[Federal Register Volume 81, Number 81 (Wednesday, April 27, 2016)]
[Rules and Regulations]
[Pages 24703-24706]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-09760]


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FEDERAL MARITIME COMMISSION

46 CFR Part 535

[Docket No. 16-09]
RIN 3072-AC65


Optional Method of Filing Ocean Common Carrier and Marine 
Terminal Operator Agreements Subject to the Shipping Act of 1984

AGENCY: Federal Maritime Commission.

ACTION: Direct final rule; and request for comments.

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SUMMARY: The Federal Maritime Commission (FMC or Commission) amends its 
regulations relating to the method of filing Ocean Common Carrier and 
Marine Terminal Operator Agreements to provide for optional filing of 
these agreements through a new electronic filing system. This optional 
filing system is intended to facilitate more efficient filing, review, 
and publication of these agreements.

DATES: This rule is effective without further action on June 13, 2016, 
unless significant adverse comment is received by May 27, 2016. If 
significant adverse comment is received, the Federal Maritime 
Commission will publish a timely withdrawal of the rule in the Federal 
Register.

ADDRESSES: You may submit comments by the following methods:
     Email: [email protected]. Include in the subject line: 
``Docket No. 16-09, Commentor/Company name.'' Comments should be 
attached to the email as a Microsoft Word or text-searchable PDF 
document. Only non-confidential and public versions of confidential 
comments should be submitted by email.
     Mail: Karen V. Gregory, Secretary, Federal Maritime 
Commission, 800 North Capitol Street NW., Washington, DC 20573-0001. 
Phone: (202) 523-5725. Email: [email protected].
    Docket: For access to the docket to read background documents or 
comments received, go to the Commission's Electronic Reading Room at: 
http://www.fmc.gov/16-09.
    Confidential Information: The Commission will provide confidential 
treatment for identified confidential information to the extent allowed 
by law. If your comments contain confidential information, you must 
submit the following:
     A transmittal letter requesting confidential treatment 
that identifies the specific information in the comments for which 
protection is sought and demonstrates that the information is a trade 
secret or other confidential research, development, or commercial 
information.
     A confidential copy of your comments, consisting of the 
complete filing with a cover page marked ``Confidential-Restricted,'' 
and the confidential material clearly marked on each page. You should 
submit the confidential copy to the Commission by mail.
     A public version of your comments with the confidential 
information excluded. The public version must state ``Public Version--
confidential materials excluded'' on the cover page and on each 
affected page, and must clearly indicate any information withheld. You 
may submit the public version to the Commission by email or mail.

FOR FURTHER INFORMATION CONTACT: For questions regarding submitting 
comments or the treatment of confidential information, contact Karen V. 
Gregory, Secretary, Phone: (202) 523-5725. Email: [email protected]. 
For technical questions, contact Florence A. Carr, Director, Bureau of 
Trade Analysis. Phone: (202) 523-5796. Email: [email protected]. 
For legal questions, contact Tyler J. Wood, General Counsel. Phone: 
(202) 523-5740. Email: [email protected].

SUPPLEMENTARY INFORMATION: On January 18, 2011, President Obama issued 
Executive Order 13563 (E.O. 13563) to emphasize the importance of 
public participation in adopting regulations, integration and 
innovation in regulatory actions, flexible approaches in achieving 
regulatory objectives, and ensuring the objectivity of any scientific 
and technological information and process in regulatory actions. E.O. 
13563 requires executive agencies to develop a plan to periodically 
review their existing significant regulations to determine whether any 
such regulations should be modified, streamlined, expanded, or repealed 
so as to make such agencies' regulatory programs more effective and 
less burdensome in achieving the regulatory objectives. On July 11, 
2011, Executive Order 13579 was issued to encourage independent 
regulatory agencies to also pursue the goals stated in E.O. 13563.
    On November 4, 2011, the Commission issued its Plan for 
Retrospective Review of Existing Rules (Plan) and invited public 
comment on how it might improve the current regulations.\1\ The Plan 
included a review schedule for the Commission's existing regulations, 
which was updated

[[Page 24704]]

on February 13, 2013. Among the comments received in response to the 
Plan were the Comments of Ocean Common Carriers on May 18, 2012.\2\
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    \1\ A copy of the Plan and comments filed in response to the 
Plan that are within the scope of this rulemaking have been placed 
in the docket.
    \2\ The commenting carriers consisted of a total of thirty ocean 
carriers participating in the following agreements active at that 
time: The fourteen members of the Transpacific Stabilization 
Agreement (TSA); ten members of the Westbound Transpacific 
Stabilization Agreement (WTSA); six members of the Central America 
Discussion Agreement (CADA); eleven members of the West Coast South 
America Discussion Agreement (WCSADA); five members of the Venezuela 
Discussion Agreement (VDA); three members of the ABC Discussion 
Agreement (ABCDA); six members of the United States Australasia 
Discussion Agreement (USADA); and, the three members of the 
Australia New Zealand United States Discussion Agreement (ANZUSDA). 
The carriers' recommendations with respect to agreements, with one 
exception, are being considered by the Commission under FMC Docket 
No. 16-04. See Advance Notice of Proposed Rulemaking, Ocean Common 
Carrier and Marine Terminal Operator Agreements Subject to the 
Shipping Act of 1984, 81 FR 10188 (Feb. 29, 2016). The exception 
referenced is the subject of this rulemaking.
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    The carriers' comments included a request for the Commission to 
``adopt rules and procedures pursuant to which carrier and marine 
terminal operator agreements can be filed electronically.'' The 
carriers pointed out that ``virtually all filings made with the 
Commission, other than agreement filings, are made electronically 
(e.g., agreement minutes, monitoring reports and guidelines, OTI 
license applications)'' and noted that ``[i]ronically, the Commission 
maintains an electronic library of agreements on its Web site, so these 
agreements are retained electronically in any event.'' While the 
carriers conclude that the electronic filing of agreements ``would 
reduce the burden and expense of filing for the industry,'' the 
Commission notes that doing so would also streamline its internal 
business processes, thereby resulting in a more efficient regulatory 
process and expediting public access to agreement filings through the 
Commission's Web site. These benefits are consistent with Executive 
Order 13579.
    Under the Commission's existing rules at 46 CFR 535.401, ``a true 
copy and seven additional copies of the executed agreement'' must be 
submitted in paper format to the Commission's Secretary during the 
regular business hours of 8:30 a.m. to 5:00 p.m., Monday through 
Friday. The agreement's filing must be accompanied by a letter of 
transmittal, and, where required, an original and five copies of the 
completed Information Form, also in paper format. To respond to the 
industry's request to reduce the regulatory burden associated with the 
filing of multiple copies of agreements and supporting documents in 
paper format, the Commission determined that automating the agreement 
filing process should be given priority.
    The FMC's Office of Information Technology (OIT), in conjunction 
with the Bureau of Trade Analysis (BTA), commenced efforts in October 
2015 to automate the process of filing agreements with the Commission. 
BTA met with various agreement filers during development to ensure that 
the new system would not only provide a user-oriented electronic filing 
environment but also deliver more robust public search capabilities for 
the online agreement library based on a variety of filters. Further 
enhancement of the online agreement library's search capabilities is 
planned in the future.
    Initial software development and associated testing to support the 
electronic agreement filing system has been completed. The Commission 
now plans to make this technology available as an optional method to 
file agreements and supporting documents. Use of the automated system 
will not be required, however, as parties may continue to submit 
agreements in paper format. Paper filings will be received and 
processed in the same manner as before.
    Under the new electronic agreement filing system, supporting 
documentation previously submitted in paper form may also be appended 
electronically as part of the filing process. Validity checks 
incorporated into the automated filing process will allow the filer to 
verify Commission information regarding agreement parties, thereby 
ensuring a more accurate public online agreement library, as well as 
facilitating review and oversight of agreements by the Commission. The 
system may be accessed through the Commission's Web site at http://www.fmc.gov under Public FMC Databases/Agreement Notices and Library. 
Prospective filers may register for the electronic agreement filing 
system and obtain a login and password by following the instructions on 
the system's Web page. As with current practice, the public will have 
the ability to view all agreements in the online agreement library; 
however, the public will not be able to view the filer's letter of 
transmittal and Information Form, if any. In addition, the filing 
system is password-protected to ensure the security of information 
being collected, primarily in supporting documents, and to 
appropriately restrict external filing permission to the agreement 
filer and its authorized filing agents.
    The Commission's rules presently require that each agreement and 
modification filed must be signed by an official or authorized 
representative of each of the parties and that the original signature 
page(s) accompany the agreement's filing. The rules allow some measure 
of flexibility to filers by permitting faxed or photocopied signatures 
to accompany the agreement's filing if the copies are replaced with 
original signatures prior to the agreement's effective date. Sec.  
535.403(d). Many times, the individuals who sign an agreement are 
located overseas or are traveling and may be required to transmit a 
signature page electronically to filing counsel in order to expedite an 
agreement's filing, and consequently, its effectiveness. In such cases, 
agreement counsel submits a photocopy of the parties' signature pages 
with the agreement's filing, and must follow up by sending the original 
signatures by mail or courier to the Commission prior to the effective 
date.
    While the Commission's rules presently require that the original 
signatures of the parties executing an agreement must be filed with the 
Commission, the Shipping Act of 1984 (the Act) 46 U.S.C. 40101 et seq., 
provides only that ``a true copy of every agreement . . . shall be 
filed with the Federal Maritime Commission'' and permits the Commission 
to prescribe the form and manner in which agreements are filed. 46 
U.S.C. 40302(a), (c). As the Act does not require the filing of the 
original agreement with the Commission, removing the parties' 
requirement to provide original signatures with an agreement's filing 
would eliminate an unnecessary regulatory burden. The Commission is, 
therefore, removing this requirement and will begin accepting 
photocopies and scanned electronic copies of the agreement parties' 
original signatures. The Commission is similarly removing the 
requirement that transmittal letters accompanying agreement filings 
include an original signature.

Congressional Review Act

    The rule is not a ``major rule'' as defined by the Congressional 
Review Act, codified at 5 U.S.C. 801 et seq. The rule will not result 
in: (1) An annual effect on the economy of $100,000,000 or more; (2) a 
major increase in costs or prices; or (3) significant adverse effects 
on competition, employment, investment, productivity, innovation, or 
the ability of United States-based companies to compete with foreign-
based companies. 5 U.S.C. 804(2).

Regulatory Flexibility Act

    In accordance with the Regulatory Flexibility Act, 5 U.S.C. 601 et 
seq., the Chairman of the Federal Maritime Commission certifies that 
this direct final rule will not have a significant

[[Page 24705]]

economic impact on a substantial number of small entities. The rule 
applies to the filing requirements for agreements by or among vessel-
operating common carriers (VOCCs) and/or marine terminal operators 
(MTOs). The Commission has previously determined that VOCCs and MTOs do 
not qualify as small entities because the number of employees and/or 
gross receipts of these regulated businesses typically exceed the 
thresholds set under the guidelines of the Small Business 
Administration.\3\ This rule implements an alternative electronic 
method for filing agreements with the Commission that is optional for 
the industry. The current regulations require that agreements be filed 
with the Commission in paper form. The new electronic system should 
significantly reduce the burden and expense of filing on the industry. 
Further, in comments to the Commission's Plan for the Retrospective 
Review of Existing Rules, a majority of VOCCs specifically requested 
that the Commission implement an electronic system for filing 
agreements.
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    \3\ See FMC Policy and Procedures Regarding Proper 
Considerations of Small Entities in Rulemakings, page 4 (February 7, 
2003), from the Web site of the FMC at http://www.fmc.gov/assets/1/Page/SBREFA_Guidelines_2003.pdf.
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Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521) requires 
an agency to seek and receive approval from the Office of Management 
and Budget (OMB) before collecting information from the public and 
before making substantive or material modifications to a previously 
approved information collection. 44 U.S.C. 3507; 5 CFR 1320.5(a), (g). 
The information-collection contained in Part 535, including the 
agreement-filing requirements, have been approved by OMB and assigned 
OMB Control Number 3072-0046. The Commission is modifying this 
information collection by allowing electronic filing of agreements and 
expects that this change will reduce the paperwork burdens on regulated 
entities. The Commission will, however, continue to allow paper filing 
of agreements. Accordingly, this modification is neither substantive 
nor material. The expiration date for the Part 535 information 
collection is November 30, 2016, and the Commission will note the 
modification and any resulting changes to the burden hour estimate when 
it seeks an extension of the information collection later this year.

Direct Final Rule Justification

    The Commission expects the amendments to be noncontroversial. Under 
the Administrative Procedure Act (APA), 5 U.S.C. 553(b)(B), a final 
rule may be issued without notice and comment when the agency for good 
cause finds (and incorporates the finding and a brief statement of 
reasons therefor in the rules issued) that notice and public procedure 
thereon are impracticable, unnecessary, or contrary to the public 
interest. This rule provides an optional electronic method of filing 
agreements and supporting documents as a more flexible and less 
burdensome alternative for the regulated parties to those agreements, 
and maintains the present paper format filing procedures for filers 
that wish to continue utilizing the current method. The electronic 
agreement filing system was developed at the behest, in 2012, of thirty 
global ocean common carriers participating in the major rate discussion 
agreements filed with the Commission to relieve the regulatory burden 
of paper filings. Further, the requirement to include original 
signatures to agreements and transmittal letters, rather than photo- or 
electronic copies, burdens filers and appears to provide limited, if 
any, public benefit. Thus, the Commission has determined that providing 
an opportunity for comment is unnecessary.
    Therefore, pursuant to 5 U.S.C. 553, notice and comment are not 
required and this rule may become effective after publication in the 
Federal Register, unless the Commission receives significant adverse 
comments within the specified period. The Commission recognizes that 
parties may have information that could impact the Commission's views 
and intentions with respect to the revised regulations, and the 
Commission intends to consider any comments filed. The Commission will 
withdraw the rule if it receives significant adverse comments. Filed 
comments that are not adverse may be considered for modifications to 
Part 535 at a future date.
    If no significant adverse comment is received, the rule will become 
effective 15 days after the close of the comment period without 
additional action. The Administrative Procedure Act generally requires 
a minimum of 30 days before a final rule can go into effect, but 
excepts from this requirement rules that relieve a restriction. 5 
U.S.C. 553(d)(1). Because this final rule provides for an additional, 
optional method of filing agreements and removes the requirement that 
agreement filings and accompanying transmittal letters include original 
signatures, the rule falls within this exception.

List of Subjects in 46 CFR Part 535

    Freight, Maritime carriers, Reporting and recordkeeping 
requirements.

Regulatory Text

    For the foregoing reasons, the Commission amends 46 CFR part 535 as 
follows:

PART 535--OCEAN COMMON CARRIER AND MARINE TERMINAL OPERATOR 
AGREEMENTS SUBJECT TO THE SHIPPING ACT OF 1984

0
1. The authority citation for part 535 continues to read as follows:

    Authority:  5 U.S.C. 553; 46 U.S.C. 305, 40101-40104, 40301-
40307, 40501-40503, 40901-40904, 41101-41109, 41301-41302, and 
41305-41307.

0
2. Amend Sec.  535.401 by revising paragraphs (a) and (b)(4) to read as 
follows:


Sec.  535.401  General requirements.

    (a) All agreements (including oral agreements reduced to writing in 
accordance with the Act) subject to this part and filed with the 
Commission for review and disposition pursuant to section 6 of the Act 
(46 U.S.C. 40304, 40306, 41307(b)-(d)), must be submitted to the 
Commission either in paper during regular business hours to the 
Secretary, Federal Maritime Commission, Washington, DC 20573, or 
electronically using the automated agreement filing system.
    (1) Paper filings. Paper filings must include:
    (i) A true copy and seven additional copies of the executed 
agreement;
    (ii) Where required by this part, an original and five copies of 
the completed Information Form referenced at subpart E of this part; 
and
    (iii) A letter of transmittal as described in paragraph (b) of this 
section.
    (2) Electronic filings. (i) Electronic filings using the automated 
agreement filing system must be made in accordance with the 
instructions found on the Commission's home page,  http://www.fmc.gov.
    (ii) Electronic filings must include searchable Portable Document 
Format (PDF) copies of the following:
    (A) A true copy of the executed agreement;
    (B) Where required by this part, a completed Information Form 
referenced at subpart E of this part; and
    (C) A letter of transmittal as described in paragraph (b) of this 
section.
    (b) * * *

[[Page 24706]]

    (4) Be signed by the filing party or on the filing party's behalf 
by an authorized employee or agent of the filing party. A faxed, 
photocopied, or scanned signature will be accepted.
* * * * *

0
3. Amend Sec.  535.403 by revising paragraph (d) to read as follows:


Sec.  535.403  Form of agreements.

* * * * *
    (d) Each agreement and/or modification filed must be signed by an 
official or authorized representative of each of the parties and must 
indicate the typewritten full name of the signing party and his or her 
position, including organizational affiliation. Faxed, photocopied, or 
scanned signatures will be accepted.
* * * * *

0
4. Amend Sec.  535.501 by revising the last sentence of paragraph (b) 
to read as follows:


Sec.  535.501  General requirements.

* * * * *
    (b) * * * In lieu of submitting paper copies, parties may complete 
and submit their Information Form in the Commission's prescribed 
electronic format, either on diskette or CD-ROM, or submit the 
Information Form using the automated agreement filing system in 
accordance with the instructions found on the Commission's home page, 
http://www.fmc.gov.
* * * * *

    By the Commission.
Karen V. Gregory,
Secretary.
[FR Doc. 2016-09760 Filed 4-26-16; 8:45 am]
 BILLING CODE 6731-AA-P