[Federal Register Volume 59, Number 229 (Wednesday, November 30, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-29410]
[[Page Unknown]]
[Federal Register: November 30, 1994]
-----------------------------------------------------------------------
FEDERAL MARITIME COMMISSION
[Docket No. 94-30]
Container Pool Practices of the Trans-Atlantic Agreement and its
Members; Order of Investigation and Hearing
The Trans-Atlantic Agreement (``TAA'' or ``Agreement''), FMC
Agreement No. 202-011375, first became effective August 31, 1992,
pursuant to the Shipping Act of 1984 (``1984 Act''), 46 U.S.C. app.
1701 et seq. Sixteen ocean common carriers, identified in Appendix A
hereto, currently are members of the Agreement.\1\
---------------------------------------------------------------------------
\1\On October 24, 1994, additional modifications of the basic
agreement were permitted by the Federal Maritime Commission
(``Commission'') to take effect under the 1984 Act, among which
amendments was a change of the agreement's name to the Trans-
Atlantic Conference Agreement. While officially renamed to clarify
its designation as a conference, the carrier members continue to
refer to the Agreement as TAA.
---------------------------------------------------------------------------
By Order issued July 27, 1994, the Commission instituted Fact
Finding Investigation No. 21, entitled Activities of the Trans-Atlantic
Agreement and Its Members. Among issues to be examined in the course of
the Fact Finding Investigation were, inter alia, whether the carrier
members of the TAA had violated sections 10 (b)(1), (b)(4), and (b)(12)
of the 1984 Act.\2\ The Fact Finding Order further provides that the
designated Investigative Officers are not precluded from developing
facts related to any other possible violations of the 1984 Act that may
be uncovered in the course of the proceeding. In commencing the above
nonadjudicatory investigation, the Commission's objective was to
determine whether sufficient evidence exists to warrant formal
adjudicatory, assessment or injunctive proceedings for alleged
violations of the 1984 Act by the TAA or its carrier members.
---------------------------------------------------------------------------
\2\Section 10(b) of the 1984 Act, 46 U.S.C. app. 1709, states
that no common carrier may:
(1) charge, demand, collect, or receive greater, less, or
different compensation for the transportation of property or for any
service in connection therewith than the rates and charges that are
shown in its tariffs or service contracts;
* * * * *
(4) allow any person to obtain transportation for property at
less than the rates or charges established by the carrier in its
tariff or service contract by means of false billing, false
classification, false weighing, false measurement, or by any other
unjust or unfair device or means;
* * * * *
(12) subject any particular person, locality, or description of
traffic to an unreasonable refusal to deal or any undue or
unreasonable prejudice or disadvantage in any respect whatsoever; *
* *
---------------------------------------------------------------------------
Through responses to subpenas issued by the Investigative Officers,
testimony in fact finding hearings and through other means, it now
appears to the Commission that carrier members of the TAA have engaged
in certain practices relating to the provision of chassis and container
equipment to shippers at U.S. West Coast and interior locations other
than the carrier's designated container yard (``CY'') or terminal
facility at the port.\3\ It further appears that these practices may
have encompassed the positioning by the carrier of an inventory of
container equipment and chassis either at facilities operated by the
shippers (so-called ``shippers' pools'') or at facilities operated by
third parties such as trucking companies (``neutral container pools''
or ``equipment depots''). It is believed that the ocean common carriers
have absorbed all or a portion of the inland costs of positioning empty
equipment at these facilities on behalf of the shipper, for loading and
subsequent use in the transportation of commodities in the TAA trades.
The carriers also may have absorbed related costs of maintaining and
controlling such equipment for the benefit of certain shippers,
including benefits or concessions as to personnel, advance allocations
of equipment, and extended freetime arrangements. It does not appear
that these individual facilities or benefits are identified or held out
generally to the shipping public through the tariffs of the TAA or its
member carriers.
---------------------------------------------------------------------------
\3\Among the export commodities believed to be affected by this
practice are dried fruits and nuts, cotton and cotton linters,
agricultural commodities including vegetables and rice, and
shipments of wines and spirits. Other commodities and U.S. locations
also may be involved.
---------------------------------------------------------------------------
In addition, a review of materials furnished in response to
subpenas by the Investigative Officers indicate that, in May 1994, the
carrier members agreed in a meeting of the TAA to permit such pools to
continue in existence through August 31, 1994, despite concerns and
complaints by some members that operation of the pools was untariffed
and unlawful. It appears that the membership agreed that such pools
would be limited to those already established, and further limited to
shippers of dried fruit and nuts for the balance of the 1993-1994
shipping season. These latter allegations raise the implication that
TAA member carriers, in addition to maintaining container pools or
equipment depots on an individual carrier basis, may have participated
in a TAA decision jointly to permit some carriers to operate container
pools in violation of the 1984 Act. To the extent that TAA's action was
further limited to certain shippers of dried fruit and nuts, other
shippers of similar commodities or shippers in locations physically
proximate to these so-called container pools may have been deprived of
equivalent concessions or benefits, or subjected to undue or
unreasonable prejudice or disadvantage in respect of such container
pools.\4\
---------------------------------------------------------------------------
\4\It is unclear whether the TAA carriers individually limited
their container pool practices to shippers of specified commodities
as apparently was agreed for the period prior to August 31, 1994. It
is also unclear that the carriers terminated these alleged practices
by August 31, 1994.
---------------------------------------------------------------------------
Now therefore, it is ordered, That pursuant to sections 10, 11, and
13 of the 1984 Act, 46 U.S.C. app. 1709, 1710, and 1712, an
investigation is instituted to determine:
(1) Whether the TAA or its carrier members, jointly or severally,
violated section 10 (b)(1) or (b)(4) of the 1984 Act by charging a
lesser or different compensation for transportation or services
involving the use of container pools than the rates or charges set
forth in its tariffs or service contracts, or allowed any person to
obtain such transportation or services at less than applicable charges
by an unjust or unfair device or means with respect to such container
pools;
(2) Whether the TAA or its carrier members, jointly or severally,
violated section 10 (b)(3) or (b)(11) of the 1984 Act by extending to
any person a privilege, concession, equipment or facility involving the
use of container pools except in accordance with its tariffs or service
contracts, or made or gave any undue or unreasonable preference or
advantage to any particular person or description of traffic with
respect to such container pools;
(3) Whether the TAA or its carrier members, jointly or severally,
violated section 10 (b)(3), (b)(6) or (b)(12) of the 1984 Act by
denying to any person a privilege, concession, equipment or facility
involving the use of container pools except in accordance with its
tariffs or service contracts, engaged in any unfair or unjustly
discriminatory practice in the matter of container pool facilities, or
subjected any particular person or description of traffic to any undue
or unreasonable disadvantage or prejudice with respect to such
container pools;
(4) Whether the TAA or its carrier members, jointly or severally,
violated section 10 (b)(1), (b)(3), (b)(4), (b)(6), (b)(11), or (b)(12)
of the 1984 Act by agreeing to permit the continuation by certain
carriers of the use of container pools through the period ending August
31, 1994;
(5) Whether the TAA or its carrier members, jointly or severally,
violated section 10 (b)(1), (b)(3), (b)(4), (b)(6), (b)(11), or (b)(12)
of the 1984 Act by agreeing to permit the continuation by certain
carriers of the use of container pools through the period ending August
31, 1994, which agreement limited such privileged, concessions or
facilities to shippers of dried fruits and nuts in California;
(6) Whether, in event violations of section 10 (b)(1), (b)(3),
(b)(4), (b)(6), (b)(11) or (b)(12) of the 1984 Act are found, civil
penalties should be assessed and, if so, the amount of such penalties;
(7) Whether, in the event violations of section 10 (b)(1), (b)(3)
or (b)(4) of the 1984 Act are found, the Commission should suspend any
common carrier's rights to use any or all tariffs of the TAA and, if
so, the period of such tariff suspension; and
(8) Whether, in the event violations are found, an appropriate
cease and desist order should be issued.
It is further ordered, That a public hearing be held in this
proceeding and that this matter be assigned for hearing before an
Administrative Law Judge of the Commission's Office of Administrative
Law Judges at a date and place to be hereafter determined by the
Administrative Law Judge in compliance with Rule 61 of the Commission's
Rules of Practice and Procedure, 46 CFR 502.61. The hearing shall
include oral testimony and cross-examination in the discretion of the
Presiding Administrative Law Judge only after consideration has been
given by the parties and the Presiding Administrative Law Judge to the
use of alternative forms of dispute resolution, and upon a proper
showing that there are genuine issues of material fact that cannot be
resolved on the basis of sworn statements, affidavits, depositions, or
other documents or that the nature of the matters in issue is such that
an oral hearing and cross-examination are necessary for the development
of an adequate record;
It is further ordered, That TAA (Agreement No. 202-011375) and its
carrier members specified in Appendix A are designated respondents in
this proceeding;
It is further ordered, That the Commission's Bureau of Hearing
Counsel is designated a party to this proceeding;
It is further ordered, That notice of this Order be published in
the Federal Register, and a copy be served on parties of record;
It is further ordered, That other persons having an interest in
participating in this proceeding may file petitions for leave to
intervene in accordance with Rule 72 of the Commission's Rules of
Practice and Procedure, 46 CFR 502.72;
It is further ordered, That all further notices, orders, and/or
decisions issued by or on behalf of the Commission in this proceeding,
including notice of the time and place of hearing or prehearing
conference, shall be served on parties of record;
It is further ordered, That all documents submitted by any party of
record in this proceeding shall be directed to the Secretary, Federal
Maritime Commission, Washington, D.C. 20573, in accordance with Rule
118 of the Commission's Rules of Practice and Procedure, 46 CFR
502.118, and shall be served on parties of record;
It is further ordered, That in accordance with Rule 61 of the
Commission's Rules of Practice and Procedure, the initial decision of
the Administrative Law Judge shall be issued by August 23, 1995 and the
final decision of the Commission shall be issued by November 23, 1995.
Joseph C. Polking,
Secretary.
Appendix A
Trans-Atlantic Agreement, Meadows Office Complex, 201 Route 17
North, Rutherford, NJ 07070
Polish Ocean Lines, 1001 Durham Ave., South Plainfield, NJ 07080
Neptune Orient Lines Ltd., c/o Tricom Shipping Agency, 15 Exchange
Place, 7th Floor, Jersey City, NJ 07302
Mediterranean Shipping Company S.A., 420 5th Avenue, 8th Floor, New
York, NY 10008-2702
DSR/Senator Joint Service, 50 Cragwood Rd., South Plainfield, NJ
07080
Sea-Land Service, Inc., 150 Allen Road, Liberty Corner, NJ 07938
P&O Containers Limited, One Meadowlands Plaza-12th Fl., E.
Rutherford, NJ 07073
Hapag-Lloyd AG, 399 Hoes Lane, Piscataway, NJ 08854
Orient Overseas Container Line, 4141 Hacienda Drive, Pleasanton, CA
90731
Atlantic Container Line AB, 50 Cragwood Road, South Plainfield, NJ
07080
A.P. Moller-Maersk Line, Giralda Farms, P.O. Box 880, Madison, NJ
07940-0880
Nedlloyd Lijnen BV, c/o Nedlloyd Lines (USA) Corp., 2100 RiverEdge
Pkwy, Ste. 300, Atlanta, GA 30328-4656
Nippon Yusen Kaisha, NYK Line, 300 Lighting Way, 5th Floor,
Secaucus, NJ 07094
Transportacion Maritima, Mexicana, S.A. de C.V., c/o Trans-America
S.S. Agency, 140 W. 6th Street, San Pedro, CA 90731
Tecomar S.A. de C.V., c/o Phoenician Int'l Shipping, 2350 N. Belt
East, Suite 720, Houston, TX 77032
Cho Yang Shipping Co. Ltd., 301 Route 17 North, 6th Floor,
Rutherford, NJ 07070
Hanjin Shipping Co., Ltd., 1521 Pier C Street, Long Beach, CA 90813
[FR Doc. 94-29410 Filed 11-29-94; 8:45 am]
BILLING CODE 6730-01-M