[Federal Register Volume 61, Number 220 (Wednesday, November 13, 1996)]
[Proposed Rules]
[Pages 58160-58165]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-28943]
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FEDERAL MARITIME COMMISSION
46 CFR Part 586
[Docket No. 96-20]
Port Restrictions and Requirements in the United States/Japan
Trade
AGENCY: Federal Maritime Commission.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Federal Maritime Commission, in response to apparent
unfavorable conditions in the foreign oceanborne trade between the
United States and Japan, proposes the imposition of fees on liner
vessels operated by Japanese carriers calling at United States ports.
The effect of the rule will be to adjust or meet unfavorable conditions
caused by Japanese port restrictions and requirements by imposing
countervailing burdens on Japanese carriers.
DATES: Comments due on or before January 13, 1997.
ADDRESSES: Send comments (original and 15 copies) to: Joseph C.
Polking, Secretary, Federal Maritime Commission, 800 North Capitol
Street, N.W., Washington, D.C. 20573, (202) 523-5725.
FOR FURTHER INFORMATION CONTACT: Robert D. Bourgoin, General Counsel,
Federal Maritime Commission, 800 North Capitol Street, N.W.,
Washington, D.C. 20573, (202) 523-5740.
SUPPLEMENTARY INFORMATION:
Background
Information Demand Orders
On September 12, 1995, the Federal Maritime Commission
(``Commission'' or ``FMC'') issued information demand orders to
carriers in the U.S./Japan trade,1 inquiring about certain
restrictions and requirements for the use
[[Page 58161]]
of port and terminal facilities in Japan. Four issues of concern were
addressed by the information demand orders: (1) The ``prior
consultation'' system, a process of mandatory discussions and
operational approvals involving port and terminal management, unions,
and ocean carriers serving Japan; (2) restrictions on the operation of
Japanese ports on Sunday; (3) the requirement that all containerized
cargo exported from Japan be weighed and measured by harbor workers,
regardless of commercial necessity; and (4) the disposition of the
Japanese Harbor Management Fund, which was the subject of Docket No.
91-19, Actions to Address Conditions Affecting U.S. Carriers Which do
not Exist for Foreign Carriers in the U.S./Japan Trade. The Commission
observed that these practices may result in conditions unfavorable to
shipping in the United States/Japan trade, and may constitute adverse
conditions affecting U.S. carriers that do not exist for Japanese
carriers in the United States.
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\1\ NYK Line (North America) Inc.; Mitsui O.S.K. Lines
(America), Inc.; K Line America Inc.; Sea-Land Service, Inc.;
American President Line; Westwood Shipping Lines; Evergreen Line;
Hanjin Shipping Co. Ltd.; Maersk Inc.; China Ocean Shipping Co.;
Hyundai Merchant Marine; Orient Overseas Container Line (``OOCL'');
Yangming Marine Line; Neptune Orient Lines; Senator Linie (USA)
Inc.; Mexican Line (TMM); Hapag-Lloyd (America) Inc.; Zim Container;
and Cho Yang Line.
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Prior Consultation
Many of the questions in the information demand orders centered on
the prior consultation system and how it is administered by the Japan
Harbor Transportation Association (``JHTA''). JHTA is an association of
companies providing harbor transportation services, including terminal
operators, stevedores, and sworn measurers. Under this system, carriers
serving Japan must consult with JHTA about operational matters
involving Japanese ports or harbor labor. After JHTA consults with a
carrier, it may conduct consultations with labor interests, then
approve or deny the line's request.
The responses to the Commission's orders indicated that virtually
all operational plans and changes made by carriers serving Japan must
be submitted for prior consultation. These include: any changes in
berth, route, or port calls; inauguration of new services or new
vessels; the addition of extra port calls (either permanently or
temporarily), or calls by non-container ships at container berths;
jumboization of vessels or changes in vessel technology which affect
stevedoring or terminal operations; temporary assignment of vessels as
substitutes (even if only for one voyage) or the renaming of vessels;
rationalization agreements between carriers involving vessel sharing or
berthing changes; the assignment of a stevedoring contractor or
terminal operator to a carrier and any subsequent change in assignment;
requests for Sunday work; changes in mandatory weighing and measuring
arrangements; or any other changes which affect stevedoring or terminal
operations.
The comments shed light on the complex and opaque procedural
aspects of the prior consultation system. According to several
respondents, if a carrier wants to take one of the above-described
actions, it first submits a draft written request for prior
consultation outlining its proposal to JHTA. If the matter is deemed to
be important, a meeting is then scheduled for a carrier representative
to explain its request to JHTA chairman Shiroo Takashima. Often, the
carrier executive is accompanied by an official of the stevedoring
company used by that line. At this stage, the JHTA chairman may refuse
to accept the request, or require changes or impose conditions for
acceptance.
According to several respondents, if the carriers' request is
acceptable to the JHTA chairman, it is taken up at a formal ``pre-prior
consultation'' meeting. These meetings, generally held monthly, are
attended by the JHTA chairman, vice-chairman, secretary, prior
consultation administrator, a representative from the carrier, and
often a representative of its affected stevedore or terminal operator.
If the request is accepted at this stage, the matter is deliberated at
formal prior consultation meetings between JHTA and union officials,
both in Tokyo and at the local level. Carrier representatives do not
attend the JHTA-union meetings.
A number of respondents suggested that the final prior consultation
meetings are simply formalities. It appears that if a carrier's request
is unacceptable to JHTA, this is conveyed early in the process, often
in the carrier's initial meeting with the JHTA chairman. If JHTA takes
an unfavorable view of a request, there is no formal rejection;
instead, it simply is not accepted for consideration at the formal
prior consultation meetings. In contrast, if a request has been
accepted by the JHTA chairman, it is almost assured to be approved at
the formal meetings.
Beyond the above-described procedures, JHTA's decision-making
process in prior consultation appears to be characterized by a total
lack of transparency. The respondents indicated that there are almost
no written rules, either substantive or procedural, nor are there
written reasons for decisions or an appeal process; JHTA appears to
have absolute discretion over the terms and conditions imposed in the
prior consultation process.
Many respondents suggested that JHTA uses prior consultation to
prevent competition and maintain an agreed-upon allocation of work
among the JHTA member companies. Several carriers recounted instances
where prior consultation requests were held up until the carriers
agreed to take on additional, unnecessary stevedoring companies or
contractors. A number of carriers observed that JHTA may require that,
when carriers consolidate terminal operations, the benefitting
stevedore must reach an agreement with the losing one to take on some
of the latter's workers, thereby insuring that there is still income
passing to the losing stevedoring company. These practices, according
to a number of commenters, prevent any real competition and undermine
attempts to increase the efficiency of port operations, with the result
that Japan has port costs that far exceed those of its Asian neighbors
and other major trading nations.
Much of JHTA's ability to compel participation in prior
consultation appears to stem from its relationship with, and support
of, organized labor. Some respondents explained that, if they did not
participate in prior consultation or comply with JHTA's requests, they
would be subject to retaliation, such as work stoppages or labor
disruptions. Some respondents recounted an instance in 1985 when JHTA,
in response to an investigation by the Japanese Fair Trade Commission
(``FTC''), announced that it was abandoning the carrier-JHTA component
of the prior consultation system. When the now-defunct Yamashita
Shiminon Kaisha Line attempted to go ahead with changes in its
operations, two of its vessels reportedly were boycotted by the unions,
on the grounds that there had been no prior consultation. In order to
prevent any further disruptions, respondents stated, carriers had no
choice but to request that JHTA reestablish its prior consultation
system.
Japanese Government Oversight
Respondents confirmed that the agency with direct authority over
harbor services is the Ministry of Transport (``MOT''). Persons wishing
to perform harbor transportation services must obtain a license from
MOT, in accordance with the Port Transportation Business Law. Also,
under the Law Establishing the Ministry of Transportation, MOT is
invested with authority over, inter alia, the development, improvement
and coordination of the harbor transportation business. MOT reportedly
can give oversight or guidance relating to the conduct of the Prior
Consultation System if a national
[[Page 58162]]
policy (i.e., the development, improvement and coordination of the
harbor transport business) is sought to be furthered. Respondents also
indicated that administrative guidance, or gyoseishido, is practiced by
governmental bodies in Japan, to secure cooperation of affected parties
to further an administrative purpose.2
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\2\ The Commission in its information demand orders described
further authority that MOT apparently maintains under the Port
Transportation Business Law. For example, MOT reviews rates based on
whether they are reasonable and non-discriminatory. Art. 9. MOT must
approve operators' ``terms and conditions on port transportation,''
to determine that ``there is no fear that the terms and conditions
may impede the benefits of users,'' and also approve any changes in
operators' business plans. Art. 11 & 17. If MOT determines that the
port transportation businesses ``impede benefits of users'' it may
order changes in business plans, terms and conditions, or rates.
Art. 21.
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MOT appears to have given guidance or otherwise become involved
with prior consultation on at least a few occasions. In 1986, MOT
signed, as a witness, the Letter of Confirmation on New Prior
Consultation, an agreement between JHTA and carriers establishing the
current version of the system. More recently, in 1992, MOT reportedly
issued a ministerial view to JHTA and the Japanese Shipowners Ports
Council setting forth basic principles for prior consultation regarding
container terminal disputes.3 In that document (a translation of
which was provided by respondents), MOT directed that, if carriers make
changes to their operations, these changes must be submitted for prior
consultation. It was also stated in the Ministerial View that if a
shipping company changes the consortium with which it is affiliated, or
reorganizes its service, it will give explanations to JHTA and obtain
its understanding as early as possible. While the Ministerial View was
addressed specifically to the Japanese shipowners, it appears that its
principles are applied uniformly to all shipping companies.
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\3\ The Japanese Shipowners Ports Council (``JSPC'') is the
component of the Japanese Shipowners' Association that deals
directly with harbor service-related matters. JSPC often served as
the voice of the Japanese lines in prior consultation and other
dealings with JHTA. There is a similar association for non-Japanese
shipowners operating in Japan, the Japan Foreign Steamship
Association (``JFSA'').
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JHTA's operations also fall within the jurisdiction of the Japanese
Fair Trade Commission (``FTC''). The Japanese respondents explained
that Article 8 of the Law Relating to the Prohibition of Private
Monopoly and Methods of Preserving Fair Trade of Japan (``Antimonopoly
Law'') prohibits trade associations from engaging in certain
activities, including restricting competition, limiting the number of
entrepreneurs, restricting unduly the activities of constituent
entrepreneurs, and causing entrepreneurs to engage in unfair business
practices. As the agency responsible for administering the Antimonopoly
Law, the FTC has the authority to investigate JHTA and its activities.
This FTC authority has been invoked on occasion. In June, 1985, a
complaint was filed with the Fair Trade Commission against JHTA,
reportedly alleging that JHTA was restricting the activities of
carriers and the competition among terminal operators. However,
respondents stated that the complaint was later withdrawn and the FTC
suspended its investigation.
Another FTC complaint was filed late last year. Apparently, a
dispute erupted between JHTA and one of its members, Sankyu, Inc.
Sankyu filed a complaint with the FTC, alleging that JHTA was violating
Japanese antitrust laws, allocating work among operators. In response,
according to published reports, JHTA began exerting considerable
pressure on one of Sankyu's clients, OOCL. JHTA reportedly refused to
permit prior consultation and approve the carrier's space sharing and
terminal reorganization plans. In February, according to press reports
and other sources, Sankyu acquiesced to JHTA pressure and withdrew its
FTC complaint. While the FTC has not formally dismissed or terminated
its investigation, it does not appear to have taken any further action
in this area since Sankyu's withdrawal.
Mandatory Weighing and Measuring
The respondents uniformly confirmed that mandatory weight and
measure data for all cargo is not required for any administrative
functions or documentary procedures in Japan, nor do carriers require
measurement of export box load cargo. Some carriers stated that they
have attempted unsuccessfully to refuse sworn measurement services and
charges; however, JHTA and union representatives threatened work
delays, stoppages, and other retaliation if these efforts continued.
The majority of carriers have not attempted unilaterally to stop
weighing and measuring. Estimates of per-container weighing and
measuring costs ranged from $41 to $85 per TEU, with the majority of
responses in the $60-$68 range.
In December, 1995, and January, 1996, agreements were reached
involving JHTA, the sworn measurement companies, and JSPC and JFSA (the
Japanese and foreign carrier groups), to phase out mandatory weighing
and measuring over the course of five years. Reportedly, under the plan
agreed to by the parties, carriers will be required to make a lump-sum
payment to the sworn measurers each year from 1996 to 2000. The
payments will be based on the amount paid for weighing and measuring in
1994. The lump sum payments for the five years will be 83.3%, 66.6%,
49.9%, 33.2%, and 16.5% of the 1994 total.
Sunday Work
Because the earthquake that struck the Kobe region in January,
1995, disabled most of that port's facilities, the volume of cargo
moving through other Japanese ports increased substantially. According
to several of the respondents, harbor workers immediately began
operating on Sundays on an emergency basis to accommodate the
additional capacity. In May, 1995, a one-year agreement reportedly was
reached between JHTA and the unions to keep Sunday work in place in
Japan's six major ports (Tokyo, Yokohama, Nagoya, Osaka, Kobe, and
Kanmon).
The one-year agreement (the text of which was provided by several
respondents) has several requirements and restrictions for Sunday work.
For example, Sunday work is limited to the moving of containers between
vessels and the carriers container yards. Therefore, cargo cannot
arrive at the gate on Sunday for loading that day, and cargo discharged
on Sunday cannot be released the same day to the consignee. Also, the
agreement provides that receipt of cargo on Saturdays should be
minimized as much as possible, as Saturday is a day off for most harbor
workers. Vessels may be loaded and unloaded on Sundays only between
8:30 a.m. and 4:30 p.m.
According to the text of the agreement, a shipping company wishing
to work on Sunday must apply by the preceding Friday. An additional
charge is imposed for Sunday work. Sunday work is limited to shipping
companies that ``have fully implemented the MOT approved rates and
charges.'' Sunday work is also limited to carriers that ``have observed
the harbor industrial labor/management agreement'' concerning numbers
of hours and days that union laborers may work and amount of overtime
available.
The current restrictions on Sunday work apparently have had a
number of negative effects on the respondent carriers. Some pointed out
that restrictions on moving cargo into or out of the container yard
causes inefficiency and leads to gate congestion on
[[Page 58163]]
Saturday and Monday. Several noted that Sunday work surcharges result
in extra costs. Also, respondents noted that the requirement that lines
apply in advance for Sunday work, and the shortened working hours, can
be a burden and pose planning problems.
It appears that the uncertainty surrounding the one-year agreement
has also discouraged carriers from taking full advantage of Sunday
work. While more than half of the respondents indicated that they have
used Sunday work on occasion, virtually all of this use has been to
accommodate vessel delays or other exigencies. No respondent indicated
that it changed sailing schedules to use Sunday work on a regular
basis. Apparently, since a permanent shift in vessel schedules would be
complex and costly for an individual carrier, its alliance partners,
and its feeder services, carriers cannot switch to regular Sunday calls
without guarantees that Sunday work will continue to be available.
While it appears that Sunday work will continue to be provided for
the near term, there has been no discernable progress in reaching a
stable and permanent resolution of the Sunday work issue. The previous
one-year agreement for Sunday work expired in June 1996, and was
extended for one-month intervals for July and August. It has been
reported recently that JHTA and waterfront unions have reached an
agreement by which Sunday work would be continued for six months,
through March 10, 1997. However, beyond the March 10 deadline, the fate
of Sunday work appears uncertain.
Discussion
JHTA Dominance Through the Prior Consultation System
Of all the issues raised in the Commission's information demand
order, it is apparent that prior consultation is the most serious. The
prior consultation system is central to JHTA's dominance of the harbor
services market in Japan, as it is the mechanism by which JHTA
exercises control over the activities of individual carriers and
stevedoring companies. Other JHTA restrictions, such as those affecting
Sunday work and mandatory weighing and measuring, are also of serious
concern to the Commission; however, it appears that these matters are
symptoms rather than root causes of JHTA's dominant position.
By serving as intermediary in all negotiations and requiring, on
threat of labor disruption, that carriers submit virtually all planned
operational changes for approval, JHTA is able to assign and allocate
work among its member companies. This process is used to eliminate
competition among terminal operators and stevedores, obviating the need
for them to operate more efficiently, reorganize, downsize, or
otherwise cut costs to gain market share. It also puts JHTA in a
position to block any carrier initiatives to reduce terminal costs,
such as plans by various carrier alliances to share terminals and
reduce the number of stevedoring companies used, until plans are made
to protect the harbor workers' competitive status quo.
JHTA has pushed prior consultation far beyond its purported use as
a labor relations device. As numerous respondents pointed out,
virtually every operational change by a carrier, even those with no
apparent labor impact, must be submitted to JHTA. This all-encompassing
scope of prior consultation has given JHTA broad leverage to implement
programs that benefit its constituents. It can, for example, extract
unwarranted payments from carriers, such as the Harbor Maintenance Fund
and the mandatory weighing and measuring fees. JHTA also appears to
have unchecked authority to punish its detractors.
JHTA has shown little regard for public accountability in its
administration of prior consultation. There are virtually no written
rules and no public records, decisions, or appeals. This lack of
transparency makes it almost impossible for government, industry, or
media critics to scrutinize the workings of the system.
The Role of the Government of Japan
Prior consultation and JHTA dominance do not, however, appear to be
an entirely private sector problem. Prior consultation and JHTA enjoy a
substantial amount of support from Japanese authorities. Under the Port
Transportation Business Law and the Law Establishing the Ministry of
Transportation, MOT has broad authority to oversee and regulate the
activities and business practices of JHTA and its members. In
exercising this authority, however, MOT officials have chosen to permit
JHTA to wield unchecked authority through the prior consultation
process, rather than requiring JHTA to be less anticompetitive, less
arbitrary, and more transparent.4
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\4\ We would also note that the FTC has repeatedly discontinued
investigations into JHTA's activities without taking measures to
curb the anticompetitive effects of JHTA's actions.
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Further Government of Japan support for prior consultation was
evinced clearly by the 1992 Ministerial View issued to carriers by MOT.
This document, on its face, mandates that carriers submit changes in
their business plans to JHTA for prior consultation. This would appear
to be an unequivocal validation and endorsement of JHTA's prior
consultation activities.
However, the most significant example of government support for
JHTA is the MOT licensing of harbor service companies. The Japanese
Port Transportation Business Law directs that, if a person seeks to
begin performing harbor services, MOT shall evaluate, inter alia,
whether the business in question ``has an appropriate plan to perform
the business,'' and whether it would ``cause port transportation supply
to be excessively over transportation demand.'' Art. 5 & 6. It appears
that MOT uses this authority to restrict entry and to shield JHTA and
its members from foreign competition. U.S. carriers have stated that
they have been shut out of the market entirely, and advised by Japanese
authorities that they should not even bother to apply because such
certificates would not be granted.
It appears that, by preventing foreign lines from providing
terminal services for themselves and by blocking new entrants from the
market, the Government of Japan virtually guarantees that JHTA's
monopoly over harbor operations will continue unabated. The licensing
requirement ensures that JHTA is insulated from pressure to reform,
either from outside competitors or new members. Carriers remain captive
in an increasingly unworkable port system, and their customers are
forced to absorb the resultant costs, which are among the highest in
the world. Moreover, the Government of Japan's licensing practices
appear blatantly discriminatory against U.S. carriers. There are no
legal restrictions on the ownership of terminal operations by Japanese
companies in the United States.
It is our conclusion that the Government of Japan's support for the
prior consultation system, through its discriminatory and restrictive
licensing requirements for persons wishing to perform harbor services,
appears to constitute conditions unfavorable to shipping in the U.S./
Japan trade. Accordingly, we are proposing the imposition of
countervailing sanctions, pursuant to section 19(1)(b) of the Merchant
Marine Act, 1920, 46 U.S.C. app. 876(1)(b) (``Section 19''). To avert
the imposition of these sanctions, we would urge the Government of
Japan to
[[Page 58164]]
afford U.S. carriers relief by making available to them all necessary
licenses, permissions, or certificates to perform, for themselves and
third parties, stevedoring and terminal operating services, or to
establish subsidiaries or related ventures to do so, as Japanese
carriers are permitted to do in the United States.
In addition, we remain concerned about the long term resolution of
the Sunday work issue. We are encouraged, however, that some progress
appears to have been made in this area, as well as with regard to
weighing and measuring. Therefore, we are not proposing sanctions in
these areas at this time. However, the Commission will continue to
monitor progress on these issues, and on the disposition of the yet
undisposed balances in the Harbor Management Fund, and will take
further remedial action if appropriate.
Section 19 authorizes and directs the Federal Maritime Commission
to
make rules and regulations affecting shipping in the foreign trade
not in conflict with law in order to adjust or meet general or
special conditions unfavorable to shipping in the foreign trade,
whether in any particular trade or upon any particular route or in
commerce generally, including intermodal movements, terminal
operations, cargo solicitations, forwarding and agency services,
non-vessel-operating common carrier operations, and other activities
and services integral to transportation systems, and which arise out
of or result from foreign laws, rules, or regulations or from
competitive methods or practices employed by owners, operators,
agents, or masters of vessels of a foreign country * * *.
The measures authorized under Section 19 include limitation of
sailings, suspension of carriers' tariffs or rights to use conference
tariffs, suspension of carriers' rights to operate under FMC-filed
terminal and other agreements, fees of up to $1,000,000 per voyage, or
any other action deemed necessary and appropriate to adjust or meet the
unfavorable condition. 46 U.S.C. app. 876(9).
After giving consideration to all available countervailing
sanctions, including limitations of sailings and suspension of carrier
tariffs or terminal or other agreements, the Commission has determined
to propose a primary remedy of a $100,000 fee, assessed on Japanese
carriers when their liner vessels enter U.S. ports. However, the
Commission specifically solicits comment on the feasibility of
additional or alternative sanctions. The Commission reserves the right
to adjust the level of the fee or add additional or alternative
sanctions at any time if the subject adverse conditions are not
remedied. In the event that the presently prescribed fees are not paid,
the Proposed Rule provides for the denial of clearance or entry to or
detention at U.S. ports.
In order to provide proper notice and a fair opportunity to respond
to the proposed action, the Commission is giving all interested parties
sixty days to file comments. Factual submissions, where relevant,
should include evidence or statistics showing commercial loss and to
the extent possible be supported by sworn documents and affidavits.
List of Subjects in 46 CFR Part 586
Cargo vessels; Exports; Foreign relations; Imports; Maritime
carriers; Penalties; Rates and fares; Tariffs.
For the reasons set forth in the preamble, the FMC proposes to
amend 46 CFR Part 586 as follows:
Therefore, pursuant to section 19(1)(b) of the Merchant Marine Act,
1920, 46 U.S.C. app. 876(1)(b), as amended, Reorganization Plan No. 7
of 1961, 75 Stat. 840, and 46 CFR Part 585, it is proposed to amend
Part 586 of Title 46 of the Code of Federal Regulations as follows:
PART 586--ACTIONS TO ADJUST OR MEET CONDITIONS UNFAVORABLE TO
SHIPPING IN THE U.S. FOREIGN TRADE
1. The authority citation for Part 586 continues to read as
follows:
Authority: 46 U.S.C. app. 876(1)(b); 46 U.S.C. app. 876(5)
through (12); 46 CFR Part 585; Reorganization Plan No. 7 of 1961, 26
FR 7315 (August 12, 1961).
2. Section 586.2 is added to read as follows:
Sec. 586.2 Conditions unfavorable to shipping in the United States/
Japan trade.
(a) Conditions unfavorable to shipping in the trade. (1) The
Federal Maritime Commission (``Commission'') has determined that the
Government of Japan has created conditions unfavorable to shipping in
the U.S.-Japan trade, by discriminatorily restricting the licensing of
persons wishing to offer harbor and terminal services in Japan.
(2) Through its discriminatory and restrictive licensing practices,
the Government of Japan has protected the dominant position of the
Japan Harbor Transportation Association (``JHTA''), an association of
Japanese waterfront employers. Benefitting from this protection and
from a lack of oversight by the Government of Japan, JHTA has virtually
eliminated competition in the Japanese harbor services market. JHTA
effectively controls competition through the use of the prior
consultation system, by which carriers are required to submit virtually
all operational plans and requests for JHTA review.
(3) JHTA has used the leverage afforded by the prior consultation
system to force carriers, inter alia, to change terminal and
stevedoring arrangements, to take on unnecessary stevedoring companies
or contractors, and to make unwarranted payments to JHTA and its
members. This has resulted in detrimental excess costs for carriers and
shippers engaged U.S.-Japan oceanborne trade.
(4) The Government of Japan has discriminated against U.S. carriers
by refusing to make licenses to perform port services available to
them. This has left U.S. carriers with no choice but to submit their
shoreside planning and operations to JHTA control. In contrast, there
are no legal restrictions on the ownership of terminal operations by
Japanese carriers in the United States.
(b) Definitions. (1) Japanese carrier means Kawasaki Kisen Kaisha,
Ltd., Mitsui O.S.K. Lines, Ltd, and Nippon Yusen Kaisha.
(2) Designated vessel means any container-carrying liner vessel
owned or operated by a Japanese carrier (or any subsidiary, related
company, or parent company thereof).
(c) Assessment of fees. A fee of one hundred thousand dollars shall
be assessed each time a designated vessel is entered in any port of the
United States from any foreign port or place.
(d) Report and payment. Each Japanese carrier, on the fifteenth day
of each month, shall file with the Secretary of the Federal Maritime
Commission a report listing each vessel for which fees were assessed
under paragraph (c) of this section during the preceding calendar
month, and the date of each vessel's entry. Each report shall be
accompanied by a cashiers check or certified check, payable to the
Federal Maritime Commission, for the full amount of the fees owed for
the month covered by the report. Each report shall be sworn to be true
and complete, under oath, by the carrier official responsible for its
execution.
(e) Refusal of clearance by the collector of customs. If any
Japanese carrier subject to this section shall fail to pay any fee or
to file any quarterly report required by paragraph (d) of this section
within the prescribed period, the Commission may request the Chief,
Carrier Rulings Branch of the U.S. Customs Service to direct the
collectors of customs at U.S. ports to refuse the clearance required by
46 U.S.C. app. section 91 to any designated vessel owned or operated by
that carrier.
[[Page 58165]]
(f) Denial of entry to or detention at United States ports by the
Secretary of Transportation. If any Japanese carrier subject to this
section shall fail to pay any fee or to file any quarterly report
required by paragraph (d) of this section within the prescribed period,
the Commission may request the Secretary of Transportation to direct
the Coast Guard to:
(1) Deny entry for purpose of oceanborne trade, of any designated
vessel owned or operated by that carrier to any port or place in the
United States or the navigable waters of the United States; or
(2) Detain that vessel at the port or place in the United States
from which it is about to depart for another port or place in the
United States. By the Commission.
Joseph C. Polking,
Secretary.
[FR Doc. 96-28943 Filed 11-12-96; 8:45 am]
BILLING CODE 6730-01-W
