News
The U.S. Federal Maritime Commission (FMC) has decided to lift rate-tariff publication requirements for Non-Vessel-Operating Common Carriers (NVOCC) to reduce regulatory burdens and bring cost savings and flexibility to the shipping industry and the customers they serve.
The Commissioners meeting voted 3-1 on February 16 to issue a final rule that will relieve more than 3,300 licensed NVOCCs from the costs and burdens of publishing in tariffs the rates they charge for cargo shipments. The final rule will be issued by February 23, 2011, and NVOCCs who follow its conditions will be relieved of rate publication requirements 45 days after the rule is published in the Federal Register. According to comments filed with the Commission, this action could save each of these businesses up to $200,000 per year.
The final rule establishes an instrument called a negotiated rate arrangement. Licensed NVOCCs who enter into negotiated rate arrangements with their customers will be exempted from the requirement of publishing their rates in tariffs if they meet conditions that include:
- NVOCCs would continue to publish rules tariffs containing terms and conditions governing shipments;
- NVOCCs would be required to provide those rules to the public free of charge;
- Rates charged by NVOCCs must be agreed to and memorialized in writing by the date cargo is received for shipment; and
- NVOCCs must retain documentation of the agreed rate for a period of five years, and must make that documentation available promptly to the Commission upon request.
The final rule approved by the regulatory agency limited the exemption to U.S.-licensed NVOCCs, but commissioners in the majority said they would commence proceedings to receive public input on potential future modifications, including the possibility of extending the exemption to foreign, unlicensed NVOCCs.
