U.S. FMC ADDRESSES CHINA’S RESTRICTIVE SHIPPING PRACTICES

   The U.S. Federal Maritime Commission ordered its chief attorney to prepare a formal order to address China’s alleged discrimination against U.S.-flag and other non-Chinese ocean carriers.
   The order will be prepared under the FMC’s Section 19 sanction authority
by the agency’s General Counsel Tom Panebianco. The FMC’s action came after a close meeting Thursday.
   The FMC’s actions are a result of an investigation that began in August
1998 in response to complaints from a number of sources, inclduing U.S.
flag carriers, non-vessel-operating common carriers, the Department of
State, the Department of Transportation, the Department of Commerce and
Sen. Ernest F. Hollings, D-S.C.
   Under Chinese law, U.S. carriers must go through a cumbersome
pre-clearance process in order to call at many Chinese ports, and they have
yet to win China’s approval to open more branch offices in China.
   Chinese law also restricts non-Chinese forwarders from issuing bills of
lading, arranging for customs clearance or from opening new branch offices
beyond the six originally approved by Chinese officials.
   The FMC will also keep a close watch over other developments, including
proposals that could require ocean carriers to disclose confidential
service contract rates and terms.
   Under Section 19 of the Merchant Marine Act of 1920, China could face a
number of sanctions, including limits on U.S. port calls, suspension of
tariffs, or vessel voyage fines of up to $1 million per U.S. port call.