Short title

This Act may be cited as the

Shipping Act of 2010

References

Except as otherwise expressly provided, whenever in this Act an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of title 46, United States Code.

Office of Dispute Resolution and Customer Advocate

(a)

In general

Chapter 3 is amended by adding at the end the following new section:

308.

Office of Dispute Resolution and Customer Advocate

(a)

In general

(1)The Commission shall maintain an Office of Dispute Resolution and Customer Advocate that shall— (A)mediate disputes between persons subject to the Commission’s jurisdiction; (B)facilitate communication among persons subject to the Commission’s jurisdiction and their customers; and (C)carry out other duties and powers prescribed by the Commission. (2)The confidentiality and neutrality provisions of the subchapter IV of chapter 5, United States Code, shall apply to those mediation and facilitation services. (b)

Ombudsman

The Chairman may designate an employee of the Commission to serve as an ombudsman of the Commission in matters of Commission interest, including matters related to ocean transportation, mergers and acquisitions, or any other matter designated by the Commission.

(b)

Conforming amendment

The analysis at the beginning of such chapter is amended by adding at the end the following new item:

308. Office of Dispute Resolution and Customer Advocate.

Ocean Shipping Advisory Committee

(a)

In general

Chapter 3 is further amended by adding at the end the following new section:

309.

Ocean Shipping Advisory Committee

(a)

In general

The Commission shall establish an Ocean Shipping Advisory Committee. The Committee— (1)may review proposed ocean shipping regulations and policies of the Commission and make recommendations to the Commission that the Committee considers appropriate; (2)may advise, consult with, report to, and, upon approval by at least all but one of the members then serving on the Committee, make recommendations to the Commission on matters relating to ocean shipping transportation by persons subject to this subtitle; (3)may make available to Congress recommendations that the Committee makes to the Commission; (4)shall meet at the call of— (A)the Chairman of the Commission, in consultation with the other Commissioners, who shall call such a meeting at least once during each calendar year; or (B)a majority of the Committee; and (5)shall not intervene in or seek to influence formal or informal adjudicatory or dispute resolution proceedings before the Commission. (b)

Membership

(1)

In general

The Committee shall consist of 18 members appointed by the Commission in accordance with this subsection, each of whom has at least 5 years practical experience in their respective ocean shipping operations. The term of each member shall be 5 years. Before filling a position on the Committee, the Commission shall publish a notice in the Federal Register soliciting nominations for membership on the Committee. (2)

Representatives

The membership of the Committee shall include— (A)6 representatives of ocean common carriers with representation to include those serving the east, west, gulf and Great Lakes coasts of the United States; (B)3 representatives of nonvessel-operating common carriers; (C)3 representatives of ocean freight forwarders; (D)3 representatives of shippers that import goods into the United States, at least one of which must represent small shippers; and (E)3 representatives of shippers that export goods from the United States, at least one of which must represent small shippers. (c)

Chairman and Vice Chairman

(1)

In general

The Committee shall elect one of its members as the Chairman and one of its members as the Vice Chairman. The Vice Chairman shall act as Chairman in the absence or incapacity of the Chairman, or in the event of a vacancy in the office of the Chairman. (2)

Designation of observer

The Chairman of the Commission shall designate a representative to participate as an observer with the Committee. The individual so designated shall act as the executive secretary of the Committee and shall perform the duties set forth in section 10(c) of the Federal Advisory Committee Act (5 U.S.C. App.). (d)

Consideration of information, advice, and recommendations

The Commission shall consider the information, advice, and recommendations of the Committee in formulating policy regarding matters affecting ocean commerce. (e)

Compensation and expenses

(1)

In general

A member of the Committee, when attending meetings of the Committee or when otherwise engaged in the business of the Committee, may receive— (A)compensation at a rate fixed by the Chairman of the Commission, not exceeding the daily equivalent of the then current rate of basic pay in effect for Level 18 of the General Schedule under section 5332 of title 5, including for travel time; and (B)travel or transportation expenses under section 5703 of title 5. (2)

Not an officer or employee

A member of the Committee shall not be considered to be an officer or employee of the United States for any purpose based on their receipt of any payment under this subsection. (f)

Termination

(1)

In general

Notwithstanding any provision of the Federal Advisory Committee Act (5 U.S.C. App.), the Committee terminates on September 30, 2015. (2)

Recommendation regarding

Two years before the termination date under paragraph (1), the Committee shall submit to Congress its recommendation regarding whether the Committee should be renewed and continued beyond the termination date.

(b)

Conforming amendment

The analysis at the beginning of such chapter is amended by adding at the end the following new item:

309. Ocean Shipping Advisory Committee.

Purposes of regulation of ocean shipping

Section 40101(3) is amended to read as follows:

(3)to allow, to the maximum extent possible, competition and the demand for services to determine fair and efficient market rates and charges for transportation by common carriers; and

Amendments to definitions for part

(a)

In general

Section 40102 is amended— (1)by striking paragraph (7); (2)by redesignating paragraphs (5) and (6) as paragraphs (6) and (7), respectively; (3)by redesignating paragraphs (10) through (22) as paragraphs (12) through (24), respectively; (4)by redesignating paragraphs (23) through (25) as paragraphs (26) through (28), respectively; (5)by inserting after paragraph (4) the following:

(5)

Capacity rationalization

The term capacity rationalization means a concerted reduction, stabilization, withholding, or other limitation in any manner by ocean common carriers on the size or number of vessels or available space offered collectively or individually to shippers in any trade or service.

;

(6)by striking ocean in paragraph (8); (7)by inserting after paragraph (9) the following:

(10)

Efficiency and service-enhancing agreement

The term efficiency and service-enhancing agreement means an agreement between ocean common carriers that— (A)is likely to produce cognizable efficiencies and improves the service and reliability that would be offered individually by each of its members in the absence of such agreement, while maintaining adequate competition in a trade or service; and (B)gives members of the agreement the right to withdraw from the agreement without financial or other penalty. (11)

Equipment provider

The term equipment provider means a person in the United States that rents or leases marine cargo containers, or chassis for marine cargo containers, to shippers or common carriers for use in or related to transportation by water of cargo between the United States and a foreign country.

;

(8)by amending paragraph (22), as so redesignated, to read as follows:

(22)

Service contract

The term service contract means a written contract, other than a bill of lading or receipt, between one or more shippers and a common carrier, in which— (A)the shipper or shippers commit to providing a certain volume or portion of cargo over a fixed time period; and (B)the common carrier commits to a certain rate or rate schedule and a defined service level that includes assured space and other service features.

; and

(9)by inserting after paragraph (24), as so redesignated, the following:

(25)

Surcharge

The term surcharge means an amount charged by a common carrier related directly to a particular expense or cost incurred by the common carrier that is not included in the basic freight rate.

(b)

Conforming amendment

Section 431A(b)(1) of the Tariff Act of 1930 (19 U.S.C. Sec. 1431a(b)(1)) is amended by striking section 40102(16) and inserting section 40102(18).

Administrative exemptions

Section 40103(a) is amended by striking agreements and all that follows through from any requirement and inserting agreements subject to this part or any specified activity of persons subject to this part from any requirement.

Treatment of certain commission orders as investigative orders

Section 40104(b) is amended to read as follows:

(b)

Treatment of certain Commission orders as investigative orders

A Commission order requiring a report, account, record, rate, charge, or memorandum pursuant to subsection (a) constitutes an investigative order to specific individuals or entities rather than a collection of information from a category or class of individuals or entities.

Application of laws regulating ocean shipping

Section 40301 is amended as follows: (1)By amending subsection (a) to read as follows:

(a)

Ocean common carrier agreements

This part applies to an efficiency and service-enhancing agreement between or among ocean common carriers to— (1)share vessels or space on voyages between ports; (2)discuss the number and character of voyages between those ports; and (3)engage in an exclusive, preferential, or cooperative working arrangement between themselves or with a marine terminal operator.

(2)In subsection (c) by inserting before the period the following: that does not result in a change of control of an ocean common carrier.

10.

Restrictions on ocean common carrier agreements

(a)

In general

Section 40303 is amended as follows: (1)By striking so much as precedes subsection (d) and inserting the following:

(a)

Ocean common carrier agreements

An agreement between or among ocean common carriers may not— (1)allow members of the agreement to discuss, fix, or negotiate any kind of rate or charge with another member of the agreement; (2)allow members of the agreement to discuss or agree on capacity rationalization; (3)allow members of the agreement to establish a joint service, or pool or divide cargo traffic, earnings, revenues, or losses; (4)allow all members of the agreement to allocate customers or markets; (5)allow members of the agreement to discuss or agree with another member on any service contract matter; (6)prohibit or restrict a member of the agreement from engaging in negotiations for a service contract with a shipper; or (7)require a member of the agreement to disclose a negotiation on a service contract, or the terms of a service contract, other than those terms required to be published under section 40502(d) of this title.

(2)By redesignating subsection (d) as subsection (b). (b)

Conforming amendment

Section 41105(6)(A) is amended by striking 40303(d) and inserting 40303(b).

11.

Commission action

Section 40304 is amended— (1)in subsection (b), by inserting is not an efficiency and service-enhancing agreement or after finds; (2)in subsection (c)— (A)in the matter preceding paragraph (1), by inserting or an ocean common carrier agreement after assessment agreement; and (B)in paragraph (2) by striking (d) and inserting (e); (3)by redesigning subsections (d) through (f) as subsection (e) through (g), respectively; (4)by inserting after subsection (c) the following new subsection:

(d)

Approval by commission

(1)

In general

An ocean common carrier agreement filed under this part is not effective until it is approved by the Commission as meeting the requirements of this part. (2)

Deadline for Approval

Except as provided in subsection (e), the Commission shall vote on whether or not to approve an agreement before the later of— (A)the end of the 90-day period beginning on the date it is filed; or (B)if additional information or documents are requested under subsection (e), the end of the 90-day period beginning on the date the Commission receives all the additional information and documents.

;

(5)in subsection (e), as so redesignated, by inserting or (d) after subsection (c)(1); (6)in subsection (f)(2), as so redesignated— (A)by inserting before the first sentence the following:

(A)

In general

; and

(B)by adding at the end the following new subparagraph:

(B)

Extensions

If a person filing an agreement, or an officer, director, agent, or employee of that person, fails to substantially comply with a request for the submission of additional information or documents within the period provided in subsection (d), the Commission may extend such period until there has been substantial compliance with the request of the Commission under subsection (e).

; and

(7)in subsection (g), as so redesignated, by inserting before the period the following: , except for an agreement approved under subsection (d).

12.

Exemption

Section 40307 is amended— (1)in subsection (a)(7), by inserting before the period the following: to the extent that such an agreement is approved under this part after January 1, 2011; and (2)in subsection (d), by striking by this part and inserting by section 41106.

13.

General rate and tariff requirements

Section 40501 is amended— (1)in subsection (a)(1), by striking Each and all that follows through system, and inserting Each common carrier shall maintain for public inspection in an automated tariff system on the Internet,; (2)in subsection (b)— (A)in paragraphs (3) and (4), by striking or conference each place it appears; and (B)by striking and after the semicolon at the end of paragraph (5), by striking the period at the end of paragraph (6) and inserting a semicolon, and by adding at the end the following new paragraphs:

(7)separately state the charges by the carrier for providing or handling equipment; and (8)clearly describe any surcharge contained in the tariff.

;

(3)in subsection (c), by striking the last sentence and inserting the following: No fee may be charged for such access.; and (4)in subsection (e)(2), by striking on publication and inserting immediately.

14.

Service contracts

Section 40502 is amended— (1)in subsection (a), by striking ocean common carrier or an agreement between or among ocean common carriers and inserting common carrier; (2)in subsection (b)(2), by striking ocean common carrier or an agreement shall be filed and inserting common carrier shall be filed electronically and; (3)in subsection (c)— (A)in paragraph (7), by striking and after the semicolon at the end; (B)in paragraph (8), by striking the period at the end and inserting , by common carrier and shipper parties.; and (C)by adding at the end the following new paragraph:

(9)separately state the charges by the carrier for providing equipment.

;

(4)in subsection (d), by striking and (6) and inserting , (6), and (9); and (5)in subsection (f)— (A)in the first sentence, by striking exclusive; and (B)by adding at the end the following: This subsection does not apply to mediation before the Commission at the request of any party to the service contract or to a dispute covered by section 40505(b) of this title..

15.

Refunds and waivers

Section 40503 is amended by striking or conference each place it appears.

16.

Compilation of complaints and service reliability data

(a)

In general

Chapter 405 is amended by adding at the end the following new section:

40504.

Compilation of complaints and service reliability data

(a)

Database

The Commission shall establish and maintain a database of complaints received by the Commission. (b)

An annual report of service complaints

(1)

In general

The Commission shall post an annual report of formal and informal service complaints received by the Commission during the previous year that shall include— (A)the quantity of each type of complaint; (B)the geographic region of the complaints; and (C)the resolution of the complaints, if appropriate. (2)

Limitation on identification of complainant

The annual report may identify a complainant that submitted an informal complaint only upon the written consent of the complainant. (c)

Reliability indicators

(1)

In general

The Commission shall, by regulation, require ocean common carriers to report frequency and duration of delays in shipments, all instances in which cargo has not been transported on a voyage for which it was booked, and other service or reliability indicators as determined by the Commission to be appropriate. (2)

Annual report

(A)

In general

The Commission shall issue an annual report of service and reliability indicators for each ocean common carrier. (B)

Posting on Internet

The reports shall be posted on the Commission’s public Internet Web site.

(b)

Clerical amendment

The analysis at the beginning of such chapter is amended by adding at the end the following new item:

40504. Compilation of complaints and service reliability data.

17.

Arbitration of disputes

(a)

In general

Chapter 405 is further amended by adding at the end the following new section:

40505.

Arbitration of disputes regarding common carrier services

(a)

In general

Not later than one year after enactment of the Ocean Shipping Act of 2010, the Commission shall prescribe regulations to establish a binding arbitration process to resolve complaints subject to the jurisdiction of the Commission and within the scope of disputes to which the process applies under subsection (b). (b)

Covered disputes

The binding arbitration process— (1)shall apply to disputes involving service contracts, common carrier practices, and common carrier service expectations that are subject to the jurisdiction of the Commission; (2)shall not apply to disputes to obtain the grant, denial, stay, or revocation of any license, authorization, or exemption; (3)shall not apply to disputes solely between 2 or more ocean common carriers; and (4)shall be agreed upon by the parties to dispute. (c)

Arbitration procedures

(1)

In general

The Commission— (A)may make the binding arbitration process available only to the relevant parties— (i)after the filing of a formal complaint; or (ii)on petition by a party at the conclusion of any informal dispute resolution process provided by the Commission for a complaint subject to this section; (B)shall determine whether to pursue a proceeding under the binding arbitration process no later than 30 days after the filing of a petition or formal complaint; and (C)may make the binding arbitration proceeding and decision confidential following a request of the parties submitted at the time of filing the petition or formal complaint. (2)

Prohibition on separate review

The Commission may not separately review a complaint or dispute related to a rate, practice, or common carrier service that is the subject of a binding arbitration initiated under this subsection involving the same parties. (3)

Consideration of published service expectations

In resolving disputes involving common carrier service expectations, the arbitrator shall consider service expectations as published under section 40501(h) of this title. (d)

Arbitration decisions

Any decision reached in an arbitration proceeding under this section shall— (1)be consistent with this part; (2)be in writing and contain findings of fact and conclusions; (3)have no precedential effect in any other or subsequent arbitration proceeding under this section; and (4)be binding upon the parties. (e)

Timelines

(1)

In general

In an arbitration proceeding under this section— (A)the arbitrator shall be selected within 14 days after the Commission’s decision to initiate arbitration; (B)the evidentiary phase of the arbitration shall be completed within 90 days after the date of initiation of the arbitration proceeding, unless a party requests an extension and the arbitrator grants it; and (C)the arbitrator shall issue a decision within 30 days after the close of the evidentiary record. (2)

Extension of deadlines

The Commission may extend any of the deadlines in this subsection. (f)

Arbitrators

Arbitration under this section shall be conducted by an arbitrator selected from a roster, maintained by the Commission, of Commission staff or persons in the private sector with transportation, economic regulation, professional or business experience, including agriculture. If the parties cannot mutually agree on an arbitrator, the parties shall select an arbitrator from the roster by alternately striking names from the roster until only 1 name remains. The parties shall share the costs of the arbitration equally. With respect to arbitration involving a controlled carrier, the arbitrator may not be controlled by or in any way affiliated with a government that owns or controls the carrier. (g)

Relief

(1)

Limitation

A decision under this section may award the payment of damages, but the value of the award may not exceed $250,000 per year and the award may not cover a total time period of more than 2 years. (2)

Review

The Commission shall periodically review the amount in paragraph (1) and adjust it as necessary to reflect inflation. (h)

Commission review

If a party to an arbitration proceeding under this section appeals an arbitrator’s decision to the Commission, the Commission may review the decision under this section to determine if— (1)the decision is consistent with this part as applied by the Commission; or (2)if the award limitation in subsection (g) is complied with.

(b)

Clerical amendment

The analysis at the beginning of such chapter is amended by adding at the end the following new item:

40504. Arbitration of disputes regarding common carrier services.

18.

Clerical amendments relating to controlled carriers

Chapter 407 is amended— (1)by striking the heading for section 40701 and inserting the following:

40701.

Controlled carrier rates

;

(2)by striking the heading for section 40702 and inserting the following:

40702.

Controlled carrier rate standards

;

(3)by striking the heading for section 40703 and inserting the following:

40703.

Effective date of controlled carrier rates

;

and

(4)in the analysis at the beginning of the chapter, by striking the items relating to sections 40701, 40702, and 40703 and inserting the following:

40701. Controlled carrier rates.

40702. Controlled carrier rate standards.

40703. Effective date of controlled carrier rates.

19.

Commission review of rates, charges, etc.: investigation and civil penalties of controlled carriers

Section 40704 is amended— (1)in subsection (b), by adding at the end the following In making this determination, the Commission may investigate any relevant conduct under sections 41302 to 41304 of this title.; and (2)by adding at the end the following new subsection:

(f)

Civil penalties

In addition to any action authorized under this section with respect to a rate, charge, classification, rule, or regulation the Commission determines to be unjust or unreasonable, the Commission may assess civil penalties under section 41109.

20.

Ocean transportation intermediaries: prohibition on advertising

Section 40901(a) is amended in the first sentence by inserting advertise, hold oneself out, or after may not.

21.

Ocean transportation intermediaries: financial responsibility and resident agents

Section 40902 is amended— (1)in subsection (a), by inserting advertise, hold oneself out, or after may not; and (2)in subsection (d), by inserting before the period the following: , and Commission requests or demands for records or reports.

22.

Ocean transportation intermediaries: suspension or revocation of license for failure to comply with commission requests

Section 40903(a) is amended by striking or after the semicolon at the end of paragraph (1), striking the period at the end of paragraph (2) and inserting ; or and by adding at the end the following new paragraph:

(3)failed to comply with a Commission subpoena or request for records.

23.

Repeal of prohibitions of certain payments

Section 40904(d) is amended by striking so much as precedes limit the payment of compensation and inserting the following:

(d)

Prohibition on limiting payment of compensation to an ocean freight forwarder

An ocean common carrier may not

24.

Repeal of definition of joint venture and consortium

(a)

Repeal

Section 41101 is repealed. (b)

Clerical amendment

The analysis at the beginning of chapter 411 is amended by striking the item relating to such section.

25.

Repeal of authorities to disclosure of information

Section 41103 is amended— (1)in subsection (b), by adding or after the semicolon at the end of paragraph (1), striking ; or at the end of paragraph (2) and inserting a period, and striking paragraph (3); and (2)by striking subsection (c).

26.

Additional prohibitions of certain actions by common carriers

(a)

In general

Section 41104 is amended— (1)by redesignating paragraphs (3) through (12) as paragraphs (4) through (13); (2)by inserting after paragraph (2) the following new paragraph:

(3)refuse or threaten to refuse cargo space accommodations when available;

;

(3)in paragraph (4), as so redesignated, by striking refusing, or threatening to refuse, cargo space accommodations when available, or resort to other; (4)by striking or after the semicolon at the end of paragraph (12), as so redesignated; (5)in paragraph (13), as so redesignated, by striking the period and inserting a semicolon; and (6)by adding at the end the following new paragraphs:

(13)discriminate against a shipper or ocean transportation intermediary for supplying their own equipment; (14)engage in an unfair or deceptive practice or an unfair method of competition in ocean transportation or the sale of ocean transportation; (15)engage in deceptive or fraudulent practices including unreasonable failure to provide transportation services as agreed to in the contract; (16)take any action that may have the effect of unreasonably and substantially lessening competition in a trade; (17)discriminate against a shipper on the basis of nationality or association with another common carrier; (18)refuse to deliver or release a shipment, if such refusal is based on debts, claims, or amounts owed that are unrelated to a debt, claim, or amount owed by that shipper; or (19)impose a surcharge that is unreasonable or does not comply with the requirements of this part.

(b)

Conforming amendments

Section 41305 is amended— (1)in subsection (c), by striking 41103(3) or (6) and inserting 41103 (4) or (7); and (2)in subsection (d), by striking 41104(4)(4)(A) and inserting 41104(5)(A).

27.

Concerted action

Section 41105 is amended— (1)in the matter preceding paragraph (1), by striking conference or; (2)in paragraph (3), by striking of a common carrier not a member of the conference, a group of common carriers and inserting of a common carrier; (3)in paragraph (4), by striking conference, joint venture, and inserting joint venture; and (4)in paragraph (6), by— (A)striking that are parties to the agreement; and (B)striking that is a party to the agreement.

28.

Monetary penalties

Section 41107(a) is amended by— (1)striking $5,000 and inserting $25,000; and (2)striking , $25,000 and inserting $75,000.

29.

Additional penalties

Section 41108 is amended— (1)in subsection (a), by striking , or that common carrier’s right to use any or all tariffs of conferences of which it is a member,; and (2)in subsection (c)(1)(A), by striking or the carrier’s right to use any or all tariffs of conferences of which it is a member.

30.

Ocean transportation practices study

(a)

Study

Within 180 days after the date of enactment of this Act, the Federal Maritime Commission shall initiate a study of ocean transportation practices, including delay of cargo, surcharges, penalties, demurrage, accessorial charges, and availability of containers for exports from the United States. In conducting the study, the Commission shall provide public notice and opportunity for comment and conduct one or more public hearings. (b)

Report to Congress

Within 180 days after completion of the study, the Commission shall provide a report on its findings to the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Transportation and Infrastructure of the House of Representatives.