NEWS FLASH: FMC approves OCEAN Alliance

The Federal Maritime Commission said Friday it concluded its review of the proposed OCEAN Alliance, allowing the new ocean carrier alliance to take effect Monday, although it is not expected to commence operations until around April 2017.    The Federal Maritime Commission (FMC) said it has concluded its review of the proposed OCEAN Alliance, FMC Agreement No. 012426, allowing it to take effect Monday, although it is not expected to become operational until around April of next year.
   The OCEAN Alliance members include COSCO Shipping, CMA CGM, Evergreen Marine and Orient Overseas Container Line Limited (OOCL).
   The FMC said the members of the alliance are now permitted to share vessels; charter and exchange space on one other’s ships; and enter into cooperative working arrangements in international trade lanes between the United States and ports in Asia, Northern Europe, the Mediterranean, the Middle East, Canada, Central America and the Caribbean. The FMC does not regulate services that do not call the United States, but the Ocean Alliance is planning to serve the Asia-North Europe, Asia-Mediterranean, Asia-Middle East and Asia-Red Sea trades.
   The FMC said it did an “exhaustive review” of the Ocean Alliance and “took advantage of the opportunity allowed for under the law to issue a request for additional information, which necessitates the filing of further documentation in support of the application.”
   “The Commission worked very hard to balance the needs of not only the OCEAN Alliance applicants, but all other parties involved in the intermodal supply chain, with the ultimate goal of safeguarding competition in international oceanborne common carriage, with the American shipping public foremost in mind,” FMC Chairman Mario Cordero said.
   FMC Commissioner William P. Doyle said he supported the alliance. “The agreement has significantly changed since its initial filing,” he said. “The parties are limited in their ability to use their collective market power to jointly negotiate contracts with marine terminal operators.
   “Importantly, the Ocean Alliance partners must negotiate independently with and enter into separate individual contracts with stevedores, tugs, barges, chassis providers and other third-party service providers. This is the same type of language that exists in the 2M Alliance Agreement,” Doyle added.