcome the age-old cycle of overbooking and cargo cancellation still plaguing the ocean shipping world, and has recently touted a 99.6 percent fulfillment rate for its ocean contracts compared to just 46 percent for traditional, non-guaranteed contracts.