TSA DENIES INTERMEDIARIES’ ALLEGATIONS OF DISCRIMINATORY PRACTICE

TSA DENIES INTERMEDIARIES’ ALLEGATIONS OF DISCRIMINATORY PRACTICE    The Transpacific Stabilization Agreement, a group of the major ocean carriers in the Asia/North America container trade, has rejected the allegations of discriminatory practices in the 2002 service contract negotiation period made by the National Customs Brokers and Forwarders Association and the International Association of NVOCCs, Inc. against it.
   In a response to the U.S. Federal Maritime Commission, the attorneys representing the carrier group asked the FMC to reject a petition asking for an investigation presented by the two associations of intermediaries, and said that their allegations are unsupported and untrue.
   “Petitioners have provided no facts or evidence of any kind to warrant an investigation, and have made it clear in their petition… that their members have no intention of providing any facts now or during the course of any investigation,” said Stanley O. Sher and David F. Smith, of the law firm Sher & Blackwell, on behalf of the TSA.
   “The requested investigation would tie up the resources of the Commission, and TSA, for months and perhaps years in a detailed examination of thousands of service contract provisions — all on the basis of a petition based solely on unsupported allegations,” TSA said in its response.
   TSA said that the only evidence the associations of intermediaries have advanced in their petition to the FMC is the general allegation of complaints from NVOCC members about the TSA’s service contracting practices during the current negotiating season.
   TSA stated said that there was no agreement by TSA members “not to negotiate with ocean transportation intermediaries until proprietary shipper negotiations were concluded,” nor was there any agreements among carrier members that OTIs would be charged “”substantially higher rates than proprietary shippers for the same services,” or that proposed rate increases for OTIs would be mandatory. whereas proposed increases for proprietary shippers would be waived.
   ” TSA’s rate guidelines were and have been at all times voluntary and non-binding, and each TSA member is free to act independently and to disregard any such guideline at any time,” the TSA said.
   The attorneys said that the TSA is confident that its members’ existing contract rates “reflect an intensely competitive and diverse market with a plethora of individual customized rates and services,” and that most current rates, including those of petitioners’ OTI members, are lower than they were at this time last year.
   The National Customs Brokers and Forwarders Association and International Association of NVOCCs had alleged that TSA carriers refused to negotiate with OTIs until after having concluded contracts with proprietary shippers. The TSA replied that, to the extent that OTI contracts are negotiated later in the contract cycle, “it is a function of the market, not a TSA agreement.”
   The group of transpacific carriers also noted that the rates of most shippers in their 2002 transpacific eastbound service contracts are “lower, and in many cases substantially lower,” than the rates in their 2001 contracts.    “In particular, TSA understands that many contract rates, including those of many OTIs, declined significantly — in some cases up to 30 percent,” the carrier group said.