In Husch Blackwell’s May 2020 Trade Law Newsletter, you’ll learn about the following updates in international trade and supply chain law:
- Bureau of Industry and Security (BIS) announces opportunities
On April 28, 2020, the Federal Maritime Commission (“Commission “or “FMC”) released the long-awaited interpretive rules in Docket No. 19-05 relating to how ocean common carriers may lawfully apply demurrage…
Continue Reading New FMC Interpretative Demurrage and Detention Rules: Will They Assist Ocean Transportation Intermediaries?
What might not be so obvious in this COVID-19 environment, which we have grown to associate with shortages, is that counterintuitively there are issues beginning to appear dealing with the opposite situation. The Journal of Commerce has reported that “[t]he container shipping industry is marshaling a response to signs of a building import backlog as some retailers and manufacturers fail to pick up containers because warehouses are full or closed due to not being deemed essential service providers responding to coronavirus disease 2019 (COVID-19).” This is a development with implications to all stakeholders in the supply chain and will have some impact on retailers/manufacturers, ocean carriers, ocean transportation intermediaries, and warehouses.
Most agencies of the United States government, including the Federal Maritime Commission (”the Commission”), have been closed since December 22, 2018. Since that date shippers, ocean common carriers, and non-vessel operating common carriers in their shipper role have not had access to SERVCON, the service contract electronic filing system of the Commission. So how is it intended for these supply chain players to adhere to Commission regulations related to initial or service contracts about to be renewed, or amendments to existing service contracts during this dysfunctional period which at this point hasn’t shown even a hint of an end game? Short answer: the same as always, but without the filing obligation nor risk of sanctions (penalties). The filing requirement is temporarily lifted. Therefore, service contract activity can continue as usual without concern of penalties. There are some caveats though. …
Continue Reading U.S. Government Shutdown: The Impact on Federal Maritime Commission Service Contracts
The following is a short, to the point, summary of recent developments which impact transportation intermediaries, some of which can be implemented simply without fanfare, others which just bear careful monitoring. The Federal Maritime Commission (“FMC”) recently passed new regulations relating to Negotiated Rate Arrangements (“NRAs”), and NVOCC Service Arrangements (“NSAs”) which require some simple implementation, but then little else. The Federal Motor Carrier Safety Administration (“FMCSA”) has amended Hours of Service regulations which provide for strict usage of Electronic Logging Devices (“ELDs”), and a corresponding obligation for those intermediaries who select motor carriers for transport. Last but not least, we will briefly explore the question of where is the transport intermediary industry headed in the evolving e-commerce revolution?
Continue Reading Update on Current Issues Impacting Transportation Intermediaries
WHEN? The Federal Maritime Commission by Final Rule issued July 19, 2018 took final rules to simplify freight pricing requirements for Non-vessel Operating Common Carriers (“NVOCCs”) by establishing changes to Negotiated Rate Arrangements (NRAs) and NVOCC Service Arrangements (NSAs). These new Rules become effective August 22, 2018.…
Continue Reading New FMC Regulations Effective August 22, 2018
WHEN? On June 6, 2018, the Federal Maritime Commission took steps to simplify freight pricing requirements for Non-vessel Operating Common Carriers (“NVOCCs”) by “approving” changes to Negotiated Rate Arrangements (NRAs) and NVOCC Service Arrangements (NSAs). While many NVOCCs are still utilizing the fast disappearing tariff publication methods of meeting the regulatory shipping requirements, it is our opinion that the contemplated changes to NRAs and NSAs will win over the NVOCC community to their almost exclusive usage. While the “Final Rules” were approved, it was clear from the FMC meeting, that the written provisions were still at a drafting stage. In discussions with senior FMC staff, it is our understanding that the so-called “Final Rules” will be going to the Federal Register later this week. By law they are required to be posted on the Federal Register for 30 days before becoming effective. Therefore, a good bet would be that these rules will be effective sometime in the first week of August, 2018.…
Continue Reading New NVOCC Pricing Models on The Horizon
The government shutdown began on Saturday at 12:01am. Here is a list of several agencies involved in trade and transportation issues that will be affected.
International Trade Commission
The International Trade Commission will only have three to seven individuals working during the shutdown in order to protect life and property. The six Commissioners are presidential appointees and therefore are exempt from the furlough. …
Continue Reading Impact of Government Shutdown on Trade
On November 8, the Federal Maritime Commission (FMC) issued a Notice for Proposed Rulemaking regarding modifications to NVOCC Service Arrangements (NSAs) and Negotiated Rate Arrangements (NRAs).
NSAs will continue to serve as basic agreements between NVOCCS and their customers for comprehensive longer-termed ocean transport agreements with provisions similar to those included in ocean carrier service contracts, with two basic differences:…
Continue Reading Federal Maritime Commission NVOCC Deregulation More Imminent
July 5 is the deadline to submit comments in response to the Federal Maritime Commission’s Notice of Inquiry seeking guidance on maritime regulations that should be modified or eliminated. As noted in our previous post, within the NOI the FMC specifically identifies the regulations which impose tariff publication requirements (46 C.F.R. §520) as a target for deregulation.
Coupled with recent comments by Acting FMC Chairman Michael Khouri acknowledging the lack of purpose in tariff publication, it appears that tariff publication requirements may be coming to an end:
Current bills (HR 2593, S. 1119) authorizing appropriations for the Federal Maritime Commission contain substantive terms which seem to forecast the path the regulatory agency is taking with respect to both tariff requirements and regulation of ocean transportation intermediaries.
The bills address some meaningful changes to the current antiquated tariff system. Combined with the FMC’s new Regulatory Reform Task Force, and the corresponding Notice of Inquiry issued by the FMC seeking specifics from the shipping public for deregulation, it appears the FMC may be taking a clear stance on tariffs. Acting Chairman of the Federal Maritime Commission, Michael Khouri, has made several public statements which confirm the conclusion that tariffs have no place in the current ocean transportation marketplace.