[Federal Register Volume 59, Number 237 (Monday, December 12, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-30475]


[[Page Unknown]]

[Federal Register: December 12, 1994]


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FEDERAL MARITIME COMMISSION

46 CFR Parts 514, 552, 560, and 572

[Docket No. 94-15]

 

New Filing Fees

AGENCY: Federal Maritime Commission.

ACTION: Final rule.

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SUMMARY: The Federal Maritime Commission (``Commission'' or ``FMC'') is 
establishing filing fees for (1) tariffs, (2) service contract 
essential terms (``ETs''), (3) financial reports in the domestic 
offshore trades, (4) general rate increases in the domestic offshore 
trades, and (5) agreements. The services the Commission provides on 
these filings confer special benefits to identifiable members of the 
public.

EFFECTIVE DATE: Effective January 11, 1995, except for 46 CFR 
514.21(i), which will be effective on April 1, 1995.

FOR FURTHER INFORMATION CONTACT: Jeremiah D. Hospital or George S. 
Smolik, Bureau of Trade Monitoring and Analysis, Federal Maritime 
Commission, 800 North Capitol Street NW., Washington, D.C. 20573-0001, 
(202) 523-5790.

SUPPLEMENTARY INFORMATION:

Proceeding

    The Commission published a Notice of Proposed Rulemaking in the 
Federal Register on July 28, 1994, 59 FR 38418 (``NPR'' or ``Proposed 
Rule''),\1\ proposing to establish new filing fees. In the NPR, the 
Commission noted that the Independent Offices Appropriation Act 
(``IOAA''), 31 U.S.C. 9701, permits it to establish fees for services 
and benefits that the Commission provides to specific recipients. The 
primary guidance for implementation of IOAA is Office of Management and 
Budget (``OMB'') Circular A-25, as revised July 8, 1993. OMB Circular 
A-25 requires that a reasonable charge be made to each recipient for a 
measurable unit or amount of Federal Government service from which the 
recipient derives a benefit, in order that the Government recover the 
full cost of rendering that service. OMB Circular A-25 further provides 
that costs be determined or estimated from the best available records 
in the agency, and that cost computations shall cover the direct and 
indirect costs to the Government of carrying out the activity.
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    \1\On the same day, the Commission also published in the Federal 
Register (59 FR 38411) a companion Notice of Proposed Rulemaking in 
Docket No. 94-14, Update of Existing Filing and Service Fees.
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    The NPR advised that the Commission's existing filing and service 
fees do not include fees for certain services that appear to provide 
special benefits to identifiable members of the public. The Commission, 
accordingly, proposed to establish several new fees to reflect the full 
cost of services that provide special benefits to identifiable members 
of the public.
    Fourteen entities filed comments in response to the NPR: C V 
International, Inc.; Tampa Port Authority; Seariders International, 
Inc.; the Inter-American Discussion Agreement;\2\ Puerto Rico Maritime 
Shipping Authority (``PRMSA'');\3\ Matson Navigation Company, Inc.; The 
Joint Carrier Group (``JCG''); Hanjin Shipping Co., Ltd.; Cari-Freight 
Shipping Co. Ltd.; Caribbean Shipowners Association; Lykes Bros. 
Steamship Co., Inc. (``Lykes''); Transportation Services Incorporated; 
and the Japan Conferences.\4\ The National Industrial Transportation 
League (``NIT League'')\5\ filed late comments, which are considered 
herein.
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    \2\Conferences represented by the Inter-American Discussion 
Agreement are: the Inter-American Freight Conference; Brazil/Puerto 
Rico and U.S. Virgin Islands Conference; River Plate/Puerto Rico and 
U.S. Virgin Islands Conference; and the Inter-American Freight 
Conference-Pacific Coast Area.
    \3\See appendix A.
    \4\The Japan Conferences are: the Trans-Pacific Freight 
Conference of Japan, the Japan-Atlantic and Gulf Freight Conference, 
the Japan-Puerto Rico & Virgin Islands Freight Conference, and their 
member lines.
    \5\The NIT League is a voluntary organization said to represent 
some 1,400 shippers and groups/associations of shippers conducting 
industrial and/or commercial enterprises, large, medium, and small, 
throughout the United States and internationally.
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    The commenters represent a variety of industry interests: 
individual ocean common carriers, ocean freight conferences and other 
aligned agreement parties, ocean freight forwarders, non- vessel 
operating common carriers (``NVOCCs''), a tariff publisher, a shippers' 
group, and a port authority.

Discussion

Tariff and ET Filing Fees

    The bulk of the comments focuses on the new fees for tariff and ET 
filings. Those commenters opposed to the proposed fees for tariff and 
ET filing primarily contend that the Commission should not require 
carriers to pay for filings that are mandated by law; that facilitate 
the administering of FMC regulations; and that, they believe, benefit 
the shipping public as a whole.
    As regards the argument that tariff and ET filings are required by 
law, we would point out that the Federal Communication Commission's 
(``FCC'') imposition of fees for processing carrier tariffs has been 
upheld, Electronics Industries Ass'n v. FCC, 554 F.2d 1109, 1115 (D.C. 
Cir. 1976), as has the Interstate Commerce Commission's (``ICC'') 
imposition of fees for processing tariffs, Central & Southern Motor 
Freight Tariff Ass'n v. U.S., 777 F.2d 722, 730-36 (D.C. Cir. 1985) 
(``Central & Southern''). The courts in these cases upheld the 
agencies' assessment of tariff filing fees even though tariff filing 
was mandated by law.
    It is also argued that carriers should not pay for such filings 
because the purpose of the Commission's tariff filing program is to 
provide rate information to shippers.\6\ Carriers, however, derive 
identifiable benefits from tariff filing. The carrier benefits of 
tariff filing were explained in Central & Southern, 777 F.2d at 734, 
n.8, in which the court observed:

    \6\For example, JCG argue that the primary purpose of tariff 
filing is to ensure certainty and stability in rates that enables a 
shipper to obtain the rates that its competitors receive.
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    The tariff-filing requirement may contribute to industry 
stability in at least two ways. First, it may make secret price-
cutting impossible, since tariffs are of course public records and 
inasmuch as a motor carrier must charge the rate specified in its 
tariff. Second, the requirement may make instantaneous price cuts 
more difficult; before lowering its rates to meet or undercut the 
competition, a carrier must go to the trouble of filing its new 
proposed rates with the ICC. These statutorily provided constraints 
on competition, in turn, stabilize profits of individual carriers.
    Our conclusion that this increased industry stability warrants 
the imposition of a filing fee may appear, at first blush, 
inconsistent with the statement . . . that a fee may not be 
predicated merely upon the adoption of some practice of general 
benefit to the industry as a whole. Such is not the case, however. 
The tariff system is, in a sense, a cooperative venture, sanctioned 
by statute and supported by the ICC, in which each carrier agrees to 
publish its rates, thereby foregoing the opportunity of making 
secret, precipitous rate cuts that would be advantageous to the 
carrier in the short run. In return, all the other carriers agree to 
similar behavior, the result of which is to stabilize prices in the 
industry. As already noted, this stability is one of the chief 
purposes underlying the tariff-filing requirement. The ICC, by 
accepting a carrier's tariffs, assists that carrier in fulfilling 
its obligation to the other carriers, even as it assists the carrier 
in complying with its statutory duty. Hence, in these special 
circumstances, the ICC's tariff-filing services benefit the 
individual carrier, and not merely the industry as a whole.

While the court in Central & Southern was considering the benefits of 
the ICC's tariff filing program to surface carriers, its observations 
are applicable to ocean common carriers as well.
    In the NPR, the Commission recognized that there exist public 
benefits from tariff and ET filings, such as increased public access to 
carriers' rate and service information. In cases where, as here, fees 
have been assessed for programs conferring both public and private 
benefits, reviewing courts have concluded that there need only be a 
special private benefit to an identifiable beneficiary to justify 
assessment of a fee, regardless of ``incidental'' public benefits.\7\ 
The court in Central & Southern concluded that ``[i]f the asserted 
public benefits are the necessary consequence of the agency's provision 
of the relevant private benefits, then the public benefits are not 
independent, and the agency would therefore not need to allocate any 
costs to the public.'' Central & Southern, 777 F.2d at 732.
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    \7\See Electronic Industries Ass'n v. FCC, 554 F.2d at 1114-5; 
Centeral & Southern, 777 F.2d at 731-32.
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    A public benefit that results from nothing more than providing a 
private benefit, or is a necessary consequence of the agency's 
providing a private benefit, would be ``incidental'' to the private 
benefit. In contrast, an ``independent'' public benefit is a benefit 
that results from additional expense or effort above and beyond 
providing the private benefit. In Engine Manufacturers Association v. 
Environmental Protection Agency and Carol M. Browner, Administrator, 20 
F.3d 1177, 1180 (D.C. Cir. 1994), the court noted that ``* * * the 
public benefits associated with cleaner air are incidental to, not 
independent of, that private benefit, in the sense that they are 
produced at no cost beyond that required to produce the private 
benefit.''
    The difference between ``independent'' and ``incidental'' benefits 
has been explained in a case involving the FCC as follows:

    If the Commission, in granting an equipment type approval * * * 
is required to incur expenses for testing or inspection, such 
expenses can be charged in full to the applicant. These activities 
have undisputed private benefits although they may also create 
incidental public benefits as well. But if the agency were to engage 
in further activity to determine whether a piece of equipment which 
has already been found to have no potential for creating `harmful 
interference'. . . meets standards for consumer safety it would be 
doing so to satisfy some independent public interest, and the charge 
for these additional expenses could not be included in fees imposed 
on equipment owners. Although there may be some private benefit in 
safety testing, it is not a part of the service the agency must 
render to the manufacturer in order for him to comply with the 
statute: the additional tests service an independent public 
interest, with only incidental private benefits.

Electronic Indus. Ass'n v. FCC, 554 F.2d at 1115.
    Given the distinction drawn between ``independent'' and 
``incidental,'' the NPR invited the industry to comment on whether the 
public benefit of tariff and ET filings is ``independent'' or merely 
``incidental'' to that of tariff and ET filers, and, if 
``independent,'' to comment on what proportion of the costs to tariff-
filing and ET-filing carriers should be pro-rated to reflect any 
``independent'' benefit to the general public.
    JCG contends that the benefit to shippers from tariff and ET 
filings is ``independent'' rather than ``incidental,'' and that filers 
therefore should not be required to pay the full cost of tariff and ET 
filings. JCG refers to the Report of the Advisory Commission on 
Conferences in Ocean Shipping,\8\ which noted that the majority of 
shippers supported tariff filing provisions, and stated that the 
provisions:

    \8\The Advisory Commission on Conferences in Ocean Shipping was 
established pursuant to section 18(d) of the Shipping Act of 1984 
(``1984 Act''), 46 U.S.C. app. 1717(d), to conduct a comprehensive 
study of conferences in ocean shipping. The Advisory Commission 
issued a final report in April, 1992.
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* * * Protect the shipper by requiring that a rate filed in a tariff 
be available to all shippers of like transportation characteristics 
* * *. The notion of protecting small shippers vis-a-vis larger 
shipper * * * is also widespread. Small shippers focus on this 
particular notion of common carriage, and are concerned that larger 
shippers will get rates and/or services that they will not be able 
to get.
* * * Support for [Tariff Filing and Enforcement] also came from 
certain shippers and shippers' associations who use the filed rate 
as a benchmark when negotiating service contracts. Since part of the 
benefit to a shipper of signing a service contract is obtaining a 
discount from the prevailing tariff rate, knowing the rate in 
advance provides an effective starting point. Shippers' associations 
state that they also use the tariff rate as an indicator of the 
benefit of a collectively negotiated service contract. Shippers' 
associations say they may also use the tariff to discover the value 
of alternative service options for their members. Since tariffs 
identify both the rates and the conditions of service, the 
information is available to the association to tailor the contract 
to the varying needs of its members.

JCG Comments at 13-14, quoting The Advisory Commission on Conferences 
in Ocean Shipping Report, at 117-118 (April 1992). JCG argues further 
that since the initiation, implementation, and, to a larger extent, 
oversight and enforcement of tariff and ET filing requirements were, 
and are, done for the benefit of shippers and consignees, it must be 
concluded that such benefits are ``independent.''
    Similarly, Lykes questions whether the 29 cents of the 34 cent 
tariff filing fee covering the cost of staff review is actually for the 
benefit of the filers. Lykes argues that ATFI was initially proposed as 
being for the benefit of the shipper, and that there is an 
``independent'' rather than ``incidental'' public benefit from tariff 
and ET filings, and that fully 50 percent of the benefits of tariff and 
ET filings are for the public.
    JCG and Lykes recommend a 50 percent reduction in any fee to be 
charged to a carrier or conference, arguing that at least half of the 
benefit of the Commission's services can be attributed to shippers. JCG 
further suggests that, since Commission services also benefit the 
general public, 50 percent may be too high a percentage to charge 
filers. The Japan Conferences contend that no more than one-third of 
the Commission's tariff and ET filing processing costs should be borne 
by the carrier industry.
    These comments, urging that tariff and ET filing confer public 
benefits that are ``independent'' rather than ``incidental,'' have 
merit. In Electronics Industries, the court observed that if an agency 
engages in further activity beyond that which is required to ensure 
statutory compliance, in order to satisfy some ``independent'' public 
interest, the charges for these additional efforts could not be 
included in fees assessed to private applicants. Some elements of the 
Commission's tariff filing program go beyond those that are necessary 
to ensure compliance with statutory tariff filing requirements,\9\ and 
instead are designed to confer a benefit on the shipping public. 
Specifically, the requirement in 46 CFR 514.15(a) that carriers file 
algorithms with their tariffs facilitates shipper calculation of total 
applicable freight charges.
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    \9\Section 8 of the 1984 Act, 46 U.S.C. app. 1707; section 502 
of P.L. 102-582, 46 U.S.C. app. 1707a.
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    Similarly, the Commission incurs additional costs by carefully 
reviewing each tariff commodity description to make tariffs clearer and 
more accessible to the shipping public. This review goes beyond what is 
required by the statutory tariff filing provisions. The current 
practice of extensively reviewing commodity descriptions represents an 
additional cost and confers an independent public benefit.
    At this time, it is not possible to quantify the amount of 
Commission costs in reviewing tariff and ET filings that are 
attributable to the provision of an independent public benefit. 
Therefore, it appears that the approach urged by the commenters--that 
is, the even division of these costs between filers and the public at 
large--is the most equitable way of resolving the issue. Consequently, 
the Commission is reducing the proposed tariff and ET filing fees by 50 
percent.
    Commenters have argued that the imposition of any tariff filing fee 
is an undue burden on the ocean transportation industry. They point out 
that the proposed filing fees would be a significant additional cost to 
what they have already spent to convert their tariffs to the ATFI 
system. Commenters also submit that the tariff filing fee could prompt 
carriers to file tariff information in a more generic manner, and could 
have a chilling effect on the filing of independent actions.
    Based on the Commission's own assessment and the broad industry 
position that tariff and ET filing fees impose an undue burden on the 
industry, the Commission will seek an OMB exception for imposing these 
fees. Under OMB Circular A-25, an agency may request that OMB grant the 
agency an exception from OMB's general policy of assessing fees, 
permitting the agency to forego assessing fees if conditions exist to 
justify an exception.
    In addition to those discussed above, respondents comment on a 
number of other issues concerning tariff and ET filing fees. These are 
addressed below.
    JCG, PRMSA, and the Japan Conferences raise questions about the 
Commission's methodology in calculating the proposed fees. JCG and the 
Japan Conferences question the Commission's methodology as being less 
than thorough, and argue that the Commission was unclear in describing 
its time allocation methodology.\10\
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    \10\JCG contends that it is premature to propose user fees based 
on services provided under a system, i.e., ATFI, that is still being 
developed and the costs now being incurred are probably not an 
accurate measure of what should be allocated.
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    As explained in the NPR, the Commission employed the best available 
data to calculate the proposed filing fees, employing inhouse surveys 
to determine the time and cost involved in providing particular 
services. Extensive time and motion studies are not necessarily 
required. See Central & Southern, 777 F.2d at 736-37. OMB Circular A-25 
provides that the ``full cost [of a service] shall be determined or 
estimated from the best available records of the agency, and new cost 
accounting systems need not be established solely for this purpose 
[setting fees].'' Section 6d(1)(e). The Commission need only provide 
``some reasonable basis for its conclusions.'' Engine Manufacturers, 20 
F. 3d at 1177. The methodology employed by the Commission satisfies 
this standard.\11\
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    \11\See also National Association of Broadcasters v. Federal 
Communications Commission, 554 F.2d 1118, 1130 (D.C. Cir. 1976), 
nothing that ``[t]he ability to recoup both direct and indirect 
costs to the Government does allow for some range and latitute in 
effecting a reasonable attribution of costs.''
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    In addition to providing an extensive explanation of the 
Commission's methodology to calculate its proposed fees, the NPR also 
indicated that a detailed summary of the data used to arrive at the 
proposed fees was available to the public from the Commission. To our 
knowledge, only one commenter availed itself of this opportunity.
    In response to the comment that it is premature to implement a user 
fee for ATFI, the Commission explained in the NPR that OMB directed the 
Commission to pursue establishing a tariff filing fee in 1994. Further, 
the Commission employed the best available data to calculate the 
proposed fees. Moreover, the Commission intends to periodically update 
tariff filing fees, adjusting for changes in costs as warranted.
    The Japan Conferences question the Commission's calculations of 
indirect costs assignable to fee-related services. They further 
question why the Commission included the proportional costs of several 
FMC bureaus and offices\12\ that are only peripherally involved with 
tariff filing, suggesting that such expenses be reduced by at least 50 
percent.\13\
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    \12\Office of the Commissioners, General Counsel, Bureau of 
Administration, and Bureau of Trade Monitoring and Analysis.
    \13\The Japan Conferences urge that the proportional cost of the 
Office of the Secretary be entirely deducted from the indirect cost 
calculation.
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    As explained in the NPR, the FMC generally adopted the ICC's 
methodology for determining indirect costs because the ICC's fee 
schedule and methodologies have been reviewed by the courts and 
generally deemed acceptable.\14\ See Central & Southern, 777 F.2d at 
722. Although we developed an indirect cost methodology based on the 
ICC's experience, we nevertheless deducted a number of expenses to 
calculate the FMC's indirect costs. For example, the ICC employs an 
indirect cost item for operations overhead, which apportions senior 
executive time across fee-generating activities. Because we were able 
to account for senior executive time in each service item, a separate 
overhead item would be redundant. Accordingly, this ICC component was 
not included in the FMC's calculations. Additionally, in calculating 
our indirect costs, we deducted certain expenses that have no nexus 
with any fee activity from the office general and administrative 
component of the indirect cost calculation (e.g., buying Census data).
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    \14\The Japan Conference also point out that the Commission's 
indirect costs, calculated at 99.5 percent of direct costs, is more 
than 50 percent higher than the ICC's indirect costs reviewed in 
Central & Southern, supra 777 F.2d at 726-27. However, the Japan 
Conferences fail to take into account that the ICC's indirect costs 
cited in Central & Southern were calculated almost ten years ago, 
and that the ICC's current indirect cost factor is 100.8 percent, 
slightly higher than that of the FMC.
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    In light of appeals court precedent supporting the methodology 
employed in calculating the FMC's indirect costs, and because of the 
attention given to include only those expenses that are relevant to our 
indirect cost calculations, the Japan Conferences' arguments are 
rejected.
    JCG also states that a tariff filing fee may act as a disincentive 
to taking independent action by conference members, and further, that 
it could lead carriers and conferences to delay tariff filing at the 
expense of clarity. The Japan Conferences recommend that the Commission 
calculate a flat per-tariff or per-carrier/conference fee that would 
not have, they contend, a disabling effect on the independent action 
process or commodity-based tariffs. Similarly, JCG urges the Commission 
to consider establishing a fixed annual fee for each tariff filed to 
avoid repeat billings and collections and to reduce both Commission and 
conference/carrier administrative time and costs. JCG contends that a 
flat fee would also create a certainty for filers from the standpoint 
of knowing the annual fees that will be paid for tariff filing 
activities.
    Administrative costs may decline if the Commission implements a 
flat annual fee for tariff filing. A flat annual fee for tariff filing, 
therefore, has some appeal. Further study would be required, however, 
to determine the level of a cost-based fee. Also, adoption of a flat 
fee is beyond the scope of this rulemaking.
    Lykes argues that the Commission should reserve a certain 
percentage of any user fees assessed for system enhancement in the 
future, thereby addressing a certain lack of flexibility in the current 
system. According to Lykes, these enhanced capabilities should include 
simultaneous multiple tariff access, better definition and capabilities 
for inland table construction and utilization, and inclusion of 
transport mode in through single factor rate filings. Whatever its 
merit otherwise, Lykes' suggestion is irreconcilable with the IOAA and 
OMB Circular A-25, which instruct that user fee collections not be used 
to offset costs of activities that are not related to the specific 
service the Commission is performing for an identifiable recipient.
    The Japan Conferences comment that ATFI contractor costs should be 
pro-rated between filing and retrieval expenses, otherwise the 
Commission will be charging twice for the same service. As explained in 
the NPR, only that portion of the ATFI system cost allocated to filers 
was included in the proposed filing fee. Because there is no double 
billing of contractor costs, the Japan Conferences' concerns are 
unfounded.
    Hanjin Shipping Co., Ltd. (``Hanjin'') contends that the proposed 
fees constitute a tax on international trade because such fees fail to 
consider international comity, that is, other countries do not require 
such filings and fees. Hanjin argues that the Commission should not 
impose burdensome fees in the United States, where no such fees are 
assessed by foreign governments on carriers operating there. Contrary 
to Hanjin's assertions, the proposed tariff filing fee is not a tax. 
The fee is designed to recover the full cost to the Commission of 
performing a service that provides tariff filers with a special 
benefit, as mandated by OMB Circular A-25. In Federal Power Commission 
v. New England Power Co., 415 U.S. 345, 351 (1974), the Court held that 
the assessment of specific charges to specific individuals or companies 
was ``within the boundaries of the `fee' system and away from the 
domain of `taxes'.''
    The Tampa Port Authority urges that public entities, like itself, 
be exempted from tariff filing fees because they are exempted from the 
Commission's subscription fees. Exempting port authorities from paying 
subscription fees is a courtesy provided by the Commission, since port 
authorities typically request Commission issuances for informational 
purposes. However, tariff filing provides a specific benefit to members 
of the shipping public, including port authorities, similar to that 
gained by private entities. No distinction would appear to exist 
between the status of public and private tariff filers to justify the 
exemption of port authorities from filing fees.
    To address other matters raised concerning tariff and ET filings, 
the Commission clarifies that: (1) The tariff and ET filing fee will 
apply even if the filing or ET is subsequently rejected; (2) billing 
for ETs will be based on a set of terms for an individual service 
contract rather than on each term in the set, e.g., a filer of a 
service contract who files a set of ten essential terms for that 
contract will be billed a total of $1.65, not $16.50; (3) billing for 
tariff filing will be done according to a filer's logon identification 
number; and (4) to the extent possible, the Commission intends to bill 
filers on a monthly basis.

Agreement Filing Fees

    Several commenters contend that they should not be required to pay 
the full cost of agreement filing because of the broad public benefit 
associated with such filings, but do not elaborate on the nature and 
extent of this public benefit. They also state that the proposed 
agreement filing fees will discourage regular compliance and encourage 
withholding important changes until such time as several changes can be 
filed in a single amendment.
    As stated in the NPR, the processing of agreements benefits the 
filing parties because of the concomitant antitrust immunity conferred 
by the Shipping Act, 1916, 46 U.S.C. app. Sec. 801 et seq., and the 
Shipping Act of 1984, 46 U.S.C. app. Sec. 1701 et seq. Agreements 
enable joint ratemaking or cost-cutting measures to accrue to the 
benefit of the signatory parties. The sales revenues or cost savings, 
or both, can add up to millions of dollars for one carrier, let alone 
several carriers. While carrier savings may eventually benefit the 
public, that benefit is incidental to the private benefits enjoyed by 
the parties to agreements filed under the Shipping Acts. Concerns that 
the proposed filing fee will have a dampening effect on filing 
agreements, or amendments thereto, are speculative at best and do not 
weigh against imposing the proposed filing fee.

General Rate Increase Filing Fee

    Several commenters oppose the proposed filing fee for general rate 
increases (``GRIs'') in the domestic offshore trade, contending that 
such filings are for the public benefit, and that the full cost of such 
review should not be borne by the carrier.\15\ However, the proposed 
filing fee is based on the full cost to the Commission of processing 
GRI filings, and not on the broader incidental benefits associated with 
a regulated domestic offshore trade.\16\ Further, Commission review of 
GRIs benefits filers, in that it ensures that they comply with 
statutory requirements of the Intercoastal Shipping Act, 1933, 46 
U.S.C. app. section 843 et. seq., i.e., that filed rates be just and 
reasonable.
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    \15\PRMSA comments that the filing of GRIs is part of the 
regulatory regimen established for the benefit of the public--to 
ensure that the shipping public is treated fairly and without 
discrimination.
    \16\The NPR explained how filers of GRIs in the domestic 
offshore trades specifically benefit because of the potential for 
increased revenues.
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    The Commission believes that carriers operating in the domestic 
offshore trades receive a clear and definite benefit from GRIs, and 
that any public benefit flowing from Commission review of such filings 
is ``incidental'' to the benefits accruing to the filers. The benefits 
to carriers include their potential for increased revenues, and 
assistance in meeting their statutory duty to charge ``just and 
reasonable'' rates. Therefore, reduction of the GRI filing fee to 
account for public benefit is not warranted.
    Matson Navigation Company, Inc. (``Matson'') regards the imposition 
of a new filing fee at this time as untimely. It points out that the 
Commission is considering revisions of its methodology for determining 
the reasonableness of a carrier's GRIs.\17\ Matson states that the new 
GRI fee is based on historic cost data and that there is no indication 
in the NPR that the Commission has yet made an analysis of what the 
costs will be under the proposed revised methodology. The Commission is 
therefore urged to defer implementation of its GRI filing fee proposal 
until it has developed sufficient cost experience under the new 
methodology to justify imposition of such a fee.
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    \17\See Docket No. 94-07, Financial Reporting Requirements and 
Rate-Of-Return Methodology in the Domestic Offshore Trades, 59 FR 67 
(April 7, 1994).
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    Matson's concerns themselves appear untimely, as any new GRI 
methodology is some time away. If and when the Commission changes 
methodologies, the cost of processing GRIs under the new method will be 
studied and adjustment made accordingly. For now, the Commission still 
employs the current method for determining the reasonableness of GRIs, 
and the proposed fee reflects the current cost to the Commission of 
analyzing GRIs.
    PRMSA comments that including the agency's general and 
administrative costs and other indirect costs (many of which PRMSA sees 
as not pertaining to the cost of processing a GRI) is unreasonable and 
improper. It argues that carriers should not be required to pay 
Government overhead, which includes matters such as travel, furniture 
and other expenses of the Commission, and which have little bearing on 
the processing of those documents. At a maximum, PRMSA urges that the 
industry should pay only those costs that are directly related to GRI 
review.
    As explained in the NPR, the Commission employed the best available 
data to calculate the proposed filing fees, employing surveys to 
determine the time and cost involved in providing particular services. 
The courts have leaned toward reasonableness in attributing costs, not 
necessarily exactitude.\18\ Furthermore, the Commission's method for 
allocating indirect costs follows what has been generally accepted in 
Central & Southern. Finally, the Commission deducted certain expenses 
from its indirect cost calculations so that only relevant expenses 
remained in calculating the proposed fees.
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    \18\See Engine Manufacturers Association, 20 F.3d at 1177.
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    PRMSA claims that the Commission's proposal to cover the full cost 
of GRI filings is arbitrary because recouping the full cost does not 
extend to other types of filings such as formal complaints, petitions, 
and informal complaints, none of which include the Administrative Law 
Judges' or Hearing Counsel's time.
    The Commission's method for the assessment of user fees for GRI 
filings is similar to the approach used for other Commission 
activities. The proposed fees for filing formal complaints, petitions, 
and informal complaints do not include any cost for adjudicatory 
functions that they may require.\19\ Similarly, the proposed fees for 
GRI and agreement filings do not include any cost for adjudicatory 
functions. The filing fee for GRIs only covers the analytical staff 
work in reviewing GRIs.
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    \19\As the Commission explained in the NPR, enforcement 
activities are not deemed appropriate for assessing fees because 
they are adjudicatory functions that have broad public significance 
and a quasi-judicial impact.
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    Finally, PRMSA contends that the Commission's GRI fee of $11,951 is 
inconsistent with the fees charged by other agencies. PRMSA cites the 
ICC, which charges a fee of $7,700 to process requests for nationwide 
and regional collectively filed GRIs under 49 CFR 1002.2(f). FMC review 
of GRI filings in the domestic offshore trade is distinct in both 
purpose and resource requirements from the ICC's processing of GRIs. 
Further, while the FMC adopted the approach used by the ICC in 
developing a methodology for determining indirect costs, we recognized 
the need to develop our own fees due to differing cost structures 
between the two agencies.
    The proposed fees concerning applications filed by carriers in the 
domestic offshore trades, requesting permission to deviate from annual 
reporting requirements, did not elicit any comment and are adopted as 
final.
    Based on the foregoing, the Commission is adopting as final the 
proposed new fees, as amended herein. Because the Commission finds that 
there is an ``independent'' public benefit associated with tariff and 
ET filings, the Commission is reducing by half the tariff filing fee to 
$.17 per filing object, and the ET filing fee to $1.65 per set. See 
Appendix B for a summary of the new fees established in this 
proceeding.
    To permit sufficient time to develop, test, and implement billing 
procedures for collecting tariff and ET filing fees, the Commission is 
delaying the effective date for those fees to April 1, 1995.
    In keeping with OMB guidelines, the Commission intends to update 
its fees on an annual basis. In updating its fees, the Commission will 
incorporate changes in the wages and salaries of its employees into 
direct labor costs associated with its services, and recalculate its 
indirect costs (overhead) based on current costs.
    In the NPR, the Commission certified, pursuant to section 605(b) of 
the Regulatory Flexibility Act, 5 U.S.C. 605(b), that the Proposed Rule 
would not have a significant economic impact on a substantial number of 
small entities, including small businesses, small organizational units, 
and small governmental jurisdictions. The Commission did recognize, 
however, that the proposed new fees may have an impact on the shipping 
industry, but not of the magnitude that would be contrary to the 
requirements of the Regulatory Flexibility Act.
    As mentioned earlier, commenters argue that the proposed tariff and 
ET filing fees would significantly increase their cost of doing 
business, and that this additional cost coupled with what they have 
already spent to convert their paper tariffs to the ATFI system 
represents an undue burden on the industry.
    Under the Regulatory Flexibility Act, agencies may examine 
alternatives to minimize the economic burden of proposed rules on an 
industry. Given the obligation to assess fees imposed on the FMC by the 
IOAA and OMB Circular A-25, the Commission finds that there are no 
viable alternatives, and that the proposed tariff and ET filing fees, 
as amended herein, are the least burdensome choice for the Commission.
    Although there is no apparent alternative that would minimize the 
economic burden of tariff and ET filing fees on the industry and 
achieve the Commission's regulatory objective, the Commission is 
pursuing, nevertheless, an OMB exception, which would permit the 
Commission to forego collecting these fees. If the Commission receives 
a favorable response, the Commission will remove these fees from its 
rules.
    This final rule does not contain any collection of information 
requirements as defined by the Paperwork Reduction Act of 1980, as 
amended. Therefore, OMB review is not required.

List of Subjects

46 CFR Part 514

    Freight, Harbors, Maritime carriers, and Reporting and 
recordkeeping requirements.

46 CFR Part 552

    Maritime carriers, Reporting and recordkeeping requirements, and 
Uniform System of Accounts.

46 CFR Part 560

    Administrative practice and procedure, Antitrust, Freight, Maritime 
carriers, Penalties, and Reporting and recordkeeping requirements.

46 CFR Part 572

    Administrative practice and procedure, Maritime carriers, and 
Reporting and recordkeeping requirements.

    Pursuant to 5 U.S.C. 553, the Independent Offices Appropriations 
Act, 31 U.S.C. 9701, and section 17 of the Shipping Act of 1984, 46 
U.S.C. app. 1716, the Commission amends title 46 of the Code of Federal 
Regulations as follows:

PART 514--TARIFFS AND SERVICE CONTRACTS

    1. The authority citation for Part 514 continues to read as 
follows:

    Authority: 5 U.S.C. 552 and 553; 31 U.S.C. 9701; 46 U.S.C. app. 
804, 812, 814-817(a), 820, 833a, 841a, 843, 844, 845, 845a, 845b, 
847, 1702-1712, 1714-1716, 1718, 1721 and 1722; and sec. 2(b) of 
Pub. L. 101-92, 103 Stat. 601.
* * * * *
    2. In Sec. 514.1, the heading is revised and a new paragraph (f) is 
added to read as follows:
* * * * *


Sec. 514.1   Scope, purpose, requirements, penalties and fees.

* * * * *
    (f) Filing fee. Under the authority of the Independent Offices 
Appropriation Act, 31 U.S.C. 9701, the Commission assesses a filing fee 
for ATFI filings. See Sec. 514.21(i) for filing fees.
    3. In Sec. 514.21, paragraph (i) is added to read as follows:


Sec. 514.21   User charges.

* * * * *
    (i) Tariff filing fee. The fee for tariff filing in either the 
foreign or domestic offshore commerce of the United States shall be 17 
cents per filing object; the fee for filing service contract essential 
terms shall be $1.65 per filing set.

PART 552--FINANCIAL REPORTS OF VESSEL OPERATING COMMON CARRIERS BY 
WATER IN THE DOMESTIC OFFSHORE TRADES

    4. The authority citation for Part 552 is revised to read as 
follows:

    Authority: 5 U.S.C. 553; 31 U.S.C. 9701; 46 U.S.C. app. 817(a), 
820, 841a, 843, 844, 845, 845a, and 847.

    5. In Sec. 552.2, the heading is revised, and new paragraphs 
(c)(3), (d)(3), and (f)(3) are added and a sentence is added at the end 
of the paragraph (e) to read as follows:
* * * * *


Sec. 552.2   General requirements and fees.

* * * * *
    (c) * * *
    (3) Applications shall be accompanied by remittance of a $55 filing 
fee.
    (d) * * *
    (3) Applications shall be accompanied by remittance of a $165 
filing fee.
    (e) * * * Applications shall be accompanied by remittance of a $103 
filing fee.
    (f) * * *
    (3) The filing of proposed rate changes described in this paragraph 
shall be accompanied by remittance of a $11,951 filing fee.
* * * * *

PART 560--AGREEMENTS BY COMMON CARRIERS AND OTHER PERSONS SUBJECT 
TO THE SHIPPING ACT, 1916

    6. The authority citation for Part 560 is revised to read as 
follows:

    Authority: 5 U.S.C. 553; 31 U.S.C. 9701; 46 U.S.C. app. 814, 
817(a), 820, 821, 833a and 841a.

Subpart C--Exemptions

* * * * *
    7. The following identical text is added as Secs. 560.302(c), 
560.303(c), 560.304(c), 560.305(c), 560.306(f), 560.307(g), 560.308(c), 
and 560.309(d), reading as follows:
* * * * *
    (  ) The filing fee for such agreements is described in section 
560.401(c).
* * * * *

Subpart D--Filing and Form of Agreements

* * * * *
    8. In Sec. 560.401, the heading is revised and a new paragraph (c) 
is added to read as follows:
* * * * *


Sec. 560.401   Filing of Agreements; fees.

* * * * *
    (c) Agreement filings for Commission action requiring detailed 
justification and review by the Commission shall be accompanied by 
remittance of a $1,402 filing fee; agreement filings for Commission 
action not requiring detailed justification, but requiring review by 
the Commission, shall be accompanied by remittance of a $695 filing 
fee; and, agreement filings for terminal and carrier exempt agreements 
shall be accompanied by remittance of a $120 filing fee.

PART 572--AGREEMENTS BY COMMON CARRIERS AND OTHER PERSONS SUBJECT 
TO THE SHIPPING ACT OF 1984

    9. The authority citation for Part 572 is revised to read as 
follows:

    Authority: 5 U.S.C. 553; 31 U.S.C. 9701; 46 U.S.C. app. 1701-
1707, 1709-1710, 1712 and 1714-1717.

Subpart C--Exemptions

    10. The following identical text is added as Secs. 572.302(d), 
572.303(c), 572.304(c), 572.305(c), 572.306(f), 572.307(g), 572.308(e), 
572.309(c), 572.310(c), and 572.311(d) reading as follows:
* * * * *
    (  ) The filing fee for such agreements is described in 
Sec. 572.401(f).
* * * * *
    11. In Sec. 572.401, the reading is revised, and a new paragraph 
(f) is added to read as follows:
* * * * *


Sec. 572.401   Filing of agreements; filing fees.

* * * * *
    (f) Agreement filings for Commission action requiring an 
Information Form and review by the Commission shall be accompanied by 
remittance of a $1,402 filing fee; agreement filings for Commission 
action not requiring an Information Form, but requiring review by the 
Commission, shall be accompanied by remittance of a $695 filing fee; 
agreement filings reviewed under delegated authority shall be 
accompanied by remittance of a $353 filing fee; and agreement filings 
for terminal and carrier exempt agreements shall be accompanied by 
remittance of a $120 filing fee.

    By the Commission.
Joseph C. Polking,
Secretary.

    Note: The following appendices will not appear in the Code of 
Federal Regulations.

Appendix A

Conferences and Discussion Agreements and the ATFI Working Group 
Represented by the Joint Carrier Group

Asia North American Eastbound Rate Agreement
Colombia Discussion Agreement
Hispaniola Discussion Agreement
Inter-American Discussion Agreement
Inter-American Freight Conference
Inter-American Freight Conference Pacific Coast Area
Inter-American Freight Conference Puerto Rico and U.S. Virgin 
Islands
Inter-American Freight Conference River Plate/Puerto Rico and U.S. 
Virgin Islands/River Plate
Israel Trade Conference
Jamaica Discussion Agreement
Latin American Shipping Services Agreement
Mediterranean/North Pacific Freight Conference
Mediterranean/Puerto Rico Conference
Pacific Coast/Australia-New Zealand Tariff Bureau
PANAM Discussion Agreement
Southeastern Caribbean Discussion Agreement
South Europe American Conference
The 8900 Lines Agreement
Transpacific Westbound Rate Agreement
U.S. Atlantic & Gulf/Australia-New Zealand Conference
U.S. Atlantic & Gulf Hispaniola Freight Association
U.S. Atlantic & Gulf Port/Eastern Mediterranean North Africa Freight 
Conference
U.S. Atlantic & Gulf/Southeastern Caribbean Freight Agreement
U.S./Panama Freight Association
Venezuelan American Maritime Association
West Coast of South America Agreement
West Coast of South America Discussion Agreement
Westbound Transpacific Stabilization Agreement

ATFI Working Group

American West African Freight Conference
Caribbean and Central America Discussion Agreement
The 8900 Lines Agreement
Inter-American Discussion Agreement
Inter-American Freight Conference
Israel Trade Conference
South Europe American Conference
Trans-Atlantic Agreement
Transpacific Westbound Rate Agreement
U.S. Atlantic & Gulf/Australia-New Zealand Conference

Appendix B

Federal Maritime Commission, Summary of New Fees

------------------------------------------------------------------------
 CFR citation            Application or service              New fee    
------------------------------------------------------------------------
                 Part 514--Tariffs and Service Contracts                
                                                                        
------------------------------------------------------------------------
514.21(i)       Tariff filing..........................  17 cents per   
                                                          filing object.
                Filing a set of service contract         $1.65 per      
                 essential terms.                         filing set.   
                                                                        
------------------------------------------------------------------------
Part 552--Financial Reports of Vessel Operating Common Carriers by Water
                     in the Domestic Offshore Trades                    
------------------------------------------------------------------------
552.2(f)        General Rate Increase..................  $11,951        
552.2(c)        Application for Extension of Time for    55             
                 Filing.                                                
552.2(d)        Application for Submission of            165            
                 Alternative Data.                                      
552.2(e)        Application for Waiver of Detailed       103            
                 Reporting Requirements.                                
                                                                        
------------------------------------------------------------------------
Part 560--Agreements by Common Carriers and Other Persons Subject to the
                           Shipping Act, 1916                           
------------------------------------------------------------------------
560.401(c)      Agreement Filings Requiring Detailed     1,402          
                 Justification and Commission Action.                   
                Agreement Filings not Requiring          695            
                 Detailed Justification but Requiring                   
                 Commission Action.                                     
                Agreement Filing for Terminal and        120            
                 Carrier Exempt Agreements.                             
                                                                        
------------------------------------------------------------------------
Part 572--Agreements by Common Carriers and Other Persons Subject to the
                          Shipping Act of 1984                          
------------------------------------------------------------------------
572.401(f)      Agreement Filings Requiring Information  1,402          
                 Form and Commission Action.                            
                Agreement Filings not Requiring          695            
                 Information Form but Requiring                         
                 Commission Action.                                     
                Agreement Filing Reviewed Under          353            
                 Delegated Authority.                                   
                Agreement Filing for Terminal and        120            
                 Carrier Exempt Agreements.                             
------------------------------------------------------------------------


[FR Doc. 94-30475 Filed 12-9-94; 8:45 am]
BILLING CODE 6730-01-W