CMA CGM begins consolidating different brands

The French ocean carrier, which earlier this year acquired a majority of NOL, the parent company of ocean carrier APL, will consolidate the existing transpacific businesses of its ANL and US Lines brands between North America and Asia under the APL brand.    Ocean carrier CMA CGM will consolidate the existing transpacific businesses of its ANL and US Lines brands between North America and Asia under the APL brand.
   Marseille, France-based CMA CGM, the third largest container carrier, acquired a majority of Neptune Orient Lines, the Singapore-based parent company of APL, earlier this year. On or around Sept. 1, NOL will be delisted from the Singapore stock exchange and be 100 percent owned by CMA CGM.
   “At that time, CMA CGM will begin to consolidate certain operations under its various brands worldwide,” the companies said in a petition with the Federal Maritime Commission (FMC).
   CMA CGM explained that in the U.S., it “currently operates under its own tariff and bill of lading and also under the tariff and bill of lading of its wholly owned subsidiary ANL Singapore Pte. Ltd. ANL is a Singaporean company doing business in the U.S. through its wholly owned agent U.S. Lines, LLC. ANL’s operations focus on the transpacific and Oceania trades.”
   APL told the FMC, “In order to consolidate brands in the United States, CMA CGM has made the decision to transfer the current ANL transpacific slot allocations to APL. Effective Oct. 1, 2016, all of the space that ANL currently has on CMA CGM services in the transpacific will be transferred to APL. ANL will remain a VOCC (vessel owning common carrier) in the U.S. and will continue for now to provide services on the Oceania trades.”
   In a statement sent to customers on Tuesday, APL said, “This change is in line with the CMA CGM Group’s strategy to retain and significantly grow the APL brand, leveraging on its existing strengths and capabilities in the transpacific trade.”
   The APL statement continued, “In order to accomplish this consolidation, all ANL/USL U.S. service contracts that exclusively have transpacific lanes will be assigned to APL.”  APL said it will honor all contractual obligations and will continue to provide the same services and quality.
   “To the extent that your service contract permits assignment by notice, please consider this to be that notice,” APL said. “If your service contract requires that you consent to this assignment, we ask that you kindly advise us by reply e-mail within 7 days of receipt of this message, if you require a formal consent to be prepared. Your present ANL/USL contact will also be available to assist you during this process. If we have not heard from you by then or if you continue to tender cargo under the contract on or after Oct. 1, 2016, we will assume you agree to the assignment and do not require a formal consent.”
   APL filed the petition with the FMC “seeking an exemption for the amendment filing requirements that would otherwise apply to this assignment.”
   In addition, the carrier told the FMC, “The transfer of ANL transpacific business will include an assignment of all of ANL’s service contracts in accordance with their terms and applicable law. There are approximately 600 service contracts that exclusively cover transpacific services to be assigned. ANL has approximately 175 contracts that exclusively cover the Oceania trades that will remain with ANL and another 175 contracts that are mixed Transpacific/Oceania that will need to be amended individually in order to split the trade lanes between APL and ANL. This petition relates only to the 600 contracts to be completely assigned to APL.”
   APL also said, “Assignment of ANL’s contracts to APL, even when performed in accordance with the terms of the contracts and applicable contract law, would require the filing with the FMC of an amendment to each contract.” APL told the FMC it would be “an undue burden on APL and the shipper parties to prepare and file an individual amendment for each of these service contracts.” Consequently, APL asked the FMC for permission to send a universal notice to the commission and to each of the service contract parties.