FMC Proposes Permitting Foreign-Based NVOCCs to Use Negotiated Rate Agreements


On February 22, the Federal Maritime Commission (FMC) issued a proposed rule that would permit foreign-based unlicensed non-vessel-operating common carriers (NVOCCs) to offer and enter into Negotiated Rate Arrangements (NRAs) covering ocean transport services in the U.S. foreign commerce. This is a break from the FMC’s past position on whether unlicensed NVOCC’s could utilize NRAs for non-tariff-based transactions. Interested parties can submit comments to the FMC on or before April 29, 2013.

Specifically, the rule, issued pursuant to Docket 11-22, would: (1) extend certain exemptions from the Shipping Act of 1984 (“the Shipping Act”) and FMC regulations to foreign-based NVOCCs allowing them to enter into NRAs; and (2) impose more detailed registration requirements on such foreign-based unlicensed NVOCCs.

Under the current regime, the FMC exempts only licensed NVOCCs that enter into NRAs from the Shipping Act’s tariff rate publication requirements and related FMC regulations. 46 C.F.R. Part 532. The FMC originally elected not to extend the same exemptions to foreign-based unlicensed NVOCCs, citing concern for oversight and record keeping.

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Topics:  Federal Maritime Commission, Negotiated Rate Agreements, NVOCCs, U.S. Foreign Commerce

Published In: General Business Updates, International Trade Updates, Maritime Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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