[105th Congress Public Law 258]
[From the U.S. Government Printing Office]


<DOC>
[DOCID: f:publ258.105]


[[Page 1901]]

                    OCEAN SHIPPING REFORM ACT OF 1998

[[Page 112 STAT. 1902]]

Public Law 105-258
105th Congress

                                 An Act


 
     To amend the Shipping Act of 1984 to encourage competition in 
  international shipping and growth of United States exports, and for 
          other purposes. <<NOTE: Oct. 14, 1998 -  [S. 414]>> 

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled, <<NOTE: Ocean Shipping 
Reform Act of 1998.>> 

SECTION 1. SHORT TITLE. <<NOTE: 46 USC app. 1701 note.>> 

    This Act may be cited as the ``Ocean Shipping Reform Act of 1998''.

SEC. 2. EFFECTIVE DATE. <<NOTE: 46 USC app. 1701 note.>> 

    Except as otherwise expressly provided in this Act, this Act and the 
amendments made by this Act take effect May 1, 1999.

             TITLE I--AMENDMENTS TO THE SHIPPING ACT OF 1984

SEC. 101. PURPOSE.

    Section 2 of the Shipping Act of 1984 (46 U.S.C. App. 1701) is 
amended by--
            (1) striking ``and'' after the semicolon in paragraph (2);
            (2) striking ``needs.'' in paragraph (3) and inserting 
        ``needs; and'';
            (3) adding at the end thereof the following:
            ``(4) to promote the growth and development of United States 
        exports through competitive and efficient ocean transportation 
        and by placing a greater reliance on the marketplace.''.

SEC. 102. DEFINITIONS.

    Section 3 of the Shipping Act of 1984 (46 U.S.C. App. 1702) is 
amended by--
            (1) striking ``the government under whose registry the 
        vessels of the carrier operate;'' in paragraph (8) and inserting 
        ``a government;'';
            (2) striking paragraph (9) and inserting the following:
            ``(9) `deferred rebate' means a return by a common carrier 
        of any portion of freight money to a shipper as a consideration 
        for that shipper giving all, or any portion, of its shipments to 
        that or any other common carrier over a fixed period of time, 
        the payment of which is deferred beyond the completion of 
        service for which it is paid, and is made only if the shipper 
        has agreed to make a further shipment or shipments with that or 
        any other common carrier.'';

[[Page 112 STAT. 1903]]

            (3) striking paragraph (10) and redesignating paragraphs 
        (11) through (27) as paragraphs (10) through (26);
            (4) striking ``in an unfinished or semifinished state that 
        require special handling moving in lot sizes too large for a 
        container,'' in paragraph (10), as redesignated;
            (5) striking ``paper board in rolls, and paper in rolls.'' 
        in paragraph (10) as redesignated and inserting ``paper and 
        paper board in rolls or in pallet or skid-sized sheets.'';
            (6) striking ``conference, other than a service contract or 
        contract based upon time-volume rates,'' in paragraph (13) as 
        redesignated and inserting ``agreement'';
            (7) striking ``conference.'' in paragraph (13) as 
        redesignated and inserting ``agreement and the contract provides 
        for a deferred rebate arrangement.'';
            (8) striking ``carrier.'' in paragraph (14) as redesignated 
        and inserting ``carrier, or in connection with a common carrier 
        and a water carrier subject to subchapter II of chapter 135 of 
        title 49, United States Code.'';
            (9) striking paragraph (16) as redesignated and 
        redesignating paragraphs (17) through (26) as redesignated as 
        paragraphs (16) through (25), respectively;
            (10) striking paragraph (17), as redesignated, and inserting 
        the following:
            ``(17) `ocean transportation intermediary' means an ocean 
        freight forwarder or a non-vessel-operating common carrier. For 
        purposes of this paragraph, the term--
                    ``(A) `ocean freight forwarder' means a person 
                that--
                          ``(i) in the United States, dispatches 
                      shipments from the United States via a common 
                      carrier and books or otherwise arranges space for 
                      those shipments on behalf of shippers; and
                          ``(ii) processes the documentation or performs 
                      related activities incident to those shipments; 
                      and
                    ``(B) `non-vessel-operating common carrier' means a 
                common carrier that does not operate the vessels by 
                which the ocean transportation is provided, and is a 
                shipper in its relationship with an ocean common 
                carrier.'';
            (11) striking paragraph (19), as redesignated and inserting 
        the following:
            ``(19) `service contract' means a written contract, other 
        than a bill of lading or a receipt, between one or more shippers 
        and an individual ocean common carrier or an agreement between 
        or among ocean common carriers in which the shipper or shippers 
        makes a commitment to provide a certain volume or portion of 
        cargo over a fixed time period, and the ocean common carrier or 
        the agreement commits to a certain rate or rate schedule and a 
        defined service level, such as assured space, transit time, port 
        rotation, or similar service features. The contract may also 
        specify provisions in the event of nonperformance on the part of 
        any party.''; and
            (12) striking paragraph (21), as redesignated, and inserting 
        the following:
            ``(21) `shipper' means--
                    ``(A) a cargo owner;
                    ``(B) the person for whose account the ocean 
                transportation is provided;
                    ``(C) the person to whom delivery is to be made;

[[Page 112 STAT. 1904]]

                    ``(D) a shippers' association; or
                    ``(E) an ocean transportation intermediary, as 
                defined in paragraph (17)(B) of this section, that 
                accepts responsibility for payment of all charges 
                applicable under the tariff or service contract.''.

SEC. 103. AGREEMENTS WITHIN THE SCOPE OF THE ACT.

    (a) Ocean Common Carriers.--Section 4(a) of the Shipping Act of 1984 
(46 U.S.C. App. 1703(a)) is amended by--
            (1) striking ``operators or non-vessel-operating common 
        carriers;'' in paragraph (5) and inserting ``operators;'';
            (2) striking ``and'' in paragraph (6) and inserting ``or''; 
        and
            (3) striking paragraph (7) and inserting the following:
            ``(7) discuss and agree on any matter related to service 
        contracts.''.

    (b) Marine Terminal Operators.--Section 4(b) of that Act (46 U.S.C. 
App. 1703(b)) is amended by--
            (1) striking ``(to the extent the agreements involve ocean 
        transportation in the foreign commerce of the United States)'';
            (2) striking ``and'' in paragraph (1) and inserting ``or''; 
        and
            (3) striking ``arrangements.'' in paragraph (2) and 
        inserting ``arrangements, to the extent that such agreements 
        involve ocean transportation in the foreign commerce of the 
        United States.''.

SEC. 104. AGREEMENTS.

    (a) In General.--Section 5 of the Shipping Act of 1984 (46 U.S.C. 
App. 1704) is amended by--
            (1) striking subsection (b)(8) and inserting the following:
            ``(8) provide that any member of the conference may take 
        independent action on any rate or service item upon not more 
        than 5 calendar days' notice to the conference and that, except 
        for exempt commodities not published in the conference tariff, 
        the conference will include the new rate or service item in its 
        tariff for use by that member, effective no later than 5 
        calendar days after receipt of the notice, and by any other 
        member that notifies the conference that it elects to adopt the 
        independent rate or service item on or after its effective date, 
        in lieu of the existing conference tariff provision for that 
        rate or service item;
            (2) redesignating subsections (c) through (e) as subsections 
        (d) through (f); and
            (3) inserting after subsection (b) the following:

    ``(c) Ocean Common Carrier Agreements.--An ocean common carrier 
agreement may not--
            ``(1) prohibit or restrict a member or members of the 
        agreement from engaging in negotiations for service contracts 
        with 1 or more shippers;
            ``(2) require a member or members of the agreement to 
        disclose a negotiation on a service contract, or the terms and 
        conditions of a service contract, other than those terms or 
        conditions required to be published under section 8(c)(3) of 
        this Act; or
            ``(3) adopt mandatory rules or requirements affecting the 
        right of an agreement member or agreement members to negotiate 
        and enter into service contracts.

An agreement may provide authority to adopt voluntary guidelines 
relating to the terms and procedures of an agreement member's

[[Page 112 STAT. 1905]]

or agreement members' service contracts if the guidelines explicitly 
state the right of members of the agreement not to follow the 
guidelines. <<NOTE: Confidentiality.>> These guidelines shall be 
confidentially submitted to the Commission.''.

    (b) Application.--
            (1) Subsection (e) of section 5 of that Act, <<NOTE: 46 USC 
        app. 1704.>> as redesignated, is amended by striking ``this Act, 
        the Shipping Act, 1916, and the Intercoastal Shipping Act, 1933, 
        do'' and inserting ``this Act does''; and
            (2) Subsection (f) of section 5 of that Act, as 
        redesignated, is amended by--
                    (A) striking ``and the Shipping Act, 1916, do'' and 
                inserting ``does'';
                    (B) striking ``or the Shipping Act, 1916,''; and
                    (C) inserting ``or are essential terms of a service 
                contract'' after ``tariff''.

SEC. 105. EXEMPTION FROM ANTITRUST LAWS.

    Section 7 of the Shipping Act of 1984 (46 U.S.C. App. 1706) is 
amended by--
            (1) inserting ``or publication'' in paragraph (2) of 
        subsection (a) after ``filing'';
            (2) striking ``or'' at the end of subsection (b)(2);
            (3) striking ``States.'' at the end of subsection (b)(3) and 
        inserting ``States; or''; and
            (4) adding at the end of subsection (b) the following:
            ``(4) to any loyalty contract.''.

SEC. 106. TARIFFS.

    (a) In General.--Section 8(a) of the Shipping Act of 1984 (46 U.S.C. 
App. 1707(a)) is amended by--
            (1) inserting ``new assembled motor vehicles,'' after 
        ``scrap,'' in paragraph (1);
            (2) striking ``file with the Commission, and'' in paragraph 
        (1);
            (3) striking ``inspection,'' in paragraph (1) and inserting 
        ``inspection in an automated tariff system,'';
            (4) striking ``tariff filings'' in paragraph (1) and 
        inserting ``tariffs'';
            (5) striking ``freight forwarder'' in paragraph (1)(C) and 
        inserting ``transportation intermediary, as defined in section 
        3(17)(A),'';
            (6) striking ``and'' at the end of paragraph (1)(D);
            (7) striking ``loyalty contract,'' in paragraph (1)(E);
            (8) striking ``agreement.'' in paragraph (1)(E) and 
        inserting ``agreement; and'';
            (9) adding at the end of paragraph (1) the following:
                    ``(F) include copies of any loyalty contract, 
                omitting the shipper's name.''; and
            (10) striking paragraph (2) and inserting the following:
            ``(2) Tariffs shall be made available electronically to any 
        person, without time, quantity, or other limitation, through 
        appropriate access from remote locations, and a reasonable 
        charge may be assessed for such access. No charge may be 
        assessed a Federal agency for such access.''.

    (b) Service Contracts.--Subsection (c) of that section is amended to 
read as follows:
    ``(c) Service Contracts.--

[[Page 112 STAT. 1906]]

            ``(1) In general.--An individual ocean common carrier or an 
        agreement between or among ocean common carriers may enter into 
        a service contract with one or more shippers subject to the 
        requirements of this Act. The exclusive remedy for a breach of a 
        contract entered into under this subsection shall be an action 
        in an appropriate court, unless the parties otherwise agree. In 
        no case may the contract dispute resolution forum be controlled 
        by or in any way affiliated with a controlled carrier as defined 
        in section 3(8) of this Act, or by the government which owns or 
        controls the carrier.
            ``(2) <<NOTE: Confidentiality.>> Filing requirements.--
        Except for service contracts dealing with bulk cargo, forest 
        products, recycled metal scrap, new assembled motor vehicles, 
        waste paper, or paper waste, each contract entered into under 
        this subsection by an individual ocean common carrier or an 
        agreement shall be filed confidentially with the Commission. 
        Each service contract shall include the following essential 
        terms--
                    ``(A) the origin and destination port ranges;
                    ``(B) the origin and destination geographic areas in 
                the case of through intermodal movements;
                    ``(C) the commodity or commodities involved;
                    ``(D) the minimum volume or portion;
                    ``(E) the line-haul rate;
                    ``(F) the duration;
                    ``(G) service commitments; and
                    ``(H) the liquidated damages for nonperformance, if 
                any.
            ``(3) <<NOTE: Public information.>> Publication of certain 
        terms.--When a service contract is filed confidentially with the 
        Commission, a concise statement of the essential terms described 
        in paragraphs 2 (A), (C), (D), and (F) shall be published and 
        made available to the general public in tariff format.
            ``(4) Disclosure of certain terms.--
                    ``(A) An ocean common carrier, which is a party to 
                or is subject to the provisions of a collective 
                bargaining agreement with a labor organization, shall, 
                in response to a written request by such labor 
                organization, state whether it is responsible for the 
                following work at dock areas and within port areas in 
                the United States with respect to cargo transportation 
                under a service contract described in paragraph (1) of 
                this subsection--
                          ``(i) the movement of the shipper's cargo on a 
                      dock area or within the port area or to or from 
                      railroad cars on a dock area or within the port 
                      area;
                          ``(ii) the assignment of intraport carriage of 
                      the shipper's cargo between areas on a dock or 
                      within the port area;
                          ``(iii) the assignment of the carriage of the 
                      shipper's cargo between a container yard on a dock 
                      area or within the port area and a rail yard 
                      adjacent to such container yard; and
                          ``(iv) the assignment of container freight 
                      station work and container maintenance and repair 
                      work performed at a dock area or within the port 
                      area.
                    ``(B) The common carrier shall provide the 
                information described in subparagraph (A) of this 
                paragraph to the

[[Page 112 STAT. 1907]]

                requesting labor organization within a reasonable period 
                of time.
                    ``(C) This paragraph requires the disclosure of 
                information by an ocean common carrier only if there 
                exists an applicable and otherwise lawful collective 
                bargaining agreement which pertains to that carrier. No 
                disclosure made by an ocean common carrier shall be 
                deemed to be an admission or agreement that any work is 
                covered by a collective bargaining agreement. Any 
                dispute regarding whether any work is covered by a 
                collective bargaining agreement and the responsibility 
                of the ocean common carrier under such agreement shall 
                be resolved solely in accordance with the dispute 
                resolution procedures contained in the collective 
                bargaining agreement and the National Labor Relations 
                Act, and without reference to this paragraph.
                    ``(D) Nothing in this paragraph shall have any 
                effect on the lawfulness or unlawfulness under this Act, 
                the National Labor Relations Act, the Taft-Hartley Act, 
                the Federal Trade Commission Act, the antitrust laws, or 
                any other Federal or State law, or any revisions or 
                amendments thereto, of any collective bargaining 
                agreement or element thereof, including any element that 
                constitutes an essential term of a service contract 
                under this subsection.
                    ``(E) For purposes of this paragraph the terms `dock 
                area' and `within the port area' shall have the same 
                meaning and scope as in the applicable collective 
                bargaining agreement between the requesting labor 
                organization and the carrier.''.

    (c) Rates.--Subsection (d) of that section is amended by--
            (1) striking the subsection caption and inserting ``(d) 
        Tariff Rates.--'';
            (2) striking ``30 days after filing with the Commission.'' 
        in the first sentence and inserting ``30 calendar days after 
        publication.'';
            (3) inserting ``calendar'' after ``30'' in the next 
        sentence; and
            (4) striking ``publication and filing with the Commission.'' 
        in the last sentence and inserting ``publication.''.

    (d) Refunds.--Subsection (e) of that section is amended by--
            (1) striking ``tariff of a clerical or administrative nature 
        or an error due to inadvertence'' in paragraph (1) and inserting 
        a comma; and
            (2) striking ``file a new tariff,'' in paragraph (1) and 
        inserting ``publish a new tariff, or an error in quoting a 
        tariff,'';
            (3) striking ``refund, filed a new tariff with the 
        Commission'' in paragraph (2) and inserting ``refund for an 
        error in a tariff or a failure to publish a tariff, published a 
        new tariff'';
            (4) inserting ``and'' at the end of paragraph (2); and
            (5) striking paragraph (3) and redesignating paragraph (4) 
        as paragraph (3).

    (e) Marine Terminal Operator Schedules.--Subsection (f) of that 
section is amended to read as follows:
    ``(f) Marine Terminal Operator Schedules.--A marine terminal 
operator may make available to the public, subject to section 10(d) of 
this Act, a schedule of rates, regulations, and practices, including 
limitations of liability for cargo loss or damage, pertaining

[[Page 112 STAT. 1908]]

to receiving, delivering, handling, or storing property at its marine 
terminal. Any such schedule made available to the public shall be 
enforceable by an appropriate court as an implied contract without proof 
of actual knowledge of its provisions.''.
    (f) Automated Tariff System Requirements; Form.--Section 8 of that 
Act <<NOTE: 46 USC app. 1707.>> is amended by adding at the end the 
following:

    ``(g) Regulations.--The Commission shall by regulation prescribe the 
requirements for the accessibility and accuracy of automated tariff 
systems established under this section. The Commission may, after 
periodic review, prohibit the use of any automated tariff system that 
fails to meet the requirements established under this section. The 
Commission may not require a common carrier to provide a remote terminal 
for access under subsection (a)(2). 
The <<NOTE: Publication.>> Commission shall by regulation prescribe the 
form and manner in which marine terminal operator schedules authorized 
by this section shall be published.''.

SEC. 107. AUTOMATED TARIFF FILING AND INFORMATION SYSTEM.

    Section 502 of the High Seas Driftnet Fisheries Enforcement Act (46 
U.S.C. App. 1707a) is repealed.

SEC. 108. CONTROLLED CARRIERS.

    Section 9 of the Shipping Act of 1984 (46 U.S.C. App. 1708) is 
amended by--
            (1) striking ``service contracts filed with the Commission'' 
        in the first sentence of subsection (a) and inserting ``service 
        contracts, or charge or assess rates,'';
            (2) striking ``or maintain'' in the first sentence of 
        subsection (a) and inserting ``maintain, or enforce'';
            (3) striking ``disapprove'' in the third sentence of 
        subsection (a) and inserting ``prohibit the publication or use 
        of''; and
            (4) striking ``filed by a controlled carrier that have been 
        rejected, suspended, or disapproved by the Commission'' in the 
        last sentence of subsection (a) and inserting ``that have been 
        suspended or prohibited by the Commission'';
            (5) striking ``may take into account appropriate factors 
        including, but not limited to, whether--'' in subsection (b) and 
        inserting ``shall take into account whether the rates or charges 
        which have been published or assessed or which would result from 
        the pertinent classifications, rules, or regulations are below a 
        level which is fully compensatory to the controlled carrier 
        based upon that carrier's actual costs or upon its constructive 
        costs. For purposes of the preceding sentence, the term 
        `constructive costs' means the costs of another carrier, other 
        than a controlled carrier, operating similar vessels and 
        equipment in the same or a similar trade. The Commission may 
        also take into account other appropriate factors, including but 
        not limited to, whether--'';
            (6) striking paragraph (1) of subsection (b) and 
        redesignating paragraphs (2), (3), and (4) as paragraphs (1), 
        (2), and (3), respectively;
            (7) striking ``filed'' in paragraph (1) as redesignated and 
        inserting ``published or assessed'';
            (8) striking ``filing with the Commission.'' in subsection 
        (c) and inserting ``publication.'';
            (9) <<NOTE: Deadline.>> striking ``Disapproval of Rates.--'' 
        in subsection (d) and inserting ``Prohibition of Rates.--Within 
        120 days after the receipt of information requested by the 
        Commission under

[[Page 112 STAT. 1909]]

        this section, the Commission shall determine whether the rates, 
        charges, classifications, rules, or regulations of a controlled 
        carrier may be unjust and unreasonable.'';
            (10) striking ``filed'' in subsection (d) and inserting 
        ``published or assessed'';
            (11) striking ``may issue'' in subsection (d) and inserting 
        ``shall issue'';
            (12) striking ``disapproved.'' in subsection (d) and 
        inserting ``prohibited.'';
            (13) striking ``60'' in subsection (d) and inserting ``30'';
            (14) inserting ``controlled'' after ``affected'' in 
        subsection (d);
            (15) striking ``file'' in subsection (d) and inserting 
        ``publish'';
            (16) striking ``disapproval'' in subsection (e) and 
        inserting ``prohibition'';
            (17) inserting ``or'' after the semicolon in subsection 
        (f)(1);
            (18) striking paragraphs (2), (3), and (4) of subsection 
        (f); and
            (19) redesignating paragraph (5) of subsection (f) as 
        paragraph (2).

SEC. 109. PROHIBITED ACTS.

    (a) Section 10(b) of the Shipping Act of 1984 (46 U.S.C. App. 
1709(b)) is amended by--
            (1) striking paragraphs (1) through (3);
            (2) redesignating paragraph (4) as paragraph (1);
            (3) inserting after paragraph (1), as redesignated, the 
        following:
            ``(2) provide service in the liner trade that--
                    ``(A) is not in accordance with the rates, charges, 
                classifications, rules, and practices contained in a 
                tariff published or a service contract entered into 
                under section 8 of this Act unless excepted or exempted 
                under section 8(a)(1) or 16 of this Act; or
                    ``(B) is under a tariff or service contract which 
                has been suspended or prohibited by the Commission under 
                section 9 of this Act or the Foreign Shipping Practices 
                Act of 1988 (46 U.S.C. App. 1710a);'';
            (4) redesignating paragraphs (5) and (6) as paragraphs (3) 
        and (4), respectively;
            (5) striking ``except for service contracts,'' in paragraph 
        (4), as redesignated, and inserting ``for service pursuant to a 
        tariff,'';
            (6) striking ``rates;'' in paragraph (4)(A), as 
        redesignated, and inserting ``rates or charges;'';
            (7) inserting after paragraph (4), as redesignated, the 
        following:
            ``(5) for service pursuant to a service contract, engage in 
        any unfair or unjustly discriminatory practice in the matter of 
        rates or charges with respect to any port;'';
            (8) redesignating paragraphs (7) and (8) as paragraphs (6) 
        and (7), respectively;
            (9) striking paragraph (6) as redesignated and inserting the 
        following:
            ``(6) use a vessel or vessels in a particular trade for the 
        purpose of excluding, preventing, or reducing competition by 
        driving another ocean common carrier out of that trade;'';

[[Page 112 STAT. 1910]]

            (10) striking paragraphs (9) through (13) and inserting the 
        following:
            ``(8) for service pursuant to a tariff, give any undue or 
        unreasonable preference or advantage or impose any undue or 
        unreasonable prejudice or disadvantage;
            ``(9) for service pursuant to a service contract, give any 
        undue or unreasonable preference or advantage or impose any 
        undue or unreasonable prejudice or disadvantage with respect to 
        any port;
            ``(10) unreasonably refuse to deal or negotiate;'';
            (11) redesignating paragraphs (14), (15), and (16) as 
        paragraphs (11), (12), and (13), respectively;
            (12) striking ``a non-vessel-operating common carrier'' in 
        paragraphs (11) and (12) as redesignated and inserting ``an 
        ocean transportation intermediary'';
            (13) striking ``sections 8 and 23'' in paragraphs (11) and 
        (12) as redesignated and inserting ``sections 8 and 19'';
            (14) striking ``or in which an ocean transportation 
        intermediary is listed as an affiliate'' in paragraph (12), as 
        redesignated;
            (15) striking ``Act;'' in paragraph (12), as redesignated, 
        and inserting ``Act, or with an affiliate of such ocean 
        transportation intermediary;''
            (16) striking ``paragraph (16)'' in the matter appearing 
        after paragraph (13), as redesignated, and inserting ``paragraph 
        (13)''; and
            (17) inserting ``the Commission,'' after ``United States,'' 
        in such matter.

    (b) Section 10(c) of the Shipping Act of 1984 (46 U.S.C. App. 
1709(c)) is amended by--
            (1) striking ``non-ocean carriers'' in paragraph (4) and 
        inserting ``non-ocean carriers, unless such negotiations and any 
        resulting agreements are not in violation of the antitrust laws 
        and are consistent with the purposes of this Act'';
            (2) striking ``freight forwarder'' in paragraph (5) and 
        inserting ``transportation intermediary, as defined by section 
        3(17)(A) of this Act,'';
            (3) striking ``or'' at the end of paragraph (5);
            (4) striking ``contract.'' in paragraph (6) and inserting 
        ``contract;''; and
            (5) adding at the end the following:
            ``(7) for service pursuant to a service contract, engage in 
        any unjustly discriminatory practice in the matter of rates or 
        charges with respect to any locality, port, or persons due to 
        those persons' status as shippers' associations or ocean 
        transportation intermediaries; or
            ``(8) for service pursuant to a service contract, give any 
        undue or unreasonable preference or advantage or impose any 
        undue or unreasonable prejudice or disadvantage with respect to 
        any locality, port, or persons due to those persons' status as 
        shippers' associations or ocean transportation 
        intermediaries;''.

    (c) Section 10(d) of the Shipping Act of 1984 (46 U.S.C. App. 
1709(d)) is amended by--
            (1) striking ``freight forwarders,'' and inserting 
        ``transportation intermediaries,'';

[[Page 112 STAT. 1911]]

            (2) striking ``freight forwarder,'' in paragraph (1) and 
        inserting ``transportation intermediary,'';
            (3) striking ``subsection (b)(11), (12), and (16)'' and 
        inserting ``subsections (b)(10) and (13)''; and
            (4) adding at the end thereof the following:
            ``(4) No marine terminal operator may give any undue or 
        unreasonable preference or advantage or impose any undue or 
        unreasonable prejudice or disadvantage with respect to any 
        person.
            ``(5) The prohibition in subsection (b)(13) of this section 
        applies to ocean transportation intermediaries, as defined by 
        section 3(17)(A) of this Act.''.
SEC. 110. COMPLAINTS, INVESTIGATIONS, REPORTS, AND REPARATIONS.

    Section 11(g) of the Shipping Act of 1984 (46 U.S.C. App. 1710(g)) 
is amended by--
            (1) striking ``section 10(b)(5) or (7)'' and inserting 
        ``section 10(b)(3) or (6)''; and
            (2) striking ``section 10(b)(6)(A) or (B)'' and inserting 
        ``section 10(b)(4)(A) or (B).''.

SEC. 111. FOREIGN SHIPPING PRACTICES ACT OF 1988.

    Section 10002 of the Foreign Shipping Practices Act of 1988 (46 
U.S.C. App. 1710a) is amended by--
            (1) striking `` `non-vessel-operating common carrier','' in 
        subsection (a)(1) and inserting `` `ocean transportation 
        intermediary','';
            (2) striking ``forwarding and'' in subsection (a)(4);
            (3) striking ``non-vessel-operating common carrier'' in 
        subsection (a)(4) and inserting ``ocean transportation 
        intermediary services and'';
            (4) striking ``freight forwarder,'' in subsections (c)(1) 
        and (d)(1) and inserting ``transportation intermediary,'';
            (5) striking ``filed with the Commission,'' in subsection 
        (e)(1)(B) and inserting ``and service contracts,'';
            (6) inserting ``and service contracts'' after ``tariffs'' 
        the second place it appears in subsection (e)(1)(B); and
            (7) striking ``(b)(5)'' each place it appears in subsection 
        (h) and inserting ``(b)(6)''.

SEC. 112. PENALTIES.

    (a) Section 13(a) of the Shipping Act of 1984 (46 U.S.C. App. 
1712(a)) is amended by adding at the end thereof the following: ``The 
amount of any penalty imposed upon a common carrier under this 
subsection shall constitute a lien upon the vessels operated by that 
common carrier and any such vessel may be libeled therefore in the 
district court of the United States for the district in which it may be 
found.''.
    (b) Section 13(b) of the Shipping Act of 1984 (46 U.S.C. App. 
1712(b)) is amended by--
            (1) striking ``section 10(b)(1), (2), (3), (4), or (8)'' in 
        paragraph (1) and inserting ``section 10(b)(1), (2), or (7)'';
            (2) by redesignating paragraphs (4), (5), and (6) as 
        paragraphs (5), (6), and (7), respectively;
            (3) inserting before paragraph (5), as redesignated, the 
        following:

[[Page 112 STAT. 1912]]

            ``(4) If the Commission finds, after notice and an 
        opportunity for a hearing, that a common carrier has failed to 
        supply information ordered to be produced or compelled by 
        subpoena under section 12 of this Act, the Commission may 
        request that the Secretary of the Treasury refuse or revoke any 
        clearance required for a vessel operated by that common carrier. 
        Upon request by the Commission, the Secretary of the Treasury 
        shall, with respect to the vessel concerned, refuse or revoke 
        any clearance required by section 4197 of the Revised Statutes 
        of the United States (46 U.S.C. App. 91).''; and
            (4) striking ``paragraphs (1), (2), and (3)'' in paragraph 
        (6), as redesignated, and inserting ``paragraphs (1), (2), (3), 
        and (4)''.

    (c) Section 13(f)(1) of the Shipping Act of 1984 (46 U.S.C. App. 
1712(f)(1)) is amended by--
            (1) striking ``or (b)(4)'' and inserting ``or (b)(2)'';
            (2) striking ``(b)(1), (4)'' and inserting ``(b)(1), (2)''; 
        and
            (3) adding at the end thereof the following ``Neither the 
        Commission nor any court shall order any person to pay the 
        difference between the amount billed and agreed upon in writing 
        with a common carrier or its agent and the amount set forth in 
        any tariff or service contract by that common carrier for the 
        transportation service provided.''.

SEC. 113. REPORTS AND CERTIFICATES.

    Section 15 of the Shipping Act of 1984 (46 U.S.C. App. 1714) is 
amended by--
            (1) striking ``and certificates'' in the section heading;
            (2) striking ``(a) Reports.--'' in the subsection heading 
        for subsection (a); and
            (3) striking subsection (b).

SEC. 114. EXEMPTIONS.

    Section 16 of the Shipping Act of 1984 (46 U.S.C. App. 1715) is 
amended by striking ``substantially impair effective regulation by the 
Commission, be unjustly discriminatory, result in a substantial 
reduction in competition, or be detrimental to commerce.'' and inserting 
``result in substantial reduction in competition or be detrimental to 
commerce.''.

SEC. 115. AGENCY REPORTS AND ADVISORY COMMISSION.

    Section 18 of the Shipping Act of 1984 (46 U.S.C. App. 1717) is 
repealed.

SEC. 116. OCEAN FREIGHT FORWARDERS.

    Section 19 of the Shipping Act of 1984 (46 U.S.C. App. 1718) is 
amended by--
            (1) striking ``freight forwarders'' in the section caption 
        and inserting ``transportation intermediaries'';
            (2) striking subsection (a) and inserting the following:

    ``(a) License.--No person in the United States may act as an ocean 
transportation intermediary unless that person holds a license issued by 
the Commission. The Commission shall issue an intermediary's license to 
any person that the Commission determines to be qualified by experience 
and character to act as an ocean transportation intermediary.'';
            (3) redesignating subsections (b), (c), and (d) as 
        subsections (c), (d), and (e), respectively;

[[Page 112 STAT. 1913]]

            (4) inserting after subsection (a) the following:

    ``(b) Financial Responsibility.--
            ``(1) No person may act as an ocean transportation 
        intermediary unless that person furnishes a bond, proof of 
        insurance, or other surety in a form and amount determined by 
        the Commission to insure financial responsibility that is issued 
        by a surety company found acceptable by the Secretary of the 
        Treasury.
            ``(2) A bond, insurance, or other surety obtained pursuant 
        to this section--
                    ``(A) shall be available to pay any order for 
                reparation issued pursuant to section 11 or 14 of this 
                Act, or any penalty assessed pursuant to section 13 of 
                this Act;
                    ``(B) may be available to pay any claim against an 
                ocean transportation intermediary arising from its 
                transportation-related activities described in section 
                3(17) of this Act with the consent of the insured ocean 
                transportation intermediary and subject to review by the 
                surety company, or when the claim is deemed valid by the 
                surety company after the ocean transportation 
                intermediary has failed to respond to adequate notice to 
                address the validity of the claim; and
                    ``(C) shall be available to pay any judgment for 
                damages against an ocean transportation intermediary 
                arising from its transportation-related activities under 
                section 3(17) of this Act, provided the claimant has 
                first attempted to resolve the claim pursuant to 
                subparagraph (B) of this paragraph and the claim has not 
                been resolved within a reasonable period of time.
            ``(3) <<NOTE: Regulations.>> The Commission shall prescribe 
        regulations for the purpose of protecting the interests of 
        claimants, ocean transportation intermediaries, and surety 
        companies with respect to the process of pursuing claims against 
        ocean transportation intermediary bonds, insurance, or sureties 
        through court judgments. The regulations shall provide that a 
        judgment for monetary damages may not be enforced except to the 
        extent that the damages claimed arise from the transportation-
        related activities of the insured ocean transportation 
        intermediary, as defined by the Commission.
            ``(4) An ocean transportation intermediary not domiciled in 
        the United States shall designate a resident agent in the United 
        States for receipt of service of judicial and administrative 
        process, including subpoenas.'';
            (5) striking, each place such term appears--
                    (A) ``freight forwarder'' and inserting 
                ``transportation intermediary'';
                    (B) ``a forwarder's'' and inserting ``an 
                intermediary's'';
                    (C) ``forwarder'' and inserting ``intermediary''; 
                and
                    (D) ``forwarding'' and inserting ``intermediary'';
            (6) striking ``a bond in accordance with subsection 
        (a)(2).'' in subsection (c), as redesignated, and inserting ``a 
        bond, proof of insurance, or other surety in accordance with 
        subsection (b)(1).'';
            (7) striking ``Forwarders.--''  in the caption of subsection 
        (e), as redesignated, and inserting ``Intermediaries.--'';
            (8) striking ``intermediary'' the first place it appears in 
        subsection (e)(1), as redesignated and as amended by paragraph

[[Page 112 STAT. 1914]]

        (5)(A), and inserting ``intermediary, as defined in section 
        3(17)(A) of this Act,'';
            (9) striking ``license'' in paragraph (1) of subsection (e), 
        as redesignated, and inserting ``license, if required by 
        subsection (a),'';
            (10) striking paragraph (3) of subsection (e), as 
        redesignated, and redesignating paragraph (4) as paragraph (3); 
        and
            (11) adding at the end of subsection (e), as redesignated, 
        the following:
            ``(4) No conference or group of 2 or more ocean common 
        carriers in the foreign commerce of the United States that is 
        authorized to agree upon the level of compensation paid to an 
        ocean transportation intermediary, as defined in section 
        3(17)(A) of this Act, may--
                    ``(A) deny to any member of the conference or group 
                the right, upon notice of not more than 5 calendar days, 
                to take independent action on any level of compensation 
                paid to an ocean transportation intermediary, as so 
                defined; or
                    ``(B) agree to limit the payment of compensation to 
                an ocean transportation intermediary, as so defined, to 
                less than 1.25 percent of the aggregate of all rates and 
                charges which are applicable under a tariff and which 
                are assessed against the cargo on which the intermediary 
                services are provided.''.
SEC. 117. CONTRACTS, AGREEMENTS, AND LICENSES UNDER PRIOR SHIPPING 
                        LEGISLATION.

    Section 20 of the Shipping Act of 1984 (46 U.S.C. App. 1719) is 
amended by--
            (1) striking subsection (d) and inserting the following:

    ``(d) Effects on Certain Agreements and Contracts.--All agreements, 
contracts, modifications, licenses, and exemptions previously issued, 
approved, or effective under the Shipping Act, 1916, or the Shipping Act 
of 1984, shall continue in force and effect as if issued or effective 
under this Act, as amended by the Ocean Shipping Reform Act of 1998, and 
all new agreements, contracts, and modifications to existing, pending, 
or new contracts or agreements shall be considered under this Act, as 
amended by the Ocean Shipping Reform Act of 1998.'';
            (2) inserting the following at the end of subsection (e):
            ``(3) The Ocean Shipping Reform Act of 1998 shall not affect 
        any suit--
                    ``(A) filed before the effective date of that Act; 
                or
                    ``(B) with respect to claims arising out of conduct 
                engaged in before the effective date of that Act filed 
                within 1 year after the effective date of that Act.
            ``(4) <<NOTE: Regulations.>> Regulations issued by the 
        Federal Maritime Commission shall remain in force and effect 
        where not inconsistent with this Act, as amended by the Ocean 
        Shipping Reform Act of 1998.''.

SEC. 118. SURETY FOR NON-VESSEL-OPERATING COMMON CARRIERS.

    Section 23 of the Shipping Act of 1984 (46 U.S.C. App. 1721) is 
repealed.

[[Page 112 STAT. 1915]]

   TITLE II--AUTHORIZATION OF APPROPRIATIONS FOR THE FEDERAL MARITIME 
                               COMMISSION

SEC. 201. AUTHORIZATION OF APPROPRIATIONS FOR FISCAL YEAR 1998.

    There are authorized to be appropriated to the Federal Maritime 
Commission, $15,000,000 for fiscal year 1998.

SEC. 202. FEDERAL MARITIME COMMISSION ORGANIZATION.

    Section 102(d) of Reorganization Plan No. 7 of 1961 (75 Stat. 
840) <<NOTE: 5 USC app; 46 USC app. 1111 note.>> is amended to read as 
follows:

    ``(d) A vacancy or vacancies in the membership of Commission shall 
not impair the power of the Commission to execute its functions. The 
affirmative vote of a majority of the members serving on the Commission 
is required to dispose of any matter before the Commission.''.

SEC. 203. REGULATIONS. <<NOTE: Deadline. 46 USC app. 1716 note.>> 

    Not later than March 1, 1999, the Federal Maritime Commission shall 
prescribe final regulations to implement the changes made by this Act.

        TITLE III--AMENDMENTS TO OTHER SHIPPING AND MARITIME LAWS

SEC. 301. AMENDMENTS TO SECTION 19 OF THE MERCHANT MARINE ACT, 
                        1920.

    (a) In General.--Section 19 of the Merchant Marine Act, 1920 (46 
U.S.C. App. 876) is amended by--
            (1) striking ``forwarding and'' in subsection (1)(b);
            (2) striking ``non-vessel-operating common carrier 
        operations,'' in subsection (1)(b) and inserting ``ocean 
        transportation intermediary services and operations,'';
            (3) striking ``methods or practices'' and inserting 
        ``methods, pricing practices, or other practices'' in subsection 
        (1)(b);
            (4) striking ``tariffs of a common carrier'' in subsection 
        7(d) and inserting ``tariffs and service contracts of a common 
        carrier'';
            (5) striking ``use the tariffs of conferences'' in 
        subsections (7)(d) and (9)(b) and inserting ``use tariffs of 
        conferences and service contracts of agreements'';
            (6) striking ``tariffs filed with the Commission'' in 
        subsection (9)(b) and inserting ``tariffs and service 
        contracts'';
            (7) striking ``freight forwarder,'' each place it appears 
        and inserting ``transportation intermediary,''; and
            (8) striking ``tariff'' each place it appears in subsection 
        (11) and inserting ``tariff or service contract''.

    (b) Stylistic Conformity.--Section 19 of the Merchant Marine Act, 
1920 (46 U.S.C. App. 876), as amended by subsection (a), is further 
amended by--
            (1) redesignating subdivisions (1) through (12) as 
        subsections (a) through (l), respectively;

[[Page 112 STAT. 1916]]

            (2) redesignating subdivisions (a), (b), and (c) of 
        subsection (a), as redesignated, as paragraphs (1), (2), and 
        (3);
            (3) redesignating subdivisions (a) through (d) of subsection 
        (f), as redesignated, as paragraphs (1) through (4), 
        respectively;
            (4) redesignating subdivisions (a) through (e) of subsection 
        (g), as redesignated, as paragraphs (1) through (5), 
        respectively;
            (5) redesignating clauses (i) and (ii) of subsection (g)(4), 
        as redesignated, as subparagraphs (A) and (B), respectively;
            (6) redesignating subdivisions (a) through (e) of subsection 
        (i), as redesignated, as paragraphs (1) through (5), 
        respectively;
            (7) redesignating subdivisions (a) and (b) of subsection 
        (j), as redesignated, as paragraphs (1) and (2), respectively;
            (8) striking ``subdivision (c) of paragraph (1)'' in 
        subsection (c), as redesignated, and inserting ``subsection 
        (a)(3)'';
            (9) striking ``paragraph (2)'' in subsection (c), as 
        redesignated, and inserting ``subsection (b)'';
            (10) striking ``paragraph (1)(b)'' each place it appears and 
        inserting ``subsection (a)(2)'';
            (11) striking ``subdivision (b),'' in subsection (g)(4), as 
        redesignated, and inserting ``paragraph (2),'';
            (12) striking ``paragraph (9)(d)'' in subsection (j)(1), as 
        redesignated, and inserting ``subsection (i)(4)''; and
            (13) striking ``paragraph (7)(d) or (9)(b)'' in subsection 
        (k), as redesignated, and inserting ``subsection (g)(4) or 
        (i)(2)''.

SEC. 302. TECHNICAL CORRECTIONS.

    (a) Public Law 89-777.--Sections 2 and 3 of the Act of November 6, 
1966 (46 U.S.C. App. 817d and 817e) are amended by striking ``they in 
their discretion'' each place it appears and inserting ``it in its 
discretion''.
    (b) Tariff Act of 1930.--Section 641(i) of the Tariff Act of 1930 
(19 U.S.C. 1641) is repealed.

            TITLE IV--CERTAIN LOAN GUARANTEES AND COMMITMENTS

SEC. 401. CERTAIN LOAN GUARANTEES AND COMMITMENTS. <<NOTE: 46 USC app. 
            1273a.>> 

    (a) The Secretary of Transportation may not issue a guarantee or 
commitment to guarantee a loan for the construction, reconstruction, or 
reconditioning of a liner vessel under the authority of title XI of the 
Merchant Marine Act, 1936 (46 U.S.C. App. 1271 et seq.) after the date 
of enactment of this Act unless the Chairman of the Federal Maritime 
Commission certifies that the operator of such vessel--
            (1) has not been found by the Commission to have violated 
        section 19 of the Merchant Marine Act, 1920 (46 U.S.C. App. 
        876), or the Foreign Shipping Practices Act of 1988 (46 U.S.C. 
        App. 1701a), within the previous 5 years; and
            (2) has not been found by the Commission to have committed a 
        violation of the Shipping Act of 1984 (46 U.S.C. App. 1701 et 
        seq.), which involves unjust or unfair discriminatory treatment 
        or undue or unreasonable prejudice or disadvantage with respect 
        to a United States shipper, ocean transportation intermediary, 
        ocean common carrier, or port within the previous 5 years.

[[Page 112 STAT. 1917]]

    (b) The Secretary of Commerce may not issue a guarantee or a 
commitment to guarantee a loan for the construction, reconstruction, or 
reconditioning of a fishing vessel under the authority of title XI of 
the Merchant Marine Act, 1936 (46 U.S.C. App. 1271 et seq.) if the 
fishing vessel operator has been--
            (1) held liable or liable in rem for a civil penalty 
        pursuant to section 308 of the Magnuson-Stevens Fishery 
        Conservation and Management Act (16 U.S.C. 1858) and not paid 
        the penalty;
            (2) found guilty of an offense pursuant to section 309 of 
        the Magnuson-Stevens Fishery Conservation and Management Act (16 
        U.S.C. 1859) and not paid the assessed fine or served the 
        assessed sentence;
            (3) held liable for a civil or criminal penalty pursuant to 
        section 105 of the Marine Mammal Protection Act of 1972 (16 
        U.S.C. 1375) and not paid the assessed fine or served the 
        assessed sentence; or
            (4) held liable for a civil penalty by the Coast Guard 
        pursuant to title 33 or 46, United States Code, and not paid the 
        assessed fine.

    Approved October 14, 1998.

LEGISLATIVE HISTORY--S. 414:
---------------------------------------------------------------------------

SENATE REPORTS: No. 105-61 (Comm. on Commerce, Science, and 
Transportation).
CONGRESSIONAL RECORD, Vol. 144 (1998):
            Apr. 3, 21, considered and passed Senate.
            Aug. 4, considered and passed House, amended.
            Oct. 1, Senate concurred in House amendment.

                                  <all>