News
At its meeting last week, the U.S. Federal Maritime Commission (FMC) voted unanimously to move forward with a recommendation by the Container Freight Index and Derivatives Working Group to initiate a rulemaking to give more leeway for ocean carriers and shippers to use service contracts with rates linked to freight rate indices. To date, the regulatory agency has received more than fifty service contracts that reference freight indices.
Under the current rules, service contracts can only reference outside terms, such as a rate in a freight index, that are contained in a publication widely available to the public and well-known within the industry. The proposed rule change would allow contracts to reference freight indices or other outside terms, so long as they are ''readily available to the parties and the Commission.'' As a result, ocean carriers and their customers will be able to use freight index rates in their contracts free of questions over whether those indices are ''widely available to the public'' or ''well known.''
