Industry groups, NVOs urge FMC to lift limits on NSAs

Industry groups, NVOs urge FMC to lift limits on NSAs Industry groups, NVOs urge FMC to lift limits on NSAs
   A group of two industry groups, a shippers’ association, and five non-vessel-operating common carriers urged the U.S. Federal Maritime Commission in a letter this week to lift limitations imposed on groups of intermediaries from entering into service arrangements with their customers.
   The letter was signed by the original parties that petitioned the FMC for the right of NVOs to enter service arrangements (NSAs) with shippers. The letter’s signatories include the National Industrial Transportation League, Transportation Intermediaries Association, North Atlantic Alliance Association, UPS, FedEx Trade Networks Transport & Brokerage, BAX Global, BDP International, and C.H. Robinson Worldwide.
   The letter follows a recent U.S. Court of Appeals for the Fourth Circuit decision in the case of “United States vs. Gosselin,” which found that the two NVO defendants were not insulated from antitrust scrutiny under the 1984 Shipping Act and therefore were held liable for engaging in anticompetitive behavior.
   The group’s letter said the court’s decision “correctly confirms that agreements between NVOCCs were never intended to receive antitrust immunity under the Shipping Act” and “we are united in the belief that the commission is now in the position to take action to remove the limitations prohibiting multiple NVOCCs and shippers’ associations with NVOCC members from participating in NSAs.”
   An FMC decision to open NSAs to shippers’ associations with NVO members could help defuse another pending court case. The American Institute for Shippers’ Associations (AISA) and International Shippers’ Association (ISA) filed individual petitions with the U.S. Court of Appeals for the District of Columbia to review the FMC’s decision to restrict shippers’ associations from entering NSAs.
   The petitions, in particular, challenge the FMC’s section 16 authority under the Shipping Act. Section 16 allows the FMC to exempt any activity from the requirements of the Shipping Act if it finds the exemption will not result in a substantial reduction in competition or be detrimental to commerce.
   If the court should rule in favor of the two shippers’ associations, industry representatives fear the NSA rule could come to a halt. AISA and ISA have indicated that they would withdraw their court petitions if the FMC changed its NSA rule to allow shippers’ associations with NVO members to enter NSAs.