[Federal Register Volume 75, Number 124 (Tuesday, June 29, 2010)]
[Notices]
[Pages 37435-37436]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-15724]
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FEDERAL MARITIME COMMISSION
Fact Finding Investigation No. 27; Potentially Unlawful, Unfair
or Deceptive Ocean Transportation Practices Related to the Movement of
Household Goods or Personal Property in U.S.-Foreign Oceanborne Trades;
Order of Investigation
Pursuant to the Shipping Act of 1984, 46 U.S.C. 40101 et seq.
(``Shipping Act''), the Federal Maritime Commission (``FMC'' or
``Commission'') is charged with regulating the common carriage of goods
by water in the foreign commerce of the United States (``liner
service''). In doing so, the Commission must be mindful of the purpose
of its regulation, which includes protecting the public from unlawful,
unfair or deceptive ocean transportation practices and resolving
shipping disputes in the movement of cargo in U.S.-foreign oceanborne
trades.
Each year, the Commission receives a substantial number of
complaints from individuals that have experienced various problems with
their international household goods or personal property shipments.
Between 2005 and 2009, the Commission received over 2,500 consumer
complaints related to household goods moving companies transporting
household goods or personal property between various locations in the
United States and foreign destinations. Many of those complaints are
filed by individuals who are first-time or very occasional users of
international shipping services. This issue is a serious and
substantial consumer protection problem within the Commission's area of
responsibility.
Typical complaints allege failure to deliver the cargo and refusal
to return the pre-paid ocean freight; loss of the cargo; significant
delay in delivery; charges to the shipper for marine insurance that was
never obtained; misinformation as to the whereabouts of the cargo;
significantly inflated charges after the cargo was tendered and threats
to withhold the shipment unless the increased freight was paid; or
failure to pay the common carrier engaged by the company as another
intermediary. In many cases, a shipper has been forced to pay another
carrier or warehouse a
[[Page 37436]]
second time in order to have the cargo released.
Individuals and companies have held themselves out to perform ocean
transportation to the public and accepted responsibility for the
transportation of these shipments without obtaining an Ocean
Transportation Intermediary (``OTI'') license and providing required
proof of financial responsibility to the FMC. In many cases, these
individuals and corporations operate without publishing a tariff
showing its rates and charges, and do not observe just and reasonable
regulations and practices relating to or connected with receiving,
handling, storing or delivering property.
Section 19 of the Shipping Act of 1984 (``the Act''), 46 U.S.C.
40901(a), prohibits any person from providing OTI services prior to
being issued a license from the Commission and obtaining a bond, proof
of insurance or other surety in a form and amount determined by the
Commission to ensure financial responsibility. An OTI is defined as
either a freight forwarder or a non-vessel-operating common carrier
(``NVOCC''). 46 U.S.C. 40102(19). Any person operating as an NVOCC in
the United States must provide evidence of financial responsibility in
the amount of $75,000. 46 CFR 515.21(a)(2).
Furthermore, section 8(a) of the Act, 46 U.S.C. 40501(a), requires
NVOCCs to maintain tariffs showing their rates, charges,
classifications and practices. These tariffs must be open to the public
for inspection in an automated tariff system. The Commission's
regulations at 46 C.F.R. Sec. 520.3 affirm this statutory requirement
by directing each NVOCC to notify the Commission, prior to providing
transportation services, of the location of its tariffs, as well as the
publisher used to maintain those tariffs by filing a Form FMC-1.
Section 10(b)(11) of the Act, 46 U.S.C. 41104(11), prohibits a common
carrier from knowingly and willfully accepting cargo from or
transporting cargo for the account of an OTI that does not have a
tariff or a bond (an NVOCC). Finally, under section 10(d)(1), no common
carrier or ocean transportation intermediary may fail to establish,
observe, and enforce just and reasonable regulations and practices
relating to or connected with receiving, handling, storing or
delivering property. 46 U.S.C. 41102(c).
Therefore, consistent with its statutory duty, the Commission
hereby orders a non-adjudicatory investigation to develop a record of
the nature, scope and frequency of potentially unlawful, unfair or
deceptive ocean transportation practices by household goods movers in
the movement of cargo in U.S.-foreign oceanborne trades.
The Commission will use the information obtained in this
investigation and recommendations of the Fact-Finding Officer (``FFO'')
to determine its policies with respect to compliance, consumer
protection, and enforcement issues.
Specifically, the FFO named herein is to develop a record on the
following:
The nature and scope of the problem presented by potentially unfair,
unlawful or deceptive practices in the shipping of household goods
or personal property in U.S.-foreign oceanborne trades.
The FFO is to report to the Commission within the time specified
herein, with recommendations for any further Commission action,
including any policies, rulemaking proceedings, or other actions
warranted by the factual record developed in this proceeding.
Interested persons are invited and encouraged to contact the FFO
named herein, at (202) 523-5712 (telephone), (202) 275-0522
(facsimile), or by e-mail at [email protected], should they wish to
provide testimony or evidence, or to contribute in any other manner to
the development of a complete factual record in this proceeding.
Therefore, it is ordered, That, pursuant to 46 U.S.C. 41302, 40502
to 40503, 41101 to 41109, 41301 to 41309, and 40104, and 46 CFR 502.281
to 502.291, a non-adjudicatory investigation is hereby instituted into
the nature, scope and frequency of potentially unlawful, unfair or
deceptive ocean transportation practices related to the carriage of
household goods or personal property in the oceanborne foreign commerce
of the United States, in order to gather facts and establish a record
related to the issues set forth above and to provide a basis for any
subsequent action by the Commission;
It is further ordered, That, pursuant to 46 CFR 502.284 and 502.25,
Commissioner Michael A. Khouri is designated as the FFO. The FFO shall
have, pursuant to 46 CFR 502.281 to 502.291, full authority to hold
public or non-public sessions, to resort to all compulsory process
authorized by law (including the issuance of subpoenas ad testifacandum
and duces tecum), to administer oaths, to require reports, and to
perform such other duties as may be necessary in accordance with the
laws of the United States and the regulations of the Commission. The
FFO shall be assisted by staff members as may be assigned by the
Commission's Managing Director, and the FFO is authorized to delegate
any authority enumerated herein to any assigned staff member as the FFO
determines to be necessary.
It is further ordered, That the FFO shall issue an interim report
of findings and recommendations no later than November 15, 2010, a
final report of findings and recommendations no later than February 15,
2011, and provide further interim reports if it appears that more
immediate Commission action is necessary, such reports to remain
confidential unless and until the Commission provides otherwise;
It is further ordered, That this proceeding shall be discontinued
upon acceptance of the final report of findings and recommendations by
the Commission, unless otherwise ordered by the Commission; and
It is futher ordered, That notice of this Order be published in the
Federal Register.
By the Commission.
Karen V. Gregory,
Secretary.
[FR Doc. 2010-15724 Filed 6-28-10; 8:45 am]
BILLING CODE 6730-01-P