A few days ago, the US Federal Maritime Commission (FMC) issued a notice that it will investigate the surcharges of eight ocean carriers - including related surcharges such as congestion surcharges related to the continued surge in freight demand.
Eight ocean carriers were asked to provide details of their congestion surcharges and any associated charges to the FMC's Enforcement Bureau. The expedited investigation requires carriers to provide evidence by August 13, 2021 that their surcharges are in compliance with the FMC's regulatory requirements.
What is US FMC?
FMC is the abbreviation of the Federal Maritime Commission. It is headquartered in Washington and has three functions: executive legislation, quasi-judicial and law enforcement. It is in charge of and supervises the maritime commercial activities mainly based on container shipping starting and ending in the United States. . Ocean carriers and brokers are regulated by it.
The role of FMC:
Manage water freight rates, charges and operations for cargo such as containers in U.S. coastal trade, foreign trade and re-export trade;
Manage the operations of the container ocean shipping industry and companies that provide container terminal handling facilities;
Approve, veto, outlaw or revise meetings and agreements between water carriers (shipping companies) in U.S. foreign trade and domestic cabotage and the contractual freight rate system they employ;
To develop regulations to address conditions that are detrimental to the U.S. shipping industry due to foreign laws or competition from foreign-flagged container ships and other freighters;
Hear allegations of various violations of maritime law and determine whether it is illegal.
How does China's NVOCC file with the US FMC
The specific reporting requirements of FMC include:
1. Tariff (public tariff) does not need to be reported to FMC, and the carrier must publish its published tariff through appropriate electronic means to ensure that anyone (including FMC) can easily inquire at any time.
2. Service contract: A written contract signed by one or more cargo owners and a single ocean common carrier or an agreement organization composed of multiple ocean common carriers in addition to the bill of lading or cargo receipt. According to the contract, the owner promises to provide a certain amount of goods or the proportion of the goods within a fixed period of time, the carrier or the carrier organization promises a certain price or price arrangement, and the agreed service level, including guaranteed space, transportation time, Port order or similar service content. The contract can also provide for the breach of contract by both parties.
3. The carrier must report the complete service contract or amendments to FMC before the goods are shipped. FMC has strict requirements on the format and content of contracts. Each contract must have an independent contract number (SC Number), and each change must have an Amendment Number arranged in sequence.
4. Except for the origin, destination, product name, minimum quantity guarantee, and contract validity period, other contract contents are kept confidential by FMC.
