FMC asks for more information from G6

   The Federal Maritime Commission wants more information on the proposed expansion of the G6 vessel-sharing agreement (VSA).
   Commissioners voted to ask for additional information from the G6 container carriers — APL, Hapag Lloyd, Hyundai Merchant Marine, MOL, NYK and OOCL — who want to expand their six-way cooperation into the Asia-U.S. West Coast trade and the transatlantic trade to and from North Europe and Mediterranean.
   The G6 members are already cooperating on the trade between Asia and the U.S. East Coast and on the trade between Asia and Europe. (The FMC does not review VSAs on the latter route.) The G6 members cooperate today in trios on the Asia-West Coast and transatlantic trades as the Grand Alliance (Hapag-Lloyd, NYK and OOCL) and New World Alliance (APL, Hyundai and MOL).
   The carriers will now address questions that the FMC has put to them. Once those replies are received, the commission will have 45 days to review those answers, after which the agreement will go into effect unless the FMC seeks an injunction.
   The FMC reviews agreements to determine if they are in compliance with the Shipping Act, and monitors the agreements once they become effective.
   It can seek an injunction to prevent an agreement from coming into effect only if it finds “the agreement is likely, by a reduction in competition, to produce an unreasonable reduction in transportation service or an unreasonable increase in transportation cost.”
   Last month, the FMC made a similar request for more information about another VSA, the so-called P3 Network, which would link up the three largest container carriers in the world — Maersk, MSC and CMA CGM. They are awaiting a reply from that group, at which point the 45-day review period for the P3 vessel-sharing agreement will begin.
   FMC Commissioner William P. Doyle said he was among those voting in favor of asking for additional information from G6 parties.
   “I have reviewed the proposed G6 Amendment and agree with the questions proposed by the commission,” said Commissioner Doyle.
   “I also submitted questions related to the impact this amendment would have on consumers, the U.S.-flag international fleet, small businesses and third-party interests such as terminals, vendors and bunker suppliers,” he added. “I trust that the G6 parties will thoroughly address all the questions posed in the commission’s request for additional information.”
   He noted that the proposed G6 Amendment for its new global network anticipates 180–220 vessels with a maximum capacity of 14,000 TEU.
   In comparison, the P3 Network proposes an initial deployment across all U.S. trades with an annual capacity of 130 vessels that range between 4,000 TEU and 12,250 TEU. The P3 VSA proposes to eventually expand to a maximum of 180 vessels with capacity up to 19,200 TEU.