[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 414 Enrolled Bill (ENR)]

        S.414

                       One Hundred Fifth Congress

                                 of the

                        United States of America


                          AT THE SECOND SESSION

          Begun and held at the City of Washington on Tuesday,
the twenty-seventh day of January, one thousand nine hundred and ninety-
                                  eight


                                 An Act


 
     To amend the Shipping Act of 1984 to encourage competition in 
  international shipping and growth of United States exports, and for 
                             other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Ocean Shipping Reform Act of 1998''.

SEC. 2. EFFECTIVE DATE.

    Except as otherwise expressly provided in this Act, this Act and 
the amendments made by this Act take effect May 1, 1999.

            TITLE I--AMENDMENTS TO THE SHIPPING ACT OF 1984

SEC. 101. PURPOSE.

    Section 2 of the Shipping Act of 1984 (46 U.S.C. App. 1701) is 
amended by--
        (1) striking ``and'' after the semicolon in paragraph (2);
        (2) striking ``needs.'' in paragraph (3) and inserting ``needs; 
    and'';
        (3) adding at the end thereof the following:
        ``(4) to promote the growth and development of United States 
    exports through competitive and efficient ocean transportation and 
    by placing a greater reliance on the marketplace.''.

SEC. 102. DEFINITIONS.

    Section 3 of the Shipping Act of 1984 (46 U.S.C. App. 1702) is 
amended by--
        (1) striking ``the government under whose registry the vessels 
    of the carrier operate;'' in paragraph (8) and inserting ``a 
    government;'';
        (2) striking paragraph (9) and inserting the following:
        ``(9) `deferred rebate' means a return by a common carrier of 
    any portion of freight money to a shipper as a consideration for 
    that shipper giving all, or any portion, of its shipments to that 
    or any other common carrier over a fixed period of time, the 
    payment of which is deferred beyond the completion of service for 
    which it is paid, and is made only if the shipper has agreed to 
    make a further shipment or shipments with that or any other common 
    carrier.'';
        (3) striking paragraph (10) and redesignating paragraphs (11) 
    through (27) as paragraphs (10) through (26);
        (4) striking ``in an unfinished or semifinished state that 
    require special handling moving in lot sizes too large for a 
    container,'' in paragraph (10), as redesignated;
        (5) striking ``paper board in rolls, and paper in rolls.'' in 
    paragraph (10) as redesignated and inserting ``paper and paper 
    board in rolls or in pallet or skid-sized sheets.'';
        (6) striking ``conference, other than a service contract or 
    contract based upon time-volume rates,'' in paragraph (13) as 
    redesignated and inserting ``agreement'';
        (7) striking ``conference.'' in paragraph (13) as redesignated 
    and inserting ``agreement and the contract provides for a deferred 
    rebate arrangement.'';
        (8) striking ``carrier.'' in paragraph (14) as redesignated and 
    inserting ``carrier, or in connection with a common carrier and a 
    water carrier subject to subchapter II of chapter 135 of title 49, 
    United States Code.'';
        (9) striking paragraph (16) as redesignated and redesignating 
    paragraphs (17) through (26) as redesignated as paragraphs (16) 
    through (25), respectively;
        (10) striking paragraph (17), as redesignated, and inserting 
    the following:
        ``(17) `ocean transportation intermediary' means an ocean 
    freight forwarder or a non-vessel-operating common carrier. For 
    purposes of this paragraph, the term--
            ``(A) `ocean freight forwarder' means a person that--
                ``(i) in the United States, dispatches shipments from 
            the United States via a common carrier and books or 
            otherwise arranges space for those shipments on behalf of 
            shippers; and
                ``(ii) processes the documentation or performs related 
            activities incident to those shipments; and
            ``(B) `non-vessel-operating common carrier' means a common 
        carrier that does not operate the vessels by which the ocean 
        transportation is provided, and is a shipper in its 
        relationship with an ocean common carrier.'';
        (11) striking paragraph (19), as redesignated and inserting the 
    following:
        ``(19) `service contract' means a written contract, other than 
    a bill of lading or a receipt, between one or more shippers and an 
    individual ocean common carrier or an agreement between or among 
    ocean common carriers in which the shipper or shippers makes a 
    commitment to provide a certain volume or portion of cargo over a 
    fixed time period, and the ocean common carrier or the agreement 
    commits to a certain rate or rate schedule and a defined service 
    level, such as assured space, transit time, port rotation, or 
    similar service features. The contract may also specify provisions 
    in the event of nonperformance on the part of any party.''; and
        (12) striking paragraph (21), as redesignated, and inserting 
    the following:
        ``(21) `shipper' means--
            ``(A) a cargo owner;
            ``(B) the person for whose account the ocean transportation 
        is provided;
            ``(C) the person to whom delivery is to be made;
            ``(D) a shippers' association; or
            ``(E) an ocean transportation intermediary, as defined in 
        paragraph (17)(B) of this section, that accepts responsibility 
        for payment of all charges applicable under the tariff or 
        service contract.''.

SEC. 103. AGREEMENTS WITHIN THE SCOPE OF THE ACT.

    (a) Ocean Common Carriers.--Section 4(a) of the Shipping Act of 
1984 (46 U.S.C. App. 1703(a)) is amended by--
        (1) striking ``operators or non-vessel-operating common 
    carriers;'' in paragraph (5) and inserting ``operators;'';
        (2) striking ``and'' in paragraph (6) and inserting ``or''; and
        (3) striking paragraph (7) and inserting the following:
        ``(7) discuss and agree on any matter related to service 
    contracts.''.
    (b) Marine Terminal Operators.--Section 4(b) of that Act (46 U.S.C. 
App. 1703(b)) is amended by--
        (1) striking ``(to the extent the agreements involve ocean 
    transportation in the foreign commerce of the United States)'';
        (2) striking ``and'' in paragraph (1) and inserting ``or''; and
        (3) striking ``arrangements.'' in paragraph (2) and inserting 
    ``arrangements, to the extent that such agreements involve ocean 
    transportation in the foreign commerce of the United States.''.

SEC. 104. AGREEMENTS.

    (a) In General.--Section 5 of the Shipping Act of 1984 (46 U.S.C. 
App. 1704) is amended by--
        (1) striking subsection (b)(8) and inserting the following:
        ``(8) provide that any member of the conference may take 
    independent action on any rate or service item upon not more than 5 
    calendar days' notice to the conference and that, except for exempt 
    commodities not published in the conference tariff, the conference 
    will include the new rate or service item in its tariff for use by 
    that member, effective no later than 5 calendar days after receipt 
    of the notice, and by any other member that notifies the conference 
    that it elects to adopt the independent rate or service item on or 
    after its effective date, in lieu of the existing conference tariff 
    provision for that rate or service item;
        (2) redesignating subsections (c) through (e) as subsections 
    (d) through (f); and
        (3) inserting after subsection (b) the following:
    ``(c) Ocean Common Carrier Agreements.--An ocean common carrier 
agreement may not--
        ``(1) prohibit or restrict a member or members of the agreement 
    from engaging in negotiations for service contracts with 1 or more 
    shippers;
        ``(2) require a member or members of the agreement to disclose 
    a negotiation on a service contract, or the terms and conditions of 
    a service contract, other than those terms or conditions required 
    to be published under section 8(c)(3) of this Act; or
        ``(3) adopt mandatory rules or requirements affecting the right 
    of an agreement member or agreement members to negotiate and enter 
    into service contracts.
An agreement may provide authority to adopt voluntary guidelines 
relating to the terms and procedures of an agreement member's or 
agreement members' service contracts if the guidelines explicitly state 
the right of members of the agreement not to follow the guidelines. 
These guidelines shall be confidentially submitted to the 
Commission.''.
    (b) Application.--
        (1) Subsection (e) of section 5 of that Act, as redesignated, 
    is amended by striking ``this Act, the Shipping Act, 1916, and the 
    Intercoastal Shipping Act, 1933, do'' and inserting ``this Act 
    does''; and
        (2) Subsection (f) of section 5 of that Act, as redesignated, 
    is amended by--
            (A) striking ``and the Shipping Act, 1916, do'' and 
        inserting ``does'';
            (B) striking ``or the Shipping Act, 1916,''; and
            (C) inserting ``or are essential terms of a service 
        contract'' after ``tariff''.

SEC. 105. EXEMPTION FROM ANTITRUST LAWS.

    Section 7 of the Shipping Act of 1984 (46 U.S.C. App. 1706) is 
amended by--
        (1) inserting ``or publication'' in paragraph (2) of subsection 
    (a) after ``filing'';
        (2) striking ``or'' at the end of subsection (b)(2);
        (3) striking ``States.'' at the end of subsection (b)(3) and 
    inserting ``States; or''; and
        (4) adding at the end of subsection (b) the following:
        ``(4) to any loyalty contract.''.

SEC. 106. TARIFFS.

    (a) In General.--Section 8(a) of the Shipping Act of 1984 (46 
U.S.C. App. 1707(a)) is amended by--
        (1) inserting ``new assembled motor vehicles,'' after 
    ``scrap,'' in paragraph (1);
        (2) striking ``file with the Commission, and'' in paragraph 
    (1);
        (3) striking ``inspection,'' in paragraph (1) and inserting 
    ``inspection in an automated tariff system,'';
        (4) striking ``tariff filings'' in paragraph (1) and inserting 
    ``tariffs'';
        (5) striking ``freight forwarder'' in paragraph (1)(C) and 
    inserting ``transportation intermediary, as defined in section 
    3(17)(A),'';
        (6) striking ``and'' at the end of paragraph (1)(D);
        (7) striking ``loyalty contract,'' in paragraph (1)(E);
        (8) striking ``agreement.'' in paragraph (1)(E) and inserting 
    ``agreement; and'';
        (9) adding at the end of paragraph (1) the following:
            ``(F) include copies of any loyalty contract, omitting the 
        shipper's name.''; and
        (10) striking paragraph (2) and inserting the following:
        ``(2) Tariffs shall be made available electronically to any 
    person, without time, quantity, or other limitation, through 
    appropriate access from remote locations, and a reasonable charge 
    may be assessed for such access. No charge may be assessed a 
    Federal agency for such access.''.
    (b) Service Contracts.--Subsection (c) of that section is amended 
to read as follows:
    ``(c) Service Contracts.--
        ``(1) In general.--An individual ocean common carrier or an 
    agreement between or among ocean common carriers may enter into a 
    service contract with one or more shippers subject to the 
    requirements of this Act. The exclusive remedy for a breach of a 
    contract entered into under this subsection shall be an action in 
    an appropriate court, unless the parties otherwise agree. In no 
    case may the contract dispute resolution forum be controlled by or 
    in any way affiliated with a controlled carrier as defined in 
    section 3(8) of this Act, or by the government which owns or 
    controls the carrier.
        ``(2) Filing requirements.--Except for service contracts 
    dealing with bulk cargo, forest products, recycled metal scrap, new 
    assembled motor vehicles, waste paper, or paper waste, each 
    contract entered into under this subsection by an individual ocean 
    common carrier or an agreement shall be filed confidentially with 
    the Commission. Each service contract shall include the following 
    essential terms--
            ``(A) the origin and destination port ranges;
            ``(B) the origin and destination geographic areas in the 
        case of through intermodal movements;
            ``(C) the commodity or commodities involved;
            ``(D) the minimum volume or portion;
            ``(E) the line-haul rate;
            ``(F) the duration;
            ``(G) service commitments; and
            ``(H) the liquidated damages for nonperformance, if any.
        ``(3) Publication of certain terms.--When a service contract is 
    filed confidentially with the Commission, a concise statement of 
    the essential terms described in paragraphs 2 (A), (C), (D), and 
    (F) shall be published and made available to the general public in 
    tariff format.
        ``(4) Disclosure of certain terms.--
            ``(A) An ocean common carrier, which is a party to or is 
        subject to the provisions of a collective bargaining agreement 
        with a labor organization, shall, in response to a written 
        request by such labor organization, state whether it is 
        responsible for the following work at dock areas and within 
        port areas in the United States with respect to cargo 
        transportation under a service contract described in paragraph 
        (1) of this subsection--
                ``(i) the movement of the shipper's cargo on a dock 
            area or within the port area or to or from railroad cars on 
            a dock area or within the port area;
                ``(ii) the assignment of intraport carriage of the 
            shipper's cargo between areas on a dock or within the port 
            area;
                ``(iii) the assignment of the carriage of the shipper's 
            cargo between a container yard on a dock area or within the 
            port area and a rail yard adjacent to such container yard; 
            and
                ``(iv) the assignment of container freight station work 
            and container maintenance and repair work performed at a 
            dock area or within the port area.
            ``(B) The common carrier shall provide the information 
        described in subparagraph (A) of this paragraph to the 
        requesting labor organization within a reasonable period of 
        time.
            ``(C) This paragraph requires the disclosure of information 
        by an ocean common carrier only if there exists an applicable 
        and otherwise lawful collective bargaining agreement which 
        pertains to that carrier. No disclosure made by an ocean common 
        carrier shall be deemed to be an admission or agreement that 
        any work is covered by a collective bargaining agreement. Any 
        dispute regarding whether any work is covered by a collective 
        bargaining agreement and the responsibility of the ocean common 
        carrier under such agreement shall be resolved solely in 
        accordance with the dispute resolution procedures contained in 
        the collective bargaining agreement and the National Labor 
        Relations Act, and without reference to this paragraph.
            ``(D) Nothing in this paragraph shall have any effect on 
        the lawfulness or unlawfulness under this Act, the National 
        Labor Relations Act, the Taft-Hartley Act, the Federal Trade 
        Commission Act, the antitrust laws, or any other Federal or 
        State law, or any revisions or amendments thereto, of any 
        collective bargaining agreement or element thereof, including 
        any element that constitutes an essential term of a service 
        contract under this subsection.
            ``(E) For purposes of this paragraph the terms `dock area' 
        and `within the port area' shall have the same meaning and 
        scope as in the applicable collective bargaining agreement 
        between the requesting labor organization and the carrier.''.
    (c) Rates.--Subsection (d) of that section is amended by--
        (1) striking the subsection caption and inserting ``(d) Tariff 
    Rates.--'';
        (2) striking ``30 days after filing with the Commission.'' in 
    the first sentence and inserting ``30 calendar days after 
    publication.'';
        (3) inserting ``calendar'' after ``30'' in the next sentence; 
    and
        (4) striking ``publication and filing with the Commission.'' in 
    the last sentence and inserting ``publication.''.
    (d) Refunds.--Subsection (e) of that section is amended by--
        (1) striking ``tariff of a clerical or administrative nature or 
    an error due to inadvertence'' in paragraph (1) and inserting a 
    comma; and
        (2) striking ``file a new tariff,'' in paragraph (1) and 
    inserting ``publish a new tariff, or an error in quoting a 
    tariff,'';
        (3) striking ``refund, filed a new tariff with the Commission'' 
    in paragraph (2) and inserting ``refund for an error in a tariff or 
    a failure to publish a tariff, published a new tariff'';
        (4) inserting ``and'' at the end of paragraph (2); and
        (5) striking paragraph (3) and redesignating paragraph (4) as 
    paragraph (3).
    (e) Marine Terminal Operator Schedules.--Subsection (f) of that 
section is amended to read as follows:
    ``(f) Marine Terminal Operator Schedules.--A marine terminal 
operator may make available to the public, subject to section 10(d) of 
this Act, a schedule of rates, regulations, and practices, including 
limitations of liability for cargo loss or damage, pertaining to 
receiving, delivering, handling, or storing property at its marine 
terminal. Any such schedule made available to the public shall be 
enforceable by an appropriate court as an implied contract without 
proof of actual knowledge of its provisions.''.
    (f) Automated Tariff System Requirements; Form.--Section 8 of that 
Act is amended by adding at the end the following:
    ``(g) Regulations.--The Commission shall by regulation prescribe 
the requirements for the accessibility and accuracy of automated tariff 
systems established under this section. The Commission may, after 
periodic review, prohibit the use of any automated tariff system that 
fails to meet the requirements established under this section. The 
Commission may not require a common carrier to provide a remote 
terminal for access under subsection (a)(2). The Commission shall by 
regulation prescribe the form and manner in which marine terminal 
operator schedules authorized by this section shall be published.''.

SEC. 107. AUTOMATED TARIFF FILING AND INFORMATION SYSTEM.

    Section 502 of the High Seas Driftnet Fisheries Enforcement Act (46 
U.S.C. App. 1707a) is repealed.

SEC. 108. CONTROLLED CARRIERS.

    Section 9 of the Shipping Act of 1984 (46 U.S.C. App. 1708) is 
amended by--
        (1) striking ``service contracts filed with the Commission'' in 
    the first sentence of subsection (a) and inserting ``service 
    contracts, or charge or assess rates,'';
        (2) striking ``or maintain'' in the first sentence of 
    subsection (a) and inserting ``maintain, or enforce'';
        (3) striking ``disapprove'' in the third sentence of subsection 
    (a) and inserting ``prohibit the publication or use of''; and
        (4) striking ``filed by a controlled carrier that have been 
    rejected, suspended, or disapproved by the Commission'' in the last 
    sentence of subsection (a) and inserting ``that have been suspended 
    or prohibited by the Commission'';
        (5) striking ``may take into account appropriate factors 
    including, but not limited to, whether--'' in subsection (b) and 
    inserting ``shall take into account whether the rates or charges 
    which have been published or assessed or which would result from 
    the pertinent classifications, rules, or regulations are below a 
    level which is fully compensatory to the controlled carrier based 
    upon that carrier's actual costs or upon its constructive costs. 
    For purposes of the preceding sentence, the term `constructive 
    costs' means the costs of another carrier, other than a controlled 
    carrier, operating similar vessels and equipment in the same or a 
    similar trade. The Commission may also take into account other 
    appropriate factors, including but not limited to, whether--'';
        (6) striking paragraph (1) of subsection (b) and redesignating 
    paragraphs (2), (3), and (4) as paragraphs (1), (2), and (3), 
    respectively;
        (7) striking ``filed'' in paragraph (1) as redesignated and 
    inserting ``published or assessed'';
        (8) striking ``filing with the Commission.'' in subsection (c) 
    and inserting ``publication.'';
        (9) striking ``Disapproval of Rates.--'' in subsection (d) and 
    inserting ``Prohibition of Rates.--Within 120 days after the 
    receipt of information requested by the Commission under this 
    section, the Commission shall determine whether the rates, charges, 
    classifications, rules, or regulations of a controlled carrier may 
    be unjust and unreasonable.'';
        (10) striking ``filed'' in subsection (d) and inserting 
    ``published or assessed'';
        (11) striking ``may issue'' in subsection (d) and inserting 
    ``shall issue'';
        (12) striking ``disapproved.'' in subsection (d) and inserting 
    ``prohibited.'';
        (13) striking ``60'' in subsection (d) and inserting ``30'';
        (14) inserting ``controlled'' after ``affected'' in subsection 
    (d);
        (15) striking ``file'' in subsection (d) and inserting 
    ``publish'';
        (16) striking ``disapproval'' in subsection (e) and inserting 
    ``prohibition'';
        (17) inserting ``or'' after the semicolon in subsection (f)(1);
        (18) striking paragraphs (2), (3), and (4) of subsection (f); 
    and
        (19) redesignating paragraph (5) of subsection (f) as paragraph 
    (2).

SEC. 109. PROHIBITED ACTS.

    (a) Section 10(b) of the Shipping Act of 1984 (46 U.S.C. App. 
1709(b)) is amended by--
        (1) striking paragraphs (1) through (3);
        (2) redesignating paragraph (4) as paragraph (1);
        (3) inserting after paragraph (1), as redesignated, the 
    following:
        ``(2) provide service in the liner trade that--
            ``(A) is not in accordance with the rates, charges, 
        classifications, rules, and practices contained in a tariff 
        published or a service contract entered into under section 8 of 
        this Act unless excepted or exempted under section 8(a)(1) or 
        16 of this Act; or
            ``(B) is under a tariff or service contract which has been 
        suspended or prohibited by the Commission under section 9 of 
        this Act or the Foreign Shipping Practices Act of 1988 (46 
        U.S.C. App. 1710a);'';
        (4) redesignating paragraphs (5) and (6) as paragraphs (3) and 
    (4), respectively;
        (5) striking ``except for service contracts,'' in paragraph 
    (4), as redesignated, and inserting ``for service pursuant to a 
    tariff,'';
        (6) striking ``rates;'' in paragraph (4)(A), as redesignated, 
    and inserting ``rates or charges;'';
        (7) inserting after paragraph (4), as redesignated, the 
    following:
        ``(5) for service pursuant to a service contract, engage in any 
    unfair or unjustly discriminatory practice in the matter of rates 
    or charges with respect to any port;'';
        (8) redesignating paragraphs (7) and (8) as paragraphs (6) and 
    (7), respectively;
        (9) striking paragraph (6) as redesignated and inserting the 
    following:
        ``(6) use a vessel or vessels in a particular trade for the 
    purpose of excluding, preventing, or reducing competition by 
    driving another ocean common carrier out of that trade;'';
        (10) striking paragraphs (9) through (13) and inserting the 
    following:
        ``(8) for service pursuant to a tariff, give any undue or 
    unreasonable preference or advantage or impose any undue or 
    unreasonable prejudice or disadvantage;
        ``(9) for service pursuant to a service contract, give any 
    undue or unreasonable preference or advantage or impose any undue 
    or unreasonable prejudice or disadvantage with respect to any port;
        ``(10) unreasonably refuse to deal or negotiate;'';
        (11) redesignating paragraphs (14), (15), and (16) as 
    paragraphs (11), (12), and (13), respectively;
        (12) striking ``a non-vessel-operating common carrier'' in 
    paragraphs (11) and (12) as redesignated and inserting ``an ocean 
    transportation intermediary'';
        (13) striking ``sections 8 and 23'' in paragraphs (11) and (12) 
    as redesignated and inserting ``sections 8 and 19'';
        (14) striking ``or in which an ocean transportation 
    intermediary is listed as an affiliate'' in paragraph (12), as 
    redesignated;
        (15) striking ``Act;'' in paragraph (12), as redesignated, and 
    inserting ``Act, or with an affiliate of such ocean transportation 
    intermediary;''
        (16) striking ``paragraph (16)'' in the matter appearing after 
    paragraph (13), as redesignated, and inserting ``paragraph (13)''; 
    and
        (17) inserting ``the Commission,'' after ``United States,'' in 
    such matter.
    (b) Section 10(c) of the Shipping Act of 1984 (46 U.S.C. App. 
1709(c)) is amended by--
        (1) striking ``non-ocean carriers'' in paragraph (4) and 
    inserting ``non-ocean carriers, unless such negotiations and any 
    resulting agreements are not in violation of the antitrust laws and 
    are consistent with the purposes of this Act'';
        (2) striking ``freight forwarder'' in paragraph (5) and 
    inserting ``transportation intermediary, as defined by section 
    3(17)(A) of this Act,'';
        (3) striking ``or'' at the end of paragraph (5);
        (4) striking ``contract.'' in paragraph (6) and inserting 
    ``contract;''; and
        (5) adding at the end the following:
        ``(7) for service pursuant to a service contract, engage in any 
    unjustly discriminatory practice in the matter of rates or charges 
    with respect to any locality, port, or persons due to those 
    persons' status as shippers' associations or ocean transportation 
    intermediaries; or
        ``(8) for service pursuant to a service contract, give any 
    undue or unreasonable preference or advantage or impose any undue 
    or unreasonable prejudice or disadvantage with respect to any 
    locality, port, or persons due to those persons' status as 
    shippers' associations or ocean transportation intermediaries;''.
    (c) Section 10(d) of the Shipping Act of 1984 (46 U.S.C. App. 
1709(d)) is amended by--
        (1) striking ``freight forwarders,'' and inserting 
    ``transportation intermediaries,'';
        (2) striking ``freight forwarder,'' in paragraph (1) and 
    inserting ``transportation intermediary,'';
        (3) striking ``subsection (b)(11), (12), and (16)'' and 
    inserting ``subsections (b)(10) and (13)''; and
        (4) adding at the end thereof the following:
        ``(4) No marine terminal operator may give any undue or 
    unreasonable preference or advantage or impose any undue or 
    unreasonable prejudice or disadvantage with respect to any person.
        ``(5) The prohibition in subsection (b)(13) of this section 
    applies to ocean transportation intermediaries, as defined by 
    section 3(17)(A) of this Act.''.
    SEC. 110. COMPLAINTS, INVESTIGATIONS, REPORTS, AND REPARATIONS.
    Section 11(g) of the Shipping Act of 1984 (46 U.S.C. App. 1710(g)) 
is amended by--
        (1) striking ``section 10(b)(5) or (7)'' and inserting 
    ``section 10(b)(3) or (6)''; and
        (2) striking ``section 10(b)(6)(A) or (B)'' and inserting 
    ``section 10(b)(4)(A) or (B).''.

SEC. 111. FOREIGN SHIPPING PRACTICES ACT OF 1988.

    Section 10002 of the Foreign Shipping Practices Act of 1988 (46 
U.S.C. App. 1710a) is amended by--
        (1) striking ```non-vessel-operating common carrier','' in 
    subsection (a)(1) and inserting ```ocean transportation 
    intermediary','';
        (2) striking ``forwarding and'' in subsection (a)(4);
        (3) striking ``non-vessel-operating common carrier'' in 
    subsection (a)(4) and inserting ``ocean transportation intermediary 
    services and'';
        (4) striking ``freight forwarder,'' in subsections (c)(1) and 
    (d)(1) and inserting ``transportation intermediary,'';
        (5) striking ``filed with the Commission,'' in subsection 
    (e)(1)(B) and inserting ``and service contracts,'';
        (6) inserting ``and service contracts'' after ``tariffs'' the 
    second place it appears in subsection (e)(1)(B); and
        (7) striking ``(b)(5)'' each place it appears in subsection (h) 
    and inserting ``(b)(6)''.

SEC. 112. PENALTIES.

    (a) Section 13(a) of the Shipping Act of 1984 (46 U.S.C. App. 
1712(a)) is amended by adding at the end thereof the following: ``The 
amount of any penalty imposed upon a common carrier under this 
subsection shall constitute a lien upon the vessels operated by that 
common carrier and any such vessel may be libeled therefore in the 
district court of the United States for the district in which it may be 
found.''.
    (b) Section 13(b) of the Shipping Act of 1984 (46 U.S.C. App. 
1712(b)) is amended by--
        (1) striking ``section 10(b)(1), (2), (3), (4), or (8)'' in 
    paragraph (1) and inserting ``section 10(b)(1), (2), or (7)'';
        (2) by redesignating paragraphs (4), (5), and (6) as paragraphs 
    (5), (6), and (7), respectively;
        (3) inserting before paragraph (5), as redesignated, the 
    following:
        ``(4) If the Commission finds, after notice and an opportunity 
    for a hearing, that a common carrier has failed to supply 
    information ordered to be produced or compelled by subpoena under 
    section 12 of this Act, the Commission may request that the 
    Secretary of the Treasury refuse or revoke any clearance required 
    for a vessel operated by that common carrier. Upon request by the 
    Commission, the Secretary of the Treasury shall, with respect to 
    the vessel concerned, refuse or revoke any clearance required by 
    section 4197 of the Revised Statutes of the United States (46 
    U.S.C. App. 91).''; and
        (4) striking ``paragraphs (1), (2), and (3)'' in paragraph (6), 
    as redesignated, and inserting ``paragraphs (1), (2), (3), and 
    (4)''.
    (c) Section 13(f)(1) of the Shipping Act of 1984 (46 U.S.C. App. 
1712(f)(1)) is amended by--
        (1) striking ``or (b)(4)'' and inserting ``or (b)(2)'';
        (2) striking ``(b)(1), (4)'' and inserting ``(b)(1), (2)''; and
        (3) adding at the end thereof the following ``Neither the 
    Commission nor any court shall order any person to pay the 
    difference between the amount billed and agreed upon in writing 
    with a common carrier or its agent and the amount set forth in any 
    tariff or service contract by that common carrier for the 
    transportation service provided.''.

SEC. 113. REPORTS AND CERTIFICATES.

    Section 15 of the Shipping Act of 1984 (46 U.S.C. App. 1714) is 
amended by--
        (1) striking ``and certificates'' in the section heading;
        (2) striking ``(a) Reports.--'' in the subsection heading for 
    subsection (a); and
        (3) striking subsection (b).

SEC. 114. EXEMPTIONS.

    Section 16 of the Shipping Act of 1984 (46 U.S.C. App. 1715) is 
amended by striking ``substantially impair effective regulation by the 
Commission, be unjustly discriminatory, result in a substantial 
reduction in competition, or be detrimental to commerce.'' and 
inserting ``result in substantial reduction in competition or be 
detrimental to commerce.''.

SEC. 115. AGENCY REPORTS AND ADVISORY COMMISSION.

    Section 18 of the Shipping Act of 1984 (46 U.S.C. App. 1717) is 
repealed.

SEC. 116. OCEAN FREIGHT FORWARDERS.

    Section 19 of the Shipping Act of 1984 (46 U.S.C. App. 1718) is 
amended by--
        (1) striking ``freight forwarders'' in the section caption and 
    inserting ``transportation intermediaries'';
        (2) striking subsection (a) and inserting the following:
    ``(a) License.--No person in the United States may act as an ocean 
transportation intermediary unless that person holds a license issued 
by the Commission. The Commission shall issue an intermediary's license 
to any person that the Commission determines to be qualified by 
experience and character to act as an ocean transportation 
intermediary.'';
        (3) redesignating subsections (b), (c), and (d) as subsections 
    (c), (d), and (e), respectively;
        (4) inserting after subsection (a) the following:
    ``(b) Financial Responsibility.--
        ``(1) No person may act as an ocean transportation intermediary 
    unless that person furnishes a bond, proof of insurance, or other 
    surety in a form and amount determined by the Commission to insure 
    financial responsibility that is issued by a surety company found 
    acceptable by the Secretary of the Treasury.
        ``(2) A bond, insurance, or other surety obtained pursuant to 
    this section--
            ``(A) shall be available to pay any order for reparation 
        issued pursuant to section 11 or 14 of this Act, or any penalty 
        assessed pursuant to section 13 of this Act;
            ``(B) may be available to pay any claim against an ocean 
        transportation intermediary arising from its transportation-
        related activities described in section 3(17) of this Act with 
        the consent of the insured ocean transportation intermediary 
        and subject to review by the surety company, or when the claim 
        is deemed valid by the surety company after the ocean 
        transportation intermediary has failed to respond to adequate 
        notice to address the validity of the claim; and
            ``(C) shall be available to pay any judgment for damages 
        against an ocean transportation intermediary arising from its 
        transportation-related activities under section 3(17) of this 
        Act, provided the claimant has first attempted to resolve the 
        claim pursuant to subparagraph (B) of this paragraph and the 
        claim has not been resolved within a reasonable period of time.
        ``(3) The Commission shall prescribe regulations for the 
    purpose of protecting the interests of claimants, ocean 
    transportation intermediaries, and surety companies with respect to 
    the process of pursuing claims against ocean transportation 
    intermediary bonds, insurance, or sureties through court judgments. 
    The regulations shall provide that a judgment for monetary damages 
    may not be enforced except to the extent that the damages claimed 
    arise from the transportation-related activities of the insured 
    ocean transportation intermediary, as defined by the Commission.
        ``(4) An ocean transportation intermediary not domiciled in the 
    United States shall designate a resident agent in the United States 
    for receipt of service of judicial and administrative process, 
    including subpoenas.'';
        (5) striking, each place such term appears--
            (A) ``freight forwarder'' and inserting ``transportation 
        intermediary'';
            (B) ``a forwarder's'' and inserting ``an intermediary's'';
            (C) ``forwarder'' and inserting ``intermediary''; and
            (D) ``forwarding'' and inserting ``intermediary'';
        (6) striking ``a bond in accordance with subsection (a)(2).'' 
    in subsection (c), as redesignated, and inserting ``a bond, proof 
    of insurance, or other surety in accordance with subsection 
    (b)(1).'';
        (7) striking ``Forwarders.--''  in the caption of subsection 
    (e), as redesignated, and inserting ``Intermediaries.--'';
        (8) striking ``intermediary'' the first place it appears in 
    subsection (e)(1), as redesignated and as amended by paragraph 
    (5)(A), and inserting ``intermediary, as defined in section 
    3(17)(A) of this Act,'';
        (9) striking ``license'' in paragraph (1) of subsection (e), as 
    redesignated, and inserting ``license, if required by subsection 
    (a),'';
        (10) striking paragraph (3) of subsection (e), as redesignated, 
    and redesignating paragraph (4) as paragraph (3); and
        (11) adding at the end of subsection (e), as redesignated, the 
    following:
        ``(4) No conference or group of 2 or more ocean common carriers 
    in the foreign commerce of the United States that is authorized to 
    agree upon the level of compensation paid to an ocean 
    transportation intermediary, as defined in section 3(17)(A) of this 
    Act, may--
            ``(A) deny to any member of the conference or group the 
        right, upon notice of not more than 5 calendar days, to take 
        independent action on any level of compensation paid to an 
        ocean transportation intermediary, as so defined; or
            ``(B) agree to limit the payment of compensation to an 
        ocean transportation intermediary, as so defined, to less than 
        1.25 percent of the aggregate of all rates and charges which 
        are applicable under a tariff and which are assessed against 
        the cargo on which the intermediary services are provided.''.
    SEC. 117. CONTRACTS, AGREEMENTS, AND LICENSES UNDER PRIOR SHIPPING 
      LEGISLATION.
    Section 20 of the Shipping Act of 1984 (46 U.S.C. App. 1719) is 
amended by--
        (1) striking subsection (d) and inserting the following:
    ``(d) Effects on Certain Agreements and Contracts.--All agreements, 
contracts, modifications, licenses, and exemptions previously issued, 
approved, or effective under the Shipping Act, 1916, or the Shipping 
Act of 1984, shall continue in force and effect as if issued or 
effective under this Act, as amended by the Ocean Shipping Reform Act 
of 1998, and all new agreements, contracts, and modifications to 
existing, pending, or new contracts or agreements shall be considered 
under this Act, as amended by the Ocean Shipping Reform Act of 1998.'';
        (2) inserting the following at the end of subsection (e):
        ``(3) The Ocean Shipping Reform Act of 1998 shall not affect 
    any suit--
            ``(A) filed before the effective date of that Act; or
            ``(B) with respect to claims arising out of conduct engaged 
        in before the effective date of that Act filed within 1 year 
        after the effective date of that Act.
        ``(4) Regulations issued by the Federal Maritime Commission 
    shall remain in force and effect where not inconsistent with this 
    Act, as amended by the Ocean Shipping Reform Act of 1998.''.

SEC. 118. SURETY FOR NON-VESSEL-OPERATING COMMON CARRIERS.

    Section 23 of the Shipping Act of 1984 (46 U.S.C. App. 1721) is 
repealed.

  TITLE II--AUTHORIZATION OF APPROPRIATIONS FOR THE FEDERAL MARITIME 
                               COMMISSION

    SEC. 201. AUTHORIZATION OF APPROPRIATIONS FOR FISCAL YEAR 1998.
    There are authorized to be appropriated to the Federal Maritime 
Commission, $15,000,000 for fiscal year 1998.

SEC. 202. FEDERAL MARITIME COMMISSION ORGANIZATION.

    Section 102(d) of Reorganization Plan No. 7 of 1961 (75 Stat. 840) 
is amended to read as follows:
    ``(d) A vacancy or vacancies in the membership of Commission shall 
not impair the power of the Commission to execute its functions. The 
affirmative vote of a majority of the members serving on the Commission 
is required to dispose of any matter before the Commission.''.

SEC. 203. REGULATIONS.

    Not later than March 1, 1999, the Federal Maritime Commission shall 
prescribe final regulations to implement the changes made by this Act.

       TITLE III--AMENDMENTS TO OTHER SHIPPING AND MARITIME LAWS

    SEC. 301. AMENDMENTS TO SECTION 19 OF THE MERCHANT MARINE ACT, 
      1920.
    (a) In General.--Section 19 of the Merchant Marine Act, 1920 (46 
U.S.C. App. 876) is amended by--
        (1) striking ``forwarding and'' in subsection (1)(b);
        (2) striking ``non-vessel-operating common carrier 
    operations,'' in subsection (1)(b) and inserting ``ocean 
    transportation intermediary services and operations,'';
        (3) striking ``methods or practices'' and inserting ``methods, 
    pricing practices, or other practices'' in subsection (1)(b);
        (4) striking ``tariffs of a common carrier'' in subsection 7(d) 
    and inserting ``tariffs and service contracts of a common 
    carrier'';
        (5) striking ``use the tariffs of conferences'' in subsections 
    (7)(d) and (9)(b) and inserting ``use tariffs of conferences and 
    service contracts of agreements'';
        (6) striking ``tariffs filed with the Commission'' in 
    subsection (9)(b) and inserting ``tariffs and service contracts'';
        (7) striking ``freight forwarder,'' each place it appears and 
    inserting ``transportation intermediary,''; and
        (8) striking ``tariff'' each place it appears in subsection 
    (11) and inserting ``tariff or service contract''.
    (b) Stylistic Conformity.--Section 19 of the Merchant Marine Act, 
1920 (46 U.S.C. App. 876), as amended by subsection (a), is further 
amended by--
        (1) redesignating subdivisions (1) through (12) as subsections 
    (a) through (l), respectively;
        (2) redesignating subdivisions (a), (b), and (c) of subsection 
    (a), as redesignated, as paragraphs (1), (2), and (3);
        (3) redesignating subdivisions (a) through (d) of subsection 
    (f), as redesignated, as paragraphs (1) through (4), respectively;
        (4) redesignating subdivisions (a) through (e) of subsection 
    (g), as redesignated, as paragraphs (1) through (5), respectively;
        (5) redesignating clauses (i) and (ii) of subsection (g)(4), as 
    redesignated, as subparagraphs (A) and (B), respectively;
        (6) redesignating subdivisions (a) through (e) of subsection 
    (i), as redesignated, as paragraphs (1) through (5), respectively;
        (7) redesignating subdivisions (a) and (b) of subsection (j), 
    as redesignated, as paragraphs (1) and (2), respectively;
        (8) striking ``subdivision (c) of paragraph (1)'' in subsection 
    (c), as redesignated, and inserting ``subsection (a)(3)'';
        (9) striking ``paragraph (2)'' in subsection (c), as 
    redesignated, and inserting ``subsection (b)'';
        (10) striking ``paragraph (1)(b)'' each place it appears and 
    inserting ``subsection (a)(2)'';
        (11) striking ``subdivision (b),'' in subsection (g)(4), as 
    redesignated, and inserting ``paragraph (2),'';
        (12) striking ``paragraph (9)(d)'' in subsection (j)(1), as 
    redesignated, and inserting ``subsection (i)(4)''; and
        (13) striking ``paragraph (7)(d) or (9)(b)'' in subsection (k), 
    as redesignated, and inserting ``subsection (g)(4) or (i)(2)''.

SEC. 302. TECHNICAL CORRECTIONS.

    (a) Public Law 89-777.--Sections 2 and 3 of the Act of November 6, 
1966 (46 U.S.C. App. 817d and 817e) are amended by striking ``they in 
their discretion'' each place it appears and inserting ``it in its 
discretion''.
    (b) Tariff Act of 1930.--Section 641(i) of the Tariff Act of 1930 
(19 U.S.C. 1641) is repealed.

           TITLE IV--CERTAIN LOAN GUARANTEES AND COMMITMENTS

SEC. 401. CERTAIN LOAN GUARANTEES AND COMMITMENTS.

    (a) The Secretary of Transportation may not issue a guarantee or 
commitment to guarantee a loan for the construction, reconstruction, or 
reconditioning of a liner vessel under the authority of title XI of the 
Merchant Marine Act, 1936 (46 U.S.C. App. 1271 et seq.) after the date 
of enactment of this Act unless the Chairman of the Federal Maritime 
Commission certifies that the operator of such vessel--
        (1) has not been found by the Commission to have violated 
    section 19 of the Merchant Marine Act, 1920 (46 U.S.C. App. 876), 
    or the Foreign Shipping Practices Act of 1988 (46 U.S.C. App. 
    1701a), within the previous 5 years; and
        (2) has not been found by the Commission to have committed a 
    violation of the Shipping Act of 1984 (46 U.S.C. App. 1701 et 
    seq.), which involves unjust or unfair discriminatory treatment or 
    undue or unreasonable prejudice or disadvantage with respect to a 
    United States shipper, ocean transportation intermediary, ocean 
    common carrier, or port within the previous 5 years.
    (b) The Secretary of Commerce may not issue a guarantee or a 
commitment to guarantee a loan for the construction, reconstruction, or 
reconditioning of a fishing vessel under the authority of title XI of 
the Merchant Marine Act, 1936 (46 U.S.C. App. 1271 et seq.) if the 
fishing vessel operator has been--
        (1) held liable or liable in rem for a civil penalty pursuant 
    to section 308 of the Magnuson-Stevens Fishery Conservation and 
    Management Act (16 U.S.C. 1858) and not paid the penalty;
        (2) found guilty of an offense pursuant to section 309 of the 
    Magnuson-Stevens Fishery Conservation and Management Act (16 U.S.C. 
    1859) and not paid the assessed fine or served the assessed 
    sentence;
        (3) held liable for a civil or criminal penalty pursuant to 
    section 105 of the Marine Mammal Protection Act of 1972 (16 U.S.C. 
    1375) and not paid the assessed fine or served the assessed 
    sentence; or
        (4) held liable for a civil penalty by the Coast Guard pursuant 
    to title 33 or 46, United States Code, and not paid the assessed 
    fine.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.