FMC Chairman Plans Rulemaking Notice for Modernized NVOCC Regulations by Summer
HOLLYWOOD, Fla. -- Federal Maritime Commission Chairman Richard Lidinsky said the FMC will begin improving NVOCC regulations next month. Lidinsky spoke at the National Customs Brokers and Forwarders Association of America conference April 24, 2012. Lidinsky mentioned a recent FMC notice of inquiry seeking comments on its rules that exempt non-vessel-operating common carriers (NVOCCs) that enter service arrangements from certain tariff filing requirements of the Shipping Act of 1984.
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At the May FMC meeting, the commission will begin the process of modernizing regulations for NVOCC and Freight Forwarder licensing, registration, and proof of financial responsibility, Lidinsky said. The goal is for the Commission to issue an advance notice of rulemaking that seeks input and feedback on a wide range of issues this summer, he said.
The FMC also recently began the process of improving tariff rate publication exemption for Negotiated Rate Arrangements (NRAs) and issued a Notice of Inquiry seeking comments on ways to improve the 2005 rules for NVOCC Service Arrangements (NSAs). To improve NRAs, Lidinsky said he would like to:
- drop the requirement that an NVOCC must include notice of invocation of the NRA in its bill of lading.
- drop the requirement that NRA documentation include titles, addresses, or affiliates of the shipper representative who accepts the rate.
- tighten or drop the vague requirement that NVOCCs retain “all associated records” with their NRA documents.
Lidinsky said he hopes a majority of the Commission will agree, and that they can issue a targeted final rule to make these changes in the next few weeks. He doesn't want this regulatory relief and simplification to wait while the FMC works through proposals for deeper changes or expansions, said the chairman.
Additional options Lidinsky wants to be considered include:
- expanding the NRA exemption to foreign, unlicensed NVOCCs, with proposed conditions or procedural changes that ensure that they respond in a full and timely manner to any Commission process, document requests, or orders -- even if their country has a so-called “blocking statute.”
- expanding beyond a “rate” the terms that can be included in NRAs.
- whether to trim the NRA rule’s current prohibition on amendments so that it only applies to a particular shipment that has already been received by the NVO.
Dealing with China
Meetings and discussions with the Shanghai Shipping Exchange, the Chinese equivalent of the FMC, have been fruitful, Lidinsky said. This is the proper method to address any problems, he said, and he is pleased that this direct approach has already solved some misunderstandings and is a valuable tool for the future. The FMC and SEE have a good relationship, and Lidinsky will continue to urge them to work with us to lift burdens on NVOCCs, rather than to impose new ones, he said.