STB denies NVO’s amended complaint against Matson and Horizon
The U.S. Surface Transportation Board voted 3-0 Monday to deny an amended complaint filed by freight forwarder DHX that challenges the reasonableness of the rates and practices of Matson Navigation Co. and Sea-Land Service, known today as Horizon Lines.
In its initial complaint to the STB, DHX alleged the carriers raised their overflow rates by 17.5 percent in a 12-month period since September 1998. The STB’s rules say carriers aren’t allowed to raise their rates more than 7.5 percent a year, known as the “zone of reasonableness.”
DHX alleged the carriers’ actions to rapidly raise “overflow” rates, adjust full-container rates and redefine the terms of shipment are an abuse of their Jones Act privileges.
To provide shippers with an incentive to tender full containerloads to its liner carriers, Matson created the overflow pricing strategy more than 20 years ago. Sea-Land adopted a similar pricing strategy when it entered the trade in the late 1980s.
The STB oversees the competitive practices of the railroads and the U.S.-flag carriers operating under the 1920 Merchant Marine Act, also known as the Jones Act.
“We are sorry that the board did not see merit in our complaints and denied our requests to correct the issues we presented to the board,” Brad Dechter, president of DHX, told Shippers’ NewsWire.
“Without seeing the board’s final written decision, which has not yet been published, we are not in a position to determine how we view the board’s decision,” Dechter added.
“While Matson has yet to see the written document, we are pleased with the decision,” said Jeff Hull, a Matson spokesman.
STB denies NVO’s amended complaint against Matson and Horizon
