Although he has found no evidence that major container lines are collaborating illegally, Federal Maritime Commission Chair Daniel Maffei is certain that the US authority has much more to do, declaring himself prepared to engage in even more cases against the carriers, he says in an interview with WPO.
The US Federal Maritime Commission (FMC) plans to become even more aggressive in its efforts against mainline container carriers, says Chair Daniel Maffei in an interview with WPO.
The maritime authority has this past year been tightening its measures to address carriers as a consequence of bottlenecks on the container market and extremely high freight rates, which have led to criticism of container lines’ price and fee policies and brought shipping to the eyes of US lawmakers.
The whole world is a small world when it comes shipping. So we think we are doing some good but I’d like to see 30 cases. I think there is a lot of stuff [to go after] out there
Daniel Maffei, Chair, Federal Maritime Commission
FMC is currently engaged in cases against three major carriers and alliances, but Maffei would like to be doing even more than FMC currently is.
”Do I think it is enough? No. Do I sleep at night thinking: ’Boy, I’m doing just great’? No,” Maffei told WPO recently during transport conference TMC in Long Beach, California.
”The whole world is a small world when it comes shipping. So we think we are doing some good but I’d like to see 30 cases. I think there is a lot of stuff [to go after, -ed.] out there.”
FMC gets a tighter hold
Most recently, the US Senate on March 31 passed The Ocean Shipping Reform Act, which strengthens the FMC’s capacity to control and regulate shipping companies’ behavior – not least of all regarding US exporters, which are complaining that carriers are leaving them high and dry because it’s more lucrative for them to freight goods from Asian ports than US ones.
FMC is tasked with enforcing The Shipping Act, which regulates international shipping to and from the US, and the authority is also able to define rules for shipping companies.
In 2021, President Joe Biden’s administration asked the FMC to investigate whether container lines are attempting to push the already high freight rates further up through illegal collaboration or questionable business methods.
Carriers drop fees
On the whole, however, Maffei says that the FMC’s focus on shipping companies’ added fees have had a deterring effect, so many of them have refrained from implementing such fees or have exempted their customers, as already announced.
”We have seen a huge increase in detention and demeurrage charges that largely can be explained by the increased congestion, but we have also seen a huge increase in waivers, and I think that if our efforts were completely not working the waivers would not have gone up,” says the FMC chair, adding:
”Most of them never happened. A few of them were rolled out and then were taken back.”
We are not trying to catch everyone. We are trying to create a responsible deterrent
Daniel Maffei, Chair, Federal Maritime Commission
Shipping companies usually demand added charges from customers for containers that aren’t picked up or brought to terminals on time, but US legislation requires carriers to be fair and not exploit bottlenecks in the supply chains.
”We are too small an agency to enforce everything but what we want to do is to create the proper incentives for the carriers. And if the standard is there and they know it, then that is fine,” says Maffei.
Many baseless complaints
He underscores that a large part of the FMC’s efforts take place out of the public eye – typically as a reaction to a complaint over a shipping company.
The vast majority of investigations into carriers’ business practices never turn into legal cases – either because FMC employees conclude that a complaint is baseless or because the carriers themselves choose to change their practices in favor of the one filing the complaint.
”When we say that we have these 3 cases there is a lot of investigations going on behind the scenes,” says Maffei, assessing that the FMC’s ongoing investigations might lead to ”several dozen potential cases.”
”Not speaking about these specific cases, most of the time these cases would settle which is enough as long as we make our point. We are not trying to catch everyone. We are trying to create a responsible deterrent,” he says.
English edit: Jonas Sahl Hollænder
