[Federal Register Volume 75, Number 55 (Tuesday, March 23, 2010)]
[Notices]
[Pages 13761-13762]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-6339]


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FEDERAL MARITIME COMMISSION


Fact Finding Investigation No. 26; Vessel Capacity and Equipment 
Availability in the United States Export and Import Liner Trades; Order 
of Investigation

March 17, 2010.
    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 
statutory purpose of its regulation. Those purposes include a non-
discriminatory regulatory process, an efficient and economic 
transportation system, and promotion of the growth and development of 
U.S. exports. 46 U.S.C. 40101.
    Like many sectors of the global economy, in 2009 shippers and ocean 
carriers experienced one of the worst years in the more than fifty-year 
history of international containerized shipping.

[[Page 13762]]

During this economic downturn, U.S. liner exports fell by 14 percent 
and imports fell by 16 percent. Freight rates dropped precipitously, 
and carriers laid up more than 500 vessels worldwide, or roughly 10 
percent of the global fleet capacity.
    Reflecting the worldwide uptick in economic activity during the 
fourth quarter of 2009 and early 2010, cargo volumes shipped to the 
United States from Asia have increased, as has the demand for export 
shipments from the United States. As a result, shipping rates have 
increased. Many ships remain idle, however, and the Commission has 
received a growing number of reports that importers and exporters have 
had difficulty obtaining vessel space, particularly in the U.S.-Asia 
trades. The Commission has also received reports of U.S. exporters 
experiencing problems with the distribution and availability of 
shipping containers for their goods on those same Asian trades.
    On January 27, 2010, the President launched a National Export 
Initiative with the goal of doubling U.S. exports over the next five 
years. On March 11, 2010, the President issued Executive Order No. 
13534 and has directed the use of ``every available federal resource'' 
in support of that effort.
    Recent reports of container vessel capacity and equipment 
constraints have raised concerns over both the cause of the constraints 
and whether those constraints could hinder the nascent economic 
recovery. Therefore, consistent with its statutory duty, pursuant to 46 
CFR 502.281 et seq., the Commission hereby orders a non-adjudicatory 
investigation into current conditions and practices in the U.S. liner 
trades, and into potential impediments to the flow of ocean-borne 
import and export 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 vessel and 
equipment capacity-related issues.
    Specifically, the Fact-Finding Officer (FFO) named herein is to 
develop a record on the following:
    1. Recent conditions in the U.S. export liner trades;
    2. Recent conditions in the U.S. import liner trades;
    3. Current and forecasted common practices by vessel-operating 
common carriers (VOCCs) regarding the management and allocation of 
VOCC-, shipper-, and leasing company-owned equipment for the U.S. 
import and export trades, specifically the management, supply, 
allocation and availability of containers for all U.S. export 
commodities and categories.
    4. Current practices and plans of VOCCs regarding the deployment of 
vessel capacity in the U.S. trades;
    5. Current and planned common practices relating to service 
contracting in the U.S. liner trades, specifically:
    a. The practices of VOCCs with respect to the booking of cargo 
before and after a minimum quantity commitment of a service contract 
has been met but before the term of that contract has expired;
    b. The practices of VOCCs with respect to the cancellation of cargo 
bookings;
    c. The practices of carriers and shippers with respect to the 
overbooking of cargo; and
    d. The impact of those practices on the availability of liner 
service to meet the demands of U.S. exporters and importers; and
    6. Any related conditions or practices that affect the U.S. liner 
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) 523-5715 (telephone), (202) 275-0521 
(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, 40302, 
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 current conditions in the U.S. ocean-borne common 
carrier trades, to gather facts 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 Rebecca F. Dye 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 Investigative Officer shall issue 
an interim report of findings and recommendations no later than June 
15, 2010, a final report of findings and recommendations no later than 
July 31, 2010, 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. 2010-6339 Filed 3-22-10; 8:45 am]
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