[Federal Register Volume 64, Number 31 (Wednesday, February 17, 1999)]
[Rules and Regulations]
[Pages 7804-7813]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-3621]


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FEDERAL MARITIME COMMISSION

46 CFR Parts 502, 545 and 571

[Docket No. 98-21]


Miscellaneous Amendments to Rules of Practice and Procedure

AGENCY: Federal Maritime Commission.

ACTION: Final rule.

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SUMMARY: The Federal Maritime Commission is making corrections and 
changes to existing regulations to update and improve them, and to 
conform them to and implement the Ocean Shipping Reform Act of 1998. 
This rule modifies part 502 (Rules of Practice and Procedure) and 
redesignates part 571 as part 545 (Interpretations and Statements of 
Policy).

DATES: Effective May 1, 1999.

FOR FURTHER INFORMATION CONTACT: Bryant L. VanBrakle, Secretary, 
Federal Maritime Commission, 800 North Capitol St., NW., Room 1046, 
Washington, DC 20573-0001, (202) 523-5725, E-mail: [email protected].

SUPPLEMENTARY INFORMATION:
    The Ocean Shipping Reform Act of 1998 (``OSRA''), Pub. L. 105-258, 
112 Stat. 1902, which made numerous changes to the Shipping Act of 1984 
(``1984 Act''), Pub. L. 98-237, 98 Stat. 67 (46 U.S.C. app. secs. 1701 
through

[[Page 7805]]

1720), was enacted on October 14, 1998, and becomes effective on May 1, 
1999. Among other things, OSRA authorizes the Commission to prescribe 
implementing rules and regulations. Accordingly, the Federal Maritime 
Commission published a notice of proposed rulemaking on December 2, 
1998, 63 FR 66512, to redesignate part 571 as part 545 and amend parts 
502 and 545 of the Commission's rules.
    The Commission received comments in response to the proposed rule 
from the National Industrial Transportation Leagues (``NIT League''), 
the Council of European and Japanese National Shipowners'' Associations 
(``CENSA''), the Maritime Administrative Bar Association (``MABA''), 
Fruit Shippers Ltd., and jointly from American President Lines, Ltd. 
and APL Co. Pte Ltd (``APL'').
    CENSA and NIT League both commented on proposed Sec. 502.67, which 
implements the exemption provision in section 16 of the 1984 Act. 
Section 16 provides:

    ``(t)he Commission, upon application or on its own motion, may 
by order or rule exempt for the future any class of agreements 
between persons subject to this Act or any specified activity of 
those persons from any requirement of this Act * * *.''

CENSA objects to the proposed rule because it perceives that by moving 
Sec. 502.67 from part 572 to part 502, the Commission has made 
exemptions generally available to matters other than agreements. CENSA 
claims this goes beyond the Commission's exemption power. It is true 
that the Commission's rules have heretofore addressed exemption 
procedures only within the agreement provisions currently within part 
572. However, section 16 has always authorized the Commission to exempt 
persons subject to the 1984 Act from any of its requirements, and the 
Commission has indeed granted isolated exemptions from such matters as 
tariff filing requirements, when the statutory standards were met. OSRA 
did not preclude the application of section 16 to any provision or 
requirement of the 1984 Act. OSRA simply changed the standards that 
must be met in order to grant an exemption. The new standard requires 
that a proposed exemption not result in substantial reduction in 
competition or be detrimental to commerce. The proposed rule located 
the procedure for requesting an exemption in Sec. 502.67, and that 
procedure is applicable to all exemption requests, consistent with our 
statutory authority, not only agreement exemption requests.
    NIT League also objects to proposed Sec. 502.67. NIT League points 
out that the use of the word ``may'' in the first sentence of proposed 
Sec. 502.67 could be read to mean that the Commission may decide not to 
grant an exemption even if a requested exemption meets the standards of 
section 16 of the 1984 Act. NIT League proposes language requiring that 
the Commission grant an exemption whenever it finds the standards have 
been met. NIT League proposes to change the word ``may'' to ``shall,'' 
so that the rule would read, ``The Commission * * * shall * * * exempt 
* * *.'' However, section 16 does not mandate that the Commission grant 
exemptions. It specifically contains the word ``may'' and not the word 
``shall,'' thus making clear that the decision whether to grant an 
exemption is discretionary. The proposed rule mirrors the 1984 Act, as 
amended by OSRA, in this respect. Hence, NIT League's assertion that 
the Commission must grant an exemption when it finds a requested 
exemption will not result in substantial reduction in competition or be 
detrimental to commerce is not consistent with section 16, and the 
Commission therefore declines to modify proposed Sec. 502.67.
    MABA commented extensively on the proposed rules concerning service 
of process, length of briefs, incorporation of the Model Rules of 
Professional Conduct, the length and cost of proceedings, and the use 
of promissory notes in payment of penalties. MABA strongly objects to 
changes proposed to Sec. 502.113 which would allow for a complainant to 
effect service when the Secretary is not successful in obtaining 
service by mail. MABA claims that the proposed amendment shifts the 
burden of service from the Commission to private litigants. However, 
the proposed modification would merely allow for service by the 
complainant as a viable option. Historically, the Secretary serves 
complaints by mail, and will continue to do so. Currently, the 
Commission's complaint filing rules require the complaint to specify 
the name and address of each respondent. It is necessary for the 
complainant to provide the address for each respondent so that the 
complaint may be served by mail. Sometimes, however, a respondent 
cannot be located at the provided address and the complaint ends up 
being returned. At such times, the Secretary works with the complainant 
to attempt to locate the respondent, so that service may be obtained. 
Although this practice will continue, the proposed amendment will allow 
for the possibility of service by the complainant. The Secretary has 
not made a practice of effecting personal service and is in no better 
position to do so than any complainant. Contrary to MABA's assertions, 
the Commission no longer has field offices, and the five area 
representatives around the country are not available for the purpose of 
serving complaints.
    MABA also asserts that the Commission might use its Regulated 
Persons Index (RPI) to facilitate personal service. However, parties 
regulated by the Commission and listed in the RPI are rarely 
unavailable for mail service. The difficulty in serving by mail arises 
when the respondent is not regulated by the Commission, or has 
relocated its business without informing the Commission, thus rendering 
the RPI ineffective in locating a respondent. The language of the final 
rule is slightly modified, however, in an attempt to clear up 
confusion.
    Proposed Secs. 502.221 and 502.227 would limit briefs to an 
Administrative Law Judge and to the Commission on exceptions to fifty 
(50) pages in length, unless, for good cause shown, the presiding 
officer grants a request to exceed the limit. In its comments, MABA 
objects to these limits.
    With respect to Sec. 502.221, MABA suggests that it is unrealistic 
to expect an evidentiary record before an Administrative Law Judge to 
be encapsulated in a useful way within fifty pages that adequately 
develops legal issues, especially in a proceeding where the case will 
be developed on a written record without actual ``hearing.'' MABA also 
cites research indicating that other agencies do not impose page 
limitations on briefs before the presiding officer following an 
evidentiary hearing.
    The evidentiary record in proceedings generally is not developed on 
the basis of briefs. Evidence is admitted in the form of written or 
oral testimony, with transcripts of oral testimony available, and the 
admission of documentary evidence. The Commission believes that, in 
most cases, lengthy briefs are not required to fully discuss the 
issues. It is not necessary to include within briefs evidence already 
admitted. However, the proposed rule allows the presiding officer to 
permit longer briefs where warranted. In light of MABA's concerns, 
however, the final rule expands the page limit for such briefs to 
eighty (80) pages. The Commission believes this measure will encourage 
efficiency and focus in proceedings which have become increasingly time 
consuming and costly.
    With respect to Sec. 502.227, MABA believes a page limitation on 
briefs to the Commission, is a ``closer question,'' and cites four 
other agencies who do

[[Page 7806]]

impose such limitations. They are the National Labor Relations Board, 
Occupational Safety and Health Administration, Securities and Exchange 
Commission, and Surface Transportation Board. As MABA points out, the 
Commission is not limited to identified issues of error, as a court of 
appeals would be, when reviewing a matter on exceptions. MABA 
recognizes that the Commission is, indeed, the ultimate fact finder in 
such instances. In reality, however, when reviewing such matters the 
Commission has the developed record before it, including briefs 
previously filed with the presiding Administrative Law Judge. We 
believe it is unnecessary to retrace an entire proceeding in a brief on 
exceptions. Rather, such briefs should focus on the exceptions to the 
initial decision. Therefore, in the interest of efficiency and lower 
costs of proceedings, the final rule maintains the proposed fifty (50) 
page limitation on briefs on exceptions. It should be noted, however, 
that the rule provides that parties may request to be allowed to exceed 
the limitation for good cause, upon timely application.
    MABA strongly supports the proposed incorporation of the American 
Bar Association's Model Rules of Professional Conduct into Sec. 502.26, 
but requests that the Commission establish a procedure to handle 
complaints arising under Secs. 502.26 and 502.30, the latter of which 
provides sanctions. As MABA points out, the presiding administrative 
law judge has dealt with ethical complaints when they arise in the 
course of a proceeding. MABA believes this may be appropriate in some 
circumstances, but awkward for the presiding officer and prejudicial to 
an attorney's client in other circumstances. MABA avers that the 
procedure can also deter a party from making a legitimate ethical 
complaint to an administrative law judge. MABA seeks a separate and 
impartial procedure to hear ethical complaints. Currently, no party is 
barred from bringing violations to the attention of the Commission. As 
MABA recognizes, certain questions are appropriate for resolution in 
the course of a proceeding by the presiding officer. Should there be a 
complaint, however, that the complaining party believes should be 
handled separately and independently from a proceeding, a filing, 
whether by petition or other written document, should be submitted to 
the Commission's Secretary, just as any other filing would be. The 
Secretary, in consultation with appropriate Commission officials, will 
arrange for consideration of the complaint within the Commission.
    MABA also requests clarification that Sec. 502.26 applies to both 
private attorneys and Commission attorneys. Neither the current or 
proposed Sec. 502.26 differentiates between a Commission and private 
attorney, and no clarification in the rule appears warranted.
    In a more general comment, MABA encourages the Commission ``to 
consider ways of reducing the length and cost of its proceedings,'' 
citing increasingly costly and time consuming proceedings. MABA 
suggests that Administrative Law Judges be given greater power to 
prevent unnecessary delay and expense. In addition, MABA recommends the 
Commission consider forming a public-private task force or advisory 
committee to recommend steps to reduce the length and cost of 
Commission proceedings. The Commission recognizes MABA's concerns, but 
does not believe an advisory committee, itself a costly undertaking, is 
warranted at the present time. The Administrative Law Judges currently 
possess authority to manage proceedings efficiently. As MABA 
recognizes, the Commission has procedural rules requiring expedited 
discovery, and the increasing complexity of proceedings, budget 
cutbacks and due process concerns all affect the length and cost of 
proceedings. Litigants' attorneys, however, play a major role in 
assuring that deadlines in proceedings are met and costs to their 
clients are kept down. Ultimately, the cooperation among parties and 
their counsel in discovery, a commitment to meet deadlines without 
requesting additional time, and minimizing the length and number of 
motions and other filings can have more impact on reducing costs than 
any rule changes that may be imposed by the Commission. However, it is 
believed that the page limitation on briefs and other changes made in 
these final rules will help reduce the expense of Commission 
proceedings.
    Finally, MABA objects to the removal of the provision allowing for 
payment of penalties by promissory note, suggesting that the Commission 
continue to allow such payment where appropriate. Proposed Sec. 502.605 
would still allow the Commission to accept payment by ``other 
instrument acceptable to the Commission,'' which could include a 
promissory note where appropriate. Generally speaking, however, it is 
not the Commission's policy or preference to accept promissory notes, 
and therefore adopting MABA's comment may be misleading. Accordingly, 
this provision is not changed in the final rule.
    Fruit Shippers Ltd. commented that changes should be made to the 
definition of common carrier. However, the term is not defined in parts 
502 and 545, and the comments are not applicable to this rulemaking 
proceeding. The comment will be addressed when the proposed rule in 
Docket No. 98-29, Carrier Automated Tariff Systems, 63 FR 70368, is 
finalized. APL asked for leave to file a comment late in order to point 
out an error in terminology in Sec. 545.1. The nature of the comment, 
pointing out an obvious error, requires that it be accepted, even 
though filed late, and the error is corrected by replacing the term 
``conference'' with the OSRA terminology ``an agreement between or 
among ocean common carriers'' in Sec. 545.1.
    The rule contains no additional information collection or record 
keeping requirements and was not required to be submitted to OMB for 
approval under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.
    In accordance with the Regulatory Flexibility Act, 5 U.S.C. 601 et 
seq., the Chairman of the Federal Maritime Commission has certified to 
the Chief Counsel for Advocacy, Small Business Administration, that the 
rule will not have a significant impact on a substantial number of 
small entities. In its Notice of Proposed Rulemaking, the Commission 
stated its intention to certify this rulemaking because the amendments 
would either have no effect on small entities, or in the case where the 
amendments are likely to impact small entities, the economic impact 
will be de minimis. The comments received did not dispute the 
Commission's intention to certify, therefore, the certification is 
continued.
    This regulatory action is not a ``major'' rule under 5 U.S.C. 
804(2).

List of Subjects

46 CFR Part 502

    Administrative practice and procedure, Claims, Equal access to 
justice, Investigations, Lawyers, Maritime carriers, Penalties, 
Reporting and recordkeeping requirements.

46 CFR Parts 545 and 571

    Antitrust, Maritime carriers.
    For the reasons stated in the preamble, the Federal Maritime 
Commission amends 46 CFR parts 502, 545 and 571 as set forth below:

[[Page 7807]]

PART 502--RULES OF PRACTICE AND PROCEDURE

    1. The authority citation for part 502 is revised to read as 
follows:

    Authority: 5 U.S.C. 504, 551, 552, 553, 556(c), 559, 561-569, 
571-596; 12 U.S.C. 1141j(a); 18 U.S.C. 207; 26 U.S.C. 501(c)(3); 28 
U.S.C. 2112(a); 31 U.S.C. 9701; 46 U.S.C. app. 1114(b), 1705, 1707-
1711, 1713-1716; E.O. 11222 of May 8, 1965 (30 FR 6469); 21 U.S.C. 
853a; Pub. L. 105-258; and Pub. L. 88-777 (46 U.S.C. app. 817d, 
817e).

    2. Amend Sec. 502.1 as follows:
    a. Revise the first sentence of Sec. 502.1 to read as set forth 
below:
    b. Move ``[Rule 1.]'' to the end of the section.


Sec. 502.1  Scope of rules in this part.

    The rules in this part govern procedure before the Federal Maritime 
Commission, hereinafter referred to as the ``Commission,'' under the 
Merchant Marine Act, 1920, Merchant Marine Act, 1936, Shipping Act of 
1984, as amended by the Ocean Shipping Reform Act of 1998, 
Administrative Procedure Act, and related acts, except that subpart R 
of this part does not apply to proceedings subject to sections 7 and 8 
of the Administrative Procedure Act, which are to be governed only by 
subparts A to Q inclusive, of this part. * * *
    3. Amend Sec. 502.2 to read as follows:
    a. In the text of paragraph (c) revise ``Sec. 502.11(b)'' to read 
``Sec. 502.11.''
    b. In paragraph (d) remove ``[Rule 2.]''
    c. Add paragraph (e) to read as follows:


Sec. 502.2  Filing of documents; hours; mailing address.

* * * * *
    (e) Any pleading, document, writing or other paper submitted for 
filing which is rejected because it does not conform to the rules in 
this part shall be returned to the sender. [Rule 2.]
    4. Amend Sec. 502.11 as follows:
    a. Revise section heading to read as set forth below;
    b. Remove paragraph (a) and the heading of paragraph (b);
    c. Redesignate paragraphs (b)(1) through (b)(7) as paragraphs (a) 
through (g).


Sec. 502.11  Ex parte communications.

* * * * *


Sec. 502.12  [Amended]

    5. In Sec. 502.12, add ``[Rule 12.]'' to the end of the text.
    6. In Sec. 502.21, revise the paragraph heading in paragraph (c) to 
read as follows:


Sec. 502.21  Appearance.

* * * * *
    (c) Special appearance. * * *
    7. Revise Sec. 502.23 to read as follows:


Sec. 502.23  Notice of appearance; substitution and withdrawal of 
representative.

    (a) Upon filing of a complaint instituting proceedings or filing of 
an answer to an order or complaint, the party filing shall notify the 
Commission of the name(s) and address(es) of the person or persons who 
will represent them in the pending proceeding. Each person who appears 
at a hearing shall deliver a written notice of appearance to the 
reporter, stating for whom the appearance is made. Such notice shall 
indicate whether the representative wishes to be notified of decisions 
by telephone, facsimile transmission, or electronic mail. All 
appearances shall be noted in the record. Petitions for leave to 
intervene shall indicate the name(s) and address(es) of the person or 
persons who will represent the intervenor in the pending proceeding if 
the petition is granted.
    (b) A Notice of Appearance should follow the form set forth in 
Exhibit No. 1 to this subpart.
    (c) If an attorney or other representative of record is superseded, 
there shall be filed a stipulation of substitution signed both by the 
attorney(s) or representative(s) and by the party, or a written notice 
from the party to the Commission.
    (d) If an attorney wishes to withdraw from representing a party, 
such attorney shall file an appropriate motion seeking permission to 
withdraw and provide appropriate reasons for making the motion. Such 
motion will be decided in consideration of the factors and standards 
set forth in Rule 1.16 of the American Bar Association's Model Rules of 
Professional Conduct and by the courts.
    8. Revise Sec. 502.24(b) to read as follows:


Sec. 502.24  Practice before the Commission defined.

* * * * *
    (b) The term ``Commission'' as used in this subpart includes any 
bureau, division, office, branch, section, or unit of the Federal 
Maritime Commission and any officer or employee of such bureau, 
division, office, branch, section, or unit. [Rule 24.]
    9. Revise Sec. 502.26, to read as follows:


Sec. 502.26  Attorneys at law.

    Attorneys at law who are admitted to practice before the Federal 
courts or before the courts of any State or Territory of the United 
States may practice before the Commission. An attorney must represent 
in writing, filed with the Secretary, that he is admitted to practice 
and in good standing. An attorney practicing before the Commission is 
expected to conform to the standards of conduct set forth in the 
American Bar Association's Model Rules of Professional Conduct in 
addition to the specific requirements of this chapter. [Rule 26.]
    10. In Sec. 502.27(a)(1) correct ``Sec. 503.43(h)'' to read 
``Sec. 503.43(g).''
    11. Revise Exhibit No. 1 to Subpart B as follows:

Exhibit No. 1 to Subpart B

Federal Maritime Commission

Notice of Appearance

    Docket No. ________:
    Please enter my appearance in this proceeding as counsel for 
________.
    I request to be informed of service of the administrative law 
judge's initial or recommended decision and of the Commission's 
decision in this proceeding by:
[  ] telephone (In the event that I am not available when you call, 
appropriate advice left with my office will suffice.)
[  ] facsimile transmission
[  ] electronic mail

----------------------------------------------------------------------
[Name]

----------------------------------------------------------------------
[Address]

----------------------------------------------------------------------
[Telephone No.]

----------------------------------------------------------------------
[Fax No.]

----------------------------------------------------------------------
[E-mail address]

----------------------------------------------------------------------
[Signature]

    12. Revise Sec. 502.42 to read as follows:


Sec. 502.42  Bureau of Enforcement.

    The Director, Bureau of Enforcement, shall be a party to all 
proceedings governed by the rules in this part except that in complaint 
proceedings under Sec. 502.62, the Director may become a party only 
upon leave to intervene granted pursuant to Sec. 502.72, in rulemaking 
proceedings and in proceedings considering petitions the Director may 
become a party by designation if the Commission determines that the 
circumstances of the proceeding warrant such participation, and the 
Director will not ordinarily be a party to small claims proceedings 
under Sec. 502.304 and special docket proceedings under Sec. 502.271. 
The Director or the Director's representative shall be served with 
copies of all papers, pleadings, and documents in every proceeding in 
which the Bureau of Enforcement is a party. The Bureau of Enforcement 
shall actively participate in any proceeding to which the Director is a 
party, to the extent required in the

[[Page 7808]]

public interest, subject to the separation of functions required by 
section 5(c) of the Administrative Procedure Act. (See Sec. 502.224). 
[Rule 42.]
    13. Revise Sec. 502.51 to read as follows:


Sec. 502.51  Initiation of procedure to issue, amend, or repeal a rule.

    (a) By petition. Any interested party may file with the Commission 
a petition for the issuance, amendment, or repeal of a rule designed to 
implement, interpret, or prescribe law, policy, organization, 
procedure, or practice requirements of the Commission. The petition 
shall set forth the interest of petitioner and the nature of the relief 
desired, shall include any facts, views, arguments, and data deemed 
relevant by petitioner, and shall be verified. If such petition is for 
the amendment or repeal of a rule, it shall be accompanied by proof of 
service on all persons, if any, specifically named in such rule, and 
shall conform in other aspects to subpart H of this part. Petitions 
shall be accompanied by remittance of a $177 filing fee. Replies to 
such petition shall conform to the requirements of Sec. 502.74.
    (b) By the Commission. The Commission on its own initiative may 
initiate the issuance, amendment, or repeal of a rule through notice of 
proposed rulemaking or advanced notice of proposed rulemaking. [Rule 
51.]


Sec. 502.56  [Amended]

    14. In Sec. 502.56, add ``[Rule 56.]'' at the end of the text.


Sec. 502.61  [Amended]

    15. In Sec. 502.61, add ``[Rule 61.]'' to the end of paragraph (d).
    16. In Sec. 502.62, redesignate paragraph (g) as paragraph (h), 
revise redesignated paragraph (h) and add new paragraph (g) to read as 
follows:


Sec. 502.62  Complaints and fee.

* * * * *
    (g) Complainants desiring to use the discovery provisions of 
subpart L must commence discovery at the time the complaint is filed, 
pursuant to Sec. 502.201(b).
    (h) For special types of cases, see Sec. 502.271 in subpart Q 
(Refund or waiver of freight charges); subpart K (Shortened Procedure); 
and subpart S (Small Claims). [Rule 62.]
    17. In Sec. 502.63, remove paragraph (a), redesignate paragraphs 
(b) through (e) as paragraphs (a) through (d), and revise the section 
heading to read as follows:


Sec. 502.63  Statute of limitations for reparations.

* * * * *
    18. Amend Sec. 502.64 as follows:
    a. Add a sentence to the end of paragraph (a) to read as set forth 
below;
    b. Add ``[Rule 64.]'' to the end of paragraph (d).


Sec. 502.64  Answer to complaint; countercomplaint.

    (a) * * *. An answer to the complaint must be verified.
* * * * *
    19. Add Sec. 502.67 to read as follows:


Sec. 502.67  Exemption procedures--General.

    (a) Authority. The Commission, upon application or on its own 
motion, may by order or rule exempt for the future any class of 
agreements between persons subject to the Shipping Act of 1984 or any 
specified activity of persons subject to the Shipping Act of 1984 from 
any requirement of the Shipping Act of 1984 if it finds that the 
exemption will not result in substantial reduction in competition or be 
detrimental to commerce. The Commission may attach conditions to any 
exemption and may, by order, revoke any exemption.
    (b) Application for exemption. Any person may petition the 
Commission for an exemption or revocation of an exemption of any class 
of agreements or an individual agreement or any specified activity 
pursuant to section 16 of the Shipping Act of 1984. A petition for 
exemption shall state the particular requirement of the Shipping Act of 
1984 for which exemption is sought. The petition shall also include a 
statement of the reasons why an exemption should be granted or revoked, 
shall provide information relevant to any finding required by the 
Shipping Act of 1984 and shall comply with Sec. 502.69. Where a 
petition for exemption of an individual agreement is made, the 
application shall include a copy of the agreement.
    (c) Participation by interested persons. No order or rule of 
exemption or revocation of exemption may be issued unless opportunity 
for hearing has been afforded interested persons and departments and 
agencies of the United States.
    (d) Federal Register notice. Notice of any proposed exemption or 
revocation of exemption, whether upon petition or upon the Commission's 
own motion, shall be published in the Federal Register. The notice 
shall include when applicable:
    (1) A short title for the proposed exemption or the title of the 
existing exemption;
    (2) The identity of the party proposing the exemption or seeking 
revocation;
    (3) A concise summary of the agreement or class of agreements or 
specified activity for which exemption is sought, or the exemption 
which is to be revoked;
    (4) A statement that the petition and any accompanying information 
are available for inspection in the Commission's offices in Washington, 
DC; and
    (5) The final date for filing comments regarding the proposal. 
[Rule 67.]


Sec. 502.71  [Amended]

    20. In Sec. 502.71, add ``[Rule 71.]'' to the end of the text.
    21. In Sec. 502.75, revise paragraph (a) to read as follows:


Sec. 502.75  Proceedings involving assessment agreements.

    (a) In complaint proceedings involving assessment agreements filed 
under section 5(e) of the Shipping Act of 1984, the Notice of Filing of 
Complaint and Assignment will specify a date before which the initial 
decision will be issued, which date will not be more than eight months 
from the date the complaint was filed.
* * * * *


Exhibit 1 to Subpart E    [Amended]

    22. In Exhibit 1 to Subpart E, remove the third paragraph after the 
heading ``Information to Assist in Filing Formal Complaint,'' beginning 
with the text ``Under the Shipping Act, 1916 * * *.''


Sec. 502.91  [Amended]

    23. In Sec. 502.91, add ``[Rule 91.]'' to the end of paragraph (d).


Sec. 502.92  [Removed and reserved] Exhibit 1 [Removed]

    24. In subpart F, remove and reserve Sec. 502.92, and remove 
Exhibit 1.


Sec. 502.94  [Amended]

    25. In Sec. 502.94, add ``[Rule 94.]'' to the end of paragraph (c).
    26. Revise Sec. 502.102 to read as follows:


Sec. 502.102  Enlargement of time to file documents.

    (a) Motions for enlargement of time for the filing of any pleading 
or other document, or in connection with the procedures of subpart L of 
this part, shall set forth the reasons for the motion and be submitted 
at least five (5) days before the scheduled date for filing. Except for 
good cause shown, failure to meet this time requirement may result in 
summary rejection of the request.
    (b) Such motions will be granted only under exceptional 
circumstances duly demonstrated in the request, and shall conform to 
the requirements of Subpart H of this part, except as to service if 
they show that the parties have received actual notice of the motion; 
and in

[[Page 7809]]

relation to briefs, exceptions, and replies to exceptions, such motions 
shall conform to the further provisions of Secs. 502.222 and 502.227.
    (c) Upon motion made after the expiration of the scheduled date, 
the filing may be permitted where reasonable grounds are found for the 
failure to file.
    (d) Replies to such motions for enlargement of time shall conform 
to the requirements of Sec. 502.74. [Rule 102.]
    27. Add two sentences before the last sentence of Sec. 502.104 to 
read as follows:


Sec. 502.104  Postponement of hearing.

    * * * Such motions must be received, whether orally or in writing, 
at least five (5) days before the scheduled date for hearing. Except 
for good cause shown, failure to meet this requirement may result in 
summary rejection of the request. * * *
    28. Revise Sec. 502.105 to read as follows:


Sec. 502.105  Waiver of rules governing enlargements of time and 
postponements of hearings.

    The Commission, the presiding officer, or the Chief Administrative 
Law Judge may waive the requirements of Secs. 502.102 and 502.104 as to 
replies and may rule ex parte on such requests. [Rule 105.]
    29. In subpart H, revise Sec. 502.111 to read as follows:


Sec. 502.111  Form and appearance of documents filed with Commission.

    (a) All papers to be filed under the rules in this part must be 
clear and legible, dated, show the docket description and title of the 
proceeding, and include the title, if any, and address of the signer. 
An original signed in ink must be provided. Text shall appear on only 
one side of the paper and must be double spaced except that quotations 
must be single spaced and indented. The paper must be strong and 
durable, not more than 8\1/2\ inches wide and 12 inches long, with a 
left hand margin of 1\1/2\ inches. Documents shall be printed in clear 
type, never smaller than 12 point.
    (b) Filings by facsimile for purposes of meeting a deadline will 
not be accepted unless authorized by the presiding officer or the 
Secretary.
    (c) Facsimile transmissions of signature pages on filings will be 
tentatively accepted for the purpose of meeting filing deadlines 
pending receipt of the original signature page within seven working 
days. [Rule 111.]
    30. Amend Sec. 502.112 as follows:
    a. Revise the section heading to read as set forth below;
    b. Add ``[Rule 112.]'' to the end of paragraph (c)(2).


Sec. 502.112  Verification of documents.

* * * * *
    31. Revise Sec. 502.113 to read as follows:


Sec. 502.113  Service by the Commission.

    (a) Complaints filed pursuant to Sec. 502.62, (including any 
accompanying discovery requests initiated pursuant to Sec. 502.201(b)), 
amendments to complaints (unless otherwise authorized by the presiding 
officer pursuant to Sec. 502.70(b)), and complainant's memoranda filed 
in shortened procedure cases will be served by the Secretary of the 
Commission.
    (b) The complainant may also effect proper service, in which case 
an affidavit setting forth the method, time and place of service must 
be filed with the Secretary within five days following service.
    (c) In addition to and accompanying the original of every document 
filed with the Commission for service by the Commission, there shall be 
a sufficient number of copies for use of the Commission (see 
Sec. 502.118) and for service on each party to the proceeding.
    (d) The presiding officer may dismiss a complaint that has not been 
served within thirty (30) days after the complaint was filed. [Rule 
113.]
    32. In Sec. 502.114, revise the section heading and paragraph (a) 
to read as follows:


Sec. 502.114  Service by parties of pleadings and other documents.

    (a) Except as otherwise specifically provided by the rules in this 
part, all pleadings, documents, and papers of every kind (except 
requests for subpoenas, documents served by the Commission under 
Sec. 502.113, and documents submitted at a hearing or prehearing 
conference) in proceedings before the Commission under the rules in 
this part shall, when tendered to the Commission or the presiding 
officer for filing, show that service has been made upon all parties to 
the proceeding and upon any other persons required by the rules in this 
part to be served. Such service shall be made by delivering one copy to 
each party; by hand delivering in person; by mail, properly addressed 
with postage prepaid; by courier; or by facsimile transmission if 
agreed by both parties prior to service.
* * * * *


Sec. 502.114  [Amended]

    33. Amend Sec. 502.114(b) as follows:
    a. Revise ``(Rule 53)'' to read ``(Rule 52).''
    b. Revise ``(Part 585)'' to read ``(Part 550).''
    c. Revise ``13(b)(5) of the Shipping Act of 1984, 46 U.S.C. app. 
1712(b)(5) (part 587)'' to read ``13(b)(6) of the Shipping Act of 1984 
(part 560).''
    34. Revise Sec. 502.116 to read as follows:


Sec. 502.116  Date of service.

    The date of service of documents served by the Commission shall be 
the date shown in the service stamp thereon. The date of service of 
documents served by parties shall be the date when matter served is 
deposited in the United States mail, delivered to a courier, delivered 
in person, or transmitted by facsimile, as the case may be. In 
computing the time from such dates, the provisions of Sec. 502.101 
shall apply. [Rule 116.]
    35. In Sec. 502.118, revise paragraph (b)(2) to read as follows:


Sec. 502.118  Copies of documents for use of the Commission.

* * * * *
    (b) * * *
    (2) An original and four copies shall be filed with the Secretary 
of prehearing statements required by Sec. 502.95, stipulations under 
Sec. 502.162, notices of appearance required by Sec. 502.23, and all 
other motions, petitions, or other written communications seeking a 
ruling from the presiding administrative law judge.
* * * * *
    36. In Sec. 502.119, revise paragraphs (a) and (b) to read as 
follows:


Sec. 502.119  Documents containing confidential materials.

* * * * *
    (a) Filings shall be accompanied by a transmittal letter which 
identifies the filing as ``confidential'' and describes the nature and 
extent of the authority for requesting confidential treatment. The 
confidential copies shall consist of the complete filing and shall 
include a cover page marked ``Confidential-Restricted,'' with the 
confidential materials clearly marked on each page.
    (b) Whenever a confidential filing is submitted, there must also be 
submitted an original and one copy of a public version of the filing. 
Such public version shall exclude confidential materials, and shall 
indicate on the cover page and on each affected page ``confidential 
materials excluded.''
* * * * *
    37. Revise Sec. 502.133 to read as follows:


Sec. 502.133  Attendance and mileage fees.

    Witnesses summoned by subpena to a hearing or deposition are 
entitled to the

[[Page 7810]]

same fees and mileage that are paid to witnesses in courts of the 
United States. Fees and mileage shall be paid, upon request, by the 
party at whose instance the witness appears. [Rule 133.]


Sec. 502.143  [Amended]

    38. In the text of Sec. 502.143 revise ``Sec. 502.133,'' to read 
``Sec. 502.113.''
    39. In Sec. 502.144,
    a. Redesignate the current text as paragraph (a);
    b. Revise the section heading to read as set forth below;
    c. Revise the last sentence of newly redesignated paragraph (a) to 
read as set forth below;
    d. Add new paragraph (b) to read as set forth below.


Sec. 502.144  Notice of time and place of hearing; postponement of 
hearing

    (a) * * * Notice may be served by mail, facsimile transmission, or 
electronic mail.
    (b) Motions for postponement of any hearing date shall be filed in 
accordance with Sec. 502.104. [Rule 144.]
    40. In Sec. 502.146, revise paragraph (a) and paragraph (c) to read 
as follows:


Sec. 502.146  Commencement of functions of Office of Administrative Law 
Judges.

* * * * *
    (a) Upon the service by the Commission of a complaint filed 
pursuant to Sec. 502.62, or Sec. 502.182, or upon referral under 
subpart T of this part; or
* * * * *
    (c) Upon forwarding for assignment by the Office of the Secretary 
of a special docket application pursuant to Sec. 502.271; or
* * * * *
    41. In the first sentence of paragraph (a) of Sec. 502.147 remove 
the phrase ``except with regard to that portion of any order involving 
the Commission's suspension authority set forth in section 3, 
Intercoastal Shipping Act, 1933.''
    42. In Sec. 502.147, revise paragraph (b) to read as follows:


Sec. 502.147  Functions and powers.

* * * * *
    (b) All of the functions delegated in Subparts A to Q and Subpart T 
of this part, inclusive, to the Chief Judge, presiding officer, or 
administrative law judge include the functions with respect to hearing, 
determining, ordering, certifying, reporting, or otherwise acting as to 
any work, business, or matter, pursuant to the provisions of section 
105 of Reorganization Plan No. 7 of 1961. [Rule 147.]
    43. Amend Sec. 502.201 as follows:
    a. Revise paragraph (a) to read as set forth below;
    b. Revise the paragraph headings in paragraph (d) and (f) to read 
as follows:


Sec. 502.201  General provisions governing discovery.

    (a) Applicability. The procedures described in this subpart are 
available in all adjudicatory proceedings under the Shipping Act of 
1984. Unless otherwise ordered by the presiding officer, the copy 
requirements of Sec. 502.118(b)(3)(i) shall be observed.
* * * * *
    (d) Duty of the parties to meet or confer. * * *
    (f) Conferences by order of the presiding officer. * * *
* * * * *
    44. In Sec. 502.221, revise paragraph (f) to read as follows:


Sec. 502.221  Briefs; requests for findings.

* * * * *
    (f) All briefs filed pursuant to this section shall ordinarily be 
limited to eighty (80) pages in length, exclusive of pages containing 
the table of contents, table of authorities, and certificate of 
service, unless the presiding officer allows the parties to exceed this 
limit for good cause shown and upon application filed not later than 
five (5) days before the time fixed for filing of such a brief or 
reply. [Rule 221.]
    45. Revise Sec. 502.223 to read as follows:


Sec. 502.223  Decisions--Administrative law judges.

    To the administrative law judges is delegated the authority to make 
and serve initial or recommended decisions. All initial and recommended 
decisions will include a statement of findings and conclusions, as well 
as the reasons or basis therefor, upon all the material issues 
presented on the record, and the appropriate rule, order, sanction, 
relief, or denial thereof. Where appropriate, the statement of findings 
and conclusions should be numbered. Initial decisions should address 
only those issues necessary to a resolution of the material issues 
presented on the record. A copy of each decision when issued shall be 
served on the parties to the proceeding. In proceedings involving 
overcharge claims, the presiding officer may, where appropriate, 
require that the carrier publish notice in its tariff of the substance 
of the decision. This provision shall also apply to decisions issued 
pursuant to subpart T of this part. [Rule 223.]
    46. Revise Sec. 502.225 to read as follows:


Sec. 502.225  Decisions--Commission.

    All final decisions will include a statement of findings and 
conclusions, as well as the reasons or basis therefor, upon all the 
material issues presented on the record, and the appropriate rule, 
order, sanction, relief, or denial thereof. A copy of each decision 
when issued shall be served on the parties to the proceeding. This 
provision shall also apply to decisions issued pursuant to subpart T of 
this part. [Rule 225.]
    47. Amend Sec. 502.227 as follows:
    a. Revise the section heading to read as set forth below;
    b. Redesignate paragraphs (a)(4) through (6) as paragraphs (a)(5) 
through (7);
    c. Add a new paragraph (a)(4) to read as set forth below;
    d. Remove ``[Rule 227]'' from paragraph (d);
    e. Add new paragraph (e) to read as set forth below.


Sec. 502.227  Exceptions to decisions or orders of dismissal of 
administrative law judge; replies thereto; review of decisions or 
orders of dismissal by Commission; and judicial review.

    (a) * * *
    (4) A decision or order of dismissal by an administrative law judge 
shall only be considered final for purposes of judicial review if the 
party has first sought review by the Commission pursuant to this 
section.
* * * * *
    (e) All briefs and replies filed pursuant to this section shall 
ordinarily be limited to fifty (50) pages in length, exclusive of pages 
containing the table of contents, table of authorities, and certificate 
of service, unless the Commission allows the parties to exceed this 
limit for good cause shown and upon application filed not later than 
five (5) days before the time fixed for filing of such a brief or 
reply. [Rule 227.]
    48. Revise Sec. 502.253 to read as follows:


Sec. 502.253  Interest in reparation proceedings.

    Except as to applications for refund or waiver of freight charges 
under Sec. 502.271 and claims which are settled by agreement of the 
parties, and absent fraud or misconduct of a party, interest granted on 
awards of reparation in complaint proceedings instituted under the 
Shipping Act of 1984 will accrue from the date of injury to the date 
specified in the Commission order awarding reparation. Compounding will 
be daily from the date of injury to the date specified in the 
Commission order awarding reparation. Normally, the date specified 
within which payment must be made will be fifteen (15) days subsequent 
to the date of service of the

[[Page 7811]]

Commission order. Interest shall be computed on the basis of the 
average monthly secondary market rate on six-month U.S. Treasury bills 
commencing with the rate for the month that the injury occurred and 
concluding with the latest available monthly U.S. Treasury bill rate at 
the date of the Commission order awarding reparation. The monthly 
secondary market rates on six-month U.S. Treasury bills for the 
reparation period will be summed up and divided by the number of months 
for which interest rates are available in the reparation period to 
determine the average interest rate applicable during the period. [Rule 
253.]
    49. Amend Sec. 502.254 as follows:
    a. Revise the first sentence of paragraph (a) to read as set forth 
below;
    b. Revise paragraph (c)(1)(i) to read as set forth below.


Sec. 502.254  Attorney's fees in reparation proceedings.

    (a) Scope. The Commission shall, upon petition, award the 
complainant reasonable attorney's fees directly related to obtaining a 
reparations award in any complaint proceeding under section 11 of the 
Shipping Act of 1984. * * *
    (c) * * * (1) * * *
    (i) With the presiding officer where the presiding officer's 
decision awarding reparations became administratively final pursuant to 
Sec. 502.227(a)(3) and Sec. 502.304(g); or
* * * * *
    50. Revise subpart Q consisting of Sec. 502.271 to read as follows:

Subpart Q--Refund or Waiver of Freight Charges


Sec. 502.271  Special docket application for permission to refund or 
waive freight charges.

    (a)(1) A common carrier or a shipper may file a special docket 
application seeking permission for a common carrier or conference to 
refund or waive collection of a portion of freight charges if there is:
    (i) An error in the tariff;
    (ii) An error in failing to publish a new tariff; or
    (iii) An error in quoting a tariff .
    (2) Such refund or waiver must not result in discrimination among 
shippers, ports, or carriers.
    (b) Such application must be filed within one hundred eighty (180) 
days from the date of sailing of the vessel from the port at which the 
cargo was loaded. An application is filed when it is placed in the 
mail, delivered to a courier, or, if delivered by another method, when 
it is received by the Commission. Filings by mail or courier must 
include a certification as to date of mailing or delivery to the 
courier.
    (c) Prior to submission of the application for a refund for an 
error in a tariff or a failure to publish a new tariff, the carrier or 
conference must publish a new tariff which sets forth the rate on which 
refund or waiver would be based.
    (d) Such application must be in accordance with Exhibit 1 to this 
Subpart and must also comply with the following requirements:
    (1) Applications must be submitted to the Office of the Secretary, 
Federal Maritime Commission, Washington, DC 20573-0001.
    (2) Applications must be submitted in an original and one (1) copy.
    (3) Applications must be sworn to before a notary public or 
otherwise verified in accordance with Sec. 502.112.
    (4) When a rate published in a conference tariff is involved, the 
carrier or shipper must serve a copy of the application on the 
conference and so certify in accordance with Sec. 502.117 to that 
service in the application. A shipper must also make a similar service 
and certification with respect to the common carrier.
    (5) Applications must be accompanied by remittance of an $86 filing 
fee.
    (e) Any application which does not furnish the information required 
by this Subpart may be returned to the applicant by the Secretary 
without prejudice to resubmission within the 180-day limitation period.
    (f)(1) The Secretary in his discretion shall assign all 
applications to either a Special Dockets Officer or the Office of 
Administrative Law Judges. Authority to issue decisions under this 
subpart is delegated to the assigned Special Dockets Officer or 
Administrative Law Judge.
    (2) Applicants will be notified as to the assignment of a deciding 
official, and the assignment of a special docket number. Formal 
proceedings as described in other rules of this part need not be 
conducted. The deciding official may, in his or her discretion, require 
the submission of additional information.
    (g) The deciding official shall issue a decision which, pursuant to 
Sec. 501.21 of this chapter, shall become final ten (10) days after 
service of such decision, unless the Commission in its discretion 
chooses to review such decision within that time, or the applicant 
chooses to file exceptions to such decision within that time. [Rule 
271.]

Exhibit No. 1 to Subpart Q

Application for Refund or Waiver of Freight Charges Due to Tariff 
or Quoting Error

    Federal Maritime Commission Special Docket No. ________ [leave 
blank].
    Amount of Freight Charges to be refunded or waived:
    Application of (Name of carrier or shipper) for the benefit of 
(Name of person who paid or is responsible for payment of freight 
charges).
    1. Shipment(s). Here fully describe:
    (a) Commodity (according to tariff description).
    (b) Number of shipments.
    (c) Weight or measurement, container size, and number of 
containers of individual shipment, as well as all shipments.
    (d)(1) Date(s) of receipt of shipment(s) by the carrier;
    (2) Date(s) of sailing(s) (furnish supporting evidence).
    (e) Shipper and place of origin.
    (f) Consignee, place of destination and routing of shipment(s).
    (g) Name of carrier and date shown on bill of lading (furnish 
legible copies of bill(s) of lading).
    (h) Names of participating ocean carrier(s).
    (i) Name(s) of vessel(s) involved in carriage.
    (j) Amount of freight charges actually collected (furnish 
legible copies of rated bill(s) of lading or freight bill(s), as 
appropriate) broken down (i) per shipment, (ii) in the aggregate, 
(iii) by whom paid, (iv) who is responsible for payment if 
different, and (v) date(s) of collection.
    (k) Rate and tariff commodity description applicable at time of 
shipment (furnish legible copies of tariff materials).
    (l) Rate and commodity description sought to be applied (furnish 
legible copies of applicable tariff materials).
    (m)(1) Amount of applicable freight charges, per shipment and in 
the aggregate;
    (2) Amount of freight charges at rate sought to be applied, per 
shipment and in the aggregate.
    (n) Amount of freight charges sought to be (refunded) (waived), 
per shipment and in the aggregate.
    2. Furnish docket numbers of other special docket applications 
or decided or pending formal proceedings involving the same rate 
situations.
    3. Fully explain the basis for the application, i.e., the error, 
failure to publish, or misquote, showing why the application should 
be granted. Furnish affidavits, if appropriate, and legible copies 
of all supporting documents. If the error is due to failure to 
publish a tariff, specify the date when the carrier and/or 
conference intended or agreed to publish a new tariff. If the 
application is based on a misquote, the application must include the 
affidavit of the person who made the misquote describing the 
circumstances surrounding such misquote along with any other 
supporting documentary evidence available.
    4. Furnish any information or evidence as to whether granting 
the application may result in discrimination among shippers, ports 
or carriers. List any shipments of other

[[Page 7812]]

shippers of the same commodity which (i) moved via the carrier(s) or 
conference involved in this application during the period of time 
beginning on the date the intended rate would have become effective 
and ending on the day before the effective date of the conforming 
tariff; (ii) moved on the same voyage(s) of the vessel(s) carrying 
the shipment(s) described in No. 1, above; or (iii), in the case of 
a misquote, moved between the date of receipt of shipment(s) 
described in No. 1 above, and the date(s) of sailing(s).
    (Here set forth Name of Applicant, Signature of Authorized 
Person, Typed or Printed Name of Person, Title of Person and Date)
    State of , County of . ss:
    I,______ , on oath declare that I am ______ of the above-named 
applicant, that I have read this application and know its contents, 
and that they are true. Subscribed and sworn to before me, a notary 
public in and for the State of ____________ , County of 
____________, this ______ day of ______ .
(Seal)
----------------------------------------------------------------------
    Notary Public
    My Commission expires.

CERTIFICATE OF SERVICE (if applicable)

    I hereby certify that I have this day served the foregoing 
document upon the (insert the conference name if a conference tariff 
is involved; or the name of the carrier if the applicant is a 
shipper) by delivering a copy (insert means by which copy 
delivered).
    Dated in (insert city, county, state) this ______ day of ______. 
(signature)
    For:

CERTIFICATE OF MAILING

    I certify that the date shown below is the date of mailing (or 
date of delivery to courier) of the original and one (1) copy of 
this application to the Secretary, Federal Maritime Commission, 
Washington, DC, 20573-0001.
    Dated at ______, this ______ day of ______ .
    (Signature) .
    For.


Sec. 502.301  [Amended]

    51. In Sec. 502.301, remove paragraph (b) and redesignate 
paragraphs (c) and (d) as paragraphs (b) and (c).


Sec. 502.302  [Amended]

    52. In Sec. 502.302, remove paragraph (b) and redesignate paragraph 
(c) as paragraph (b).
    53. Revise Sec. 502.305 to read as follows:


Sec. 502.305  Applicability of other rules of this part.

    Except Secs. 502.253 and 502.254 or as otherwise specifically 
provided in this subpart, the rules in subparts A through Q, inclusive, 
of this part do not apply to situations covered by this subpart. [Rule 
305.]


Exhibit 1 to Subpart S  [Amended]

    54. In Exhibit 1 to subpart S, in the section entitled Information 
to Assist in Filing Informal Complaints, remove the third paragraph 
beginning with the text ``Under the Shipping Act, 1916 * * *.''
    55. Revise Sec. 502.321 to read as follows:


Sec. 502.321  Applicability of other rules of this part.

    Except as specifically provided in this part, rules in subparts A 
through Q, inclusive, of this part do not apply to situations covered 
by this subpart. [Rule 321.]


Sec. 502.401  [Amended]

    56. Amend Sec. 502.401 as follows:
    a. Amend paragraph (b) by removing ``Shipping Act, 1916, 46 U.S.C. 
app. 801 et seq.;'' and removing ``the Intercoastal Shipping Act 1933, 
46 U.S.C. app. 843 et seq.''
    b. Remove paragraph (d), and redesignate paragraph (e) as paragraph 
(d).
    57. Amend Sec. 502.501 as follows:
    a. Add new paragraph (d)(2)(vi) to read as set forth below;
    b. Add new paragraph (e)(3) to read as set forth below;
    c. Revise the first sentence of paragraph (f)(2) to read as set 
forth below;
    d. Add ``[Rule 501.]'' to the end of paragraph (g).


Sec. 502.501  General provisions.

* * * * *
    (d) * * *
    (2) * * *
    (vi) For purposes of paragraph (e)(3) of this section, a small 
entity as defined in 5 U.S.C. 601.
    (e) Standards for awards. (1) * * *
    (2) * * *
    (3) In an adversary adjudication arising from a Commission action 
to enforce a party's compliance with a statutory or regulatory 
requirement, if the demand by the Commission is substantially in excess 
of the decision of the presiding officer and is unreasonable under the 
facts and circumstances of the case, the presiding officer shall award 
to the party fees and other expenses related to defending against the 
excessive demand, unless the party has committed a willful violation of 
law or otherwise acted in bad faith, or special circumstances make an 
award unjust.
* * * * *
    (f) Allowable fees and expenses. (1) * * *
    (2) No award for the fee of an attorney or agent under this subpart 
may exceed $125 per hour. * * *


Sec. 502.502  [Amended]

    58. In Sec. 502.502, add ``[Rule 502.]'' to the end of paragraph 
(d)(3).


Sec. 502.503  [Amended]

    59. In Sec. 502.503, add ``[Rule 503.]'' to the end of paragraph 
(j)(2).
    60. Revise Sec. 502.601 to read as follows:


Sec. 502.601  Purpose and scope.

    The purpose of this subpart is to implement the statutory 
provisions of section 19 of the Merchant Marine Act, 1920, section 13 
of the Shipping Act of 1984, and sections 2(c) and 3(c) of Pub. L. 89-
777 by establishing rules and regulations governing the compromise, 
assessment, settlement and collection of civil penalties arising under 
certain designated provisions of the Merchant Marine Act , 1920, the 
Shipping Act of 1984, Public Law 89-777, and/or any order, rule, or 
regulation (except for procedural rules and regulations contained in 
this part) issued or made by the Commission in the exercise of its 
powers, duties and functions under those statutes. [Rule 601.]
    61. Amend Sec. 502.602 as follows:
    a. Revise paragraph (h) to read as set forth below;
    b. Add ``[Rule 602.]'' to the end of paragraph (i).


Sec. 502.602  Definitions

* * * * *
    (h) Violation includes any violation of sections 19(6)(d), 19(7)(d) 
and 19(11) of the Merchant Marine Act, 1920; any provision of the 
Shipping Act of 1984; sections 2 and 3 of Pub. L. 89-777; and/or any 
order, rule or regulation (except for procedural rules and regulations 
contained in this part) issued or made by the Commission in the 
exercise of its powers, duties and functions under the Merchant Marine 
Act, 1920, the Shipping Act of 1984, or Pub. L. 89-777.
* * * * *


Sec. 502.603  [Amended]

    62. In Sec. 502.603, add ``[Rule 603.]'' to the end of paragraph 
(c).
    63. Amend Sec. 502.604 as follows:
    a. Revise the first sentence of paragraph (b) to read as follows:


Sec. 502.604  Compromise of penalties: Relation to assessment 
proceedings.

* * * * *
    (b) Notice. When the Commission considers it appropriate to afford 
an opportunity for the compromise of a civil penalty, it will, except 
when otherwise authorized by the Commission, or where circumstances 
render it unnecessary, send a Notice and Demand Letter (``NDL'') to the

[[Page 7813]]

respondent, by registered or certified mail, or by other means 
reasonably calculated to give notice. * * *
    b. Add ``[Rule 604.]'' to the end of paragraph (g).
    64. Amend Sec. 502.605 as follows:
    a. Revise paragraph (a) to read as follows:
    b. Add ``[Rule 605.]'' to the end of paragraph (c).


Sec. 502.605  Payment of penalty; Method; default.

    (a) Method. Payment of penalties by the respondent is to be made by 
bank cashier's check or other instrument acceptable to the Commission.
* * * * *

PART 571--INTERPRETATIONS AND STATEMENTS OF POLICY [REDESIGATED AS 
PART 545]

    1. Redesignate part 571 as part 545.

PART 545--[REDESIGNATED FROM PART 571 AND AMENDED]

    2. The authority citation for redesignated part 545 continues to 
read as follows:

    Authority: 5 U.S.C. 553, 46 U.S.C. app. 1706, 1707, 1709, and 
1716.

    3. In redesignated Sec. 545.1, revise paragraph (a) to read as 
follows:


Sec. 545.1  Interpretation of Shipping Act of 1984--Refusal to 
negotiate with shippers' associations.

    (a) Section 8(c) of the Shipping Act of 1984 (``1984 Act'') 
authorizes ocean common carriers and conferences to enter into a 
service contract with a shippers' association, subject to the 
requirements of the 1984 Act. Section 10(b)(10) of the 1984 Act 
prohibits carriers from unreasonably refusing to deal or negotiate. 
Section 7(a)(2) of the 1984 Act exempts from the antitrust laws any 
activity within the scope of that Act, undertaken with a reasonable 
basis to conclude that it is pursuant to a filed and effective 
agreement.
* * * * *
    By the Commission.
Bryant L. VanBrakle,
Secretary.
[FR Doc. 99-3621 Filed 2-16-99; 8:45 am]
BILLING CODE 6730-01-P