Federal Maritime CommissionInitiatives and Partnerships

October 10, 2014

Jennifer M. Gartlan

Office of Consumer Affairs & Dispute Resolution

Services

Topics Discussed

• Federal Maritime Commission (“FMC”) Household Goods (“HHG”) Jurisdiction

• Licensing Requirements for International Movers

• Strategic Use of CADRS Services to Help Prevent and Resolve Challenges and Disputes

• FMC Port Congestion Initiative

• FMC Governmental and Private Partnerships

FMC HHG Jurisdiction

FMC HHG Jurisdiction

• Statutes and Regulations Applicable to International Movers:

• Shipping Act of 1984, as amended

• 46 CFR Part 500

• Jurisdiction: Shipments of HHGs that travel between the US and foreign destinations via ocean (including intermodal transportation)

HHG Jurisdiction

• FMC does not exercise jurisdiction over military or GSA HHG shipments

• FMC does not have criminal jurisdiction

• FMC does not have jurisdiction over:

• Air shipments

• Maritime shipments between the U.S. and another U.S. state or territory (e.g. Puerto Rico to NY, CA to HI – STB Jurisdiction)

• US interstate truck shipments (FMCSA and STB spilt jurisdiction)

FMC Ocean Transportation Intermediary (OTI) Licensing Requirements

OTI Licenses

• 2 Types of OTI Licenses:

• Ocean Freight Forwarder (OFF)

• Non-Vessel Operating Common Carrier (NVOCC)

• Can hold both types of licenses simultaneously

FMC OTI License Required

• Any entity in the US that provides OFF or NVOCC services

• Foreign based NVOCCs are not required to obtain a license, but must file an FMC-1 and FMC 65 and hold a $150k bond. Must renew registration every 3 years.

OFF vs. NVOCC Services

OFF NVOCC

• Ordering cargo to port

• Preparing/processing export declarations

• Booking, arranging for or confirming cargo space

• Preparing/processing delivery orders or dock receipts

• Preparing/processing bills of lading

• Preparing/processing consular documents/arranging for certification

• Purchasing transportation services from ocean carriers and offering resale to shippers

• Payment of port-to-port or multimodal transportation charges

• Entering affreightment agreements with underlying shippers

OFF vs. NVOCC Services (cont’d.)

OFF NVOCC

• Handling freight or other monies advanced by shippers, or remitting or advancing freight or other monies or credit in connection with dispatching shipments

• Coordinating the movement of shipments from origin to vessel

• Advising exporters re: LOCs, licenses, inspections, etc.

• Leasing containers

• Entering into arrangements with origin or destination agents

Comparing OFFs vs. NVOCCs

OFF

• Not a common carrier

• Serves as an agent to the shipper

• Does not issue a House Bill of Lading

• Must identify the shipper on Master Bill of Lading:

• John Doe is listed as the shipper

• “FF as agent for John Doe”

NVOCC

• Common carrier status under FMC regulations

• Serves as a shipper to the ocean common carrier

• Serves as carrier to its shipper customer(s)

• Normally listed as the shipper on the vessel operator’s Master Bill of Lading

Comparing NVOCCs vs. FFs

OFF NVOCC

• No tariff publication

• Can receive broker compensation from VOCC

• Cannot enter into service contracts

• Cannot join shipper association

• Must publish tariff

• Must file NSAs/Retain NRAs

• Cannot receive broker compensation from

• Can enter into service contracts as shipper

• Can join shipper association

License Exceptions

• Shippers whose primary business is the sale of merchandise

• Vessel Operators that perform FF services for cargo under the their own B/L

• Ocean Freight Brokers

• Entities that exclusively transport HHGs for US military or federal civilian executive agencies

• Agents, employees or unincorporated branch offices of a licensed OTI

Obtaining an OTI License

• NVOCC:

• File FMC-18

• Obtain Bond 75k

• Publish Tariff/File FMC-1

• FF:

• File FMC-18

• Obtain Bond 50k

Licensing FAQS

New Licensing Initiatives

• Online Notification of Application

• Begins October 20, 2014

• License Applications no longer published in the Federal Register

• License Applicant notification to be provided on FMC Website: www.fmc.gov

• Notice of Proposed Rule Making

• ANPRM issued on July 18, 2013

• Comments led to Revised NPRM; Commission voted to adopt on September 25, 2014

• NPRM Published on Oct. 9, 2014. Comments due December 12, 2014

NPRM: Proposed Changes to Licensing Regulations

• Institute Online License and Registration Renewal Every 3 Years

• Requires common carriers to verify OTI licenses and registrations, tariff publication and financial responsibility provided such verifications can be made at a single location on the FMC’s website

• New expedited hearing process to address denial, revocation, and suspension of OTI licenses

• Proposal to eliminate requirement for additional $10,000 bond amount for each branch office

Strategic Use of CADRS to Prevent and Resolve Disputes

CADRS Services

• Education and Outreach

• ADR Services:

• Rapid Response and Ombuds

• Facilitation

• Mediation

• Binding Arbitration

Uses for HHG Movers

• Prevent Disputes

• Resolve Disputes with:

• Steamship Lines

• Agents

• Other HHG Movers

• Truckers

• Marine Terminal Operators

• Shipper Customers

Examples of Disputes

• Service Contract Interpretation Disputes

• General Lien Disputes

• Co-loading Challenges

• Freight and/or Surcharge Disputes

• Volume Disputes

• Moving Contract Disputes

• Space and Equipment Challenges

• Demurrage Disputes

CADRS Benefits

• Faster, Easier, Less Formal, Than Litigation

• Less Costly

• Confidential; Avoids Publicity

• Creative, Practical Solutions

• Better for On-going Relationships

• Minimize Risk

• Parties Retain Control of Outcome

• Little to Lose

Agency Congestion Initiative

Port Congestion Initiative

• Objective: Identify national trends and solutions for congestion experienced at US ports

• Action: Commissioners holding Public Forums this fall at 4 ports:

• Los Angeles, CA

• Baltimore, MD

• Charleston, SC

• New Orleans, LA

Public Port Meetings

• September 15, 2014: Port of Los Angeles – Chairman Cordero

• Port Congestion

• Truck Turn Time

• Stakeholder Impact

• Use of Technology to Reduce Congestion and Related Fees

• Pierpass

Public Port Meetings

• October 1, 2014: Port of Baltimore – Commissioners Doyle and Lidinsky• Truck Gate/Wait Times• Trucker Appointment System• “Free Time” Impacts on Gate Operations and Congestion• Ocean Carrier Arrival “Bunching” impacts port/gate

congestion• Infrastructure• Measures Taken

Upcoming Public Port Meetings

• October 30, 2014: Port of Charleston – Commissioner Khouri

• Port Congestion

• Infrastructure

• Increase Chassis Use and Efficiency

• Promote Global Trade

• Increase Supply Chain Efficiency

• November 3, 2014: Port of New Orleans – Commissioner Dye

• Port Congestion

• Promote Global Trade

• Increase Supply Chain Efficiency

Partnerships

FMC-FMCSA MOU

• Electronic Information Sharing

• Case Referrals, Joint Training/Investigations

• Collaborative Education and Outreach

• Refer consumers to FMC’s Office of Consumer Affairs & Dispute Resolution Services (CADRS)

Informal Evolving HHG Governmental Collaboration

• Surface Transportation Board (STB)

• State and Local Government Collaboration:

• States Attorney General Offices

• Local Governmental Consumer Protection Offices (e.g. Miami Dade Consumer Protection)

Partnering with Industry – Get Involved!

• IAM

• Mutual Outreach

• Consultation

• Link to Commission Website & HHG Brochure on your website: http://www.fmc.gov/news/brochures.aspx

• Participate in Port Forums: October 30 (Charleston) & November 3 (New Orleans)

• Chairman’s Earth Day Award – send nominations between October 8, 2014 – March 14, 2015

• Participate in OTI NPRM Comment Period – Comments due December 12, 2014

• Use CADRS to Prevent/Resolve Disputes and/or Training Opportunities

Questions?

Thank You!

Jennifer M. GartlanDeputy DirectorOffice of Consumer Affairs & Dispute Resolution ServicesFederal Maritime Commission(202) 688-0244 (direct)(202) 523-5807 (CADRS main)(202) 275-0059 (202-275-0059)jgartlan@fmc.govcomplaints@fmc.gov