Ocean cargo: The Shipping Act of 2010 signals end to cartels

The bill also will empower the FMC to mediate contract disputes…something shippers have long waited for

By ·

As widely expected, the Federal Maritime Commission is likely to be given more authority next year to end ocean carrier pricing collusion.

The Shipping Act of 2010, introduced by Rep. James L. Oberstar, D-Minn., yesterday will abolish carrier antitrust immunity and prevent carrier executives from convening so-called “discussion groups” used to formalize rate strategy.

The bill also will empower the FMC to mediate contract disputes…something shippers have long waited for.

“The carrier’s freewheeling market share approach to contracts is what took rates down in the first place,” said Jon Monroe, president of Monroe Consulting in Shanghai. “But the real frustration was the lack of communication and the lack of a real partnership.”

As reported in LM, a draft of this bill had been endorsed by a large coalition of shippers this summer. U.S. exporters of agricultural goods had been especially vocal in their support of legislation that might also encourage carriers to provide more containers for westbound deployment.

Oberstar, chairman of the House Transportation and Infrastructure Committee, apparently had been listening.

“Even under the current regulatory scheme, immunity for agreements has long outlived its usefulness,” he said in a statement.

Michael Berzon, chairman of the National Industrial Transportation League’s ocean committee, told LM last month that U.S.shippers were making a compelling argument.

“If enacted, the end of the limited anti-trust immunity would follow the action taken by European regulators,” he said.  “Since the elimination of the EU Block Exemption, it prohibits consultation by groups of carriers to discuss rates in the European trades.”


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

Container · Exports · Shipping · Trade · Transportation · All Topics
Latest Whitepaper
Private Fleet vs. Dedicated: Which one is right for you?
Having the right fleet for your business can give you an advantage over the competition and lower transportation costs.
Download Today!
From the April 2017 Issue
While adoption rates have remained relatively flat, yard management systems (YMS) are helping logistics operations turn that important space between the loading dock and the gate into a vital link in the supply chain.
Information Management: Wearables come in for a refit
2017 Air Cargo Roundtable: Positive Outlook Driven by New Demand
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Maximize Your LTL Driver Adherence with Real-time Feedback
This webinar shows how companies are using real-time performance data to optimize the scheduling of their city fleets, as well as the routing of their standard, accelerated and time-critical shipments.
Register Today!
EDITORS' PICKS
2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...
LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...

ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...
2017 Rate Outlook: Will the pieces fall into place?
Trade and transport analysts see a turnaround in last year’s negative market outlook, but as...