FMC remains ‘open’ to reviewing NVO rule
A majority of members of the U.S. Federal Maritime Commission are “open to reviewing” its new rules allowing non-vessel-operating common carriers and shippers to enter confidential service arrangements, or NSAs, Commissioner Paul Anderson told an industry conference in Anaheim, Calif.
Anderson said the FMC was assessing objections to the NSA rules filed with the FMC by the American Institute for Shippers Associations and the International Shippers Association were being assessed.
“It was always part of our thinking that the requirements as to who might file NSAs would be reviewed at intervals by the commission,” Anderson said.
FMC’s regulations prohibit shipper/NVO-based associations or individual NVOs from entering into service arrangements with other NVOs.
The commission’s NSA rule has been “one of the most important issues since the Ocean Shipping Reform Act,” Anderson said. He noted that more than 200 members of Congress had contacted the FMC while the commission was formulating the new regulations.
“That was a huge lobbying effort,” he said. “It became very clear that if the commission did not act, Congress would intervene” on behalf of NVOs.'
Regulatory commissions were created “to keep these issues out of Congress, which has its hands full,” Anderson explained.
“This is a very strategic time for the United States in terms of trade. Globalization is taking place on our doorstep,” Anderson said.
The expected surge this year in imports from Asia could create “serious difficulties for our ports and logistics infrastructure,” he noted.
“I remain optimistic that problems, particularly those associated with loading 7,500-TEU-plus vessels, are not insurmountable. I recently was given a helicopter tour of the ports of Los Angeles and Long Beach, as well as the Alameda Corridor, and it was very heartening to see from the air all of the new expansion,” Anderson said.
“However,” he added pointedly, “we will never see relief from port congestion unless we solve labor issues.”
In terms of facility infrastructure, “a lot of the easy solutions have been found and implemented. We’re running out of such options. The hard choices are now before us,” he said.
“Building more terminals on the West Coast, as some have recommended in sites as varied as Baja and Vancouver, is not the answer, in my view. There’s the hindrance of not having adequate rail service, and we would wind up spending a lot of money and still have the same problems,” Anderson said.
As for port and terminal protection, “we have not reached the pinnacle of security implementation,” he explained.
If there is another terrorist attack, Anderson said it would be plausible to expect a total shutdown of U.S. ports, which would “have a catastrophic impact across the nation,” he warned.
However, there are indications that the Department of Homeland Security “is beginning to think strategically,” Anderson said. There could be “something less than a total shutdown,” depending on circumstances.
Speaking generally, Anderson noted “in my view and that of my fellow commissioners, it is a very good thing for shippers and carriers to now be sharing strategic information. We don’t have to regulate that.” “There’s been a paradigm shift from previous attitudes that prevented long-term strategic relationships. In fact, you don’t see such breakthroughs very often, and it’s important to take advantage of the opportunities they bring when they occur.”
Anderson spoke at a conference on ocean contracting sponsored by the National Industrial Transportation League, the Cameron Group, and American Shipper.