FMC Rejects Proposed Agreement Among Three Japanese Carriers
The Federal Maritime Commission on May 2 rejected a proposed alliance among three Japanese steamship lines, finding it had no jurisdiction because the agreement was actually a merger, the FMC said (here). The Tripartite Agreement was filed on March 24 by Kawasaki Kisen Kaisha (K-Line), Mitsui O.S.K. Lines (MOL) and Nippon Yusen Kaisha (NYK), seeking authority to share information with each other in advance of a merger next year. “After careful consideration, the Commission determined that parties to the Tripartite Agreement were ultimately establishing a merged, new business entity and that action is among the type of agreements excluded from FMC review,” the FMC said.
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“In order to receive the benefits of a merger, one needs to first merge,” FMC Commissioner William Doyle said in a statement (here). “Under the general antitrust laws, conduct such as the sharing of competitively sensitive information or the premature combining of the parties is forbidden,” he said. Doyle also noted his opposition to a provision in the agreement allowing the three carriers to jointly negotiate with U.S. services like harbor tugs, barges and feeders. “My position is clear: I am opposed to allowing ocean common carriers to team up and use their FMC-granted limited antitrust immunity to collectively negotiate rates with U.S. maritime service providers, that have no counterbalancing FMC-granted authority to collectively bargain in return,” Doyle said.