2024-28709. Investigation Into Conditions Affecting Shipping in the Foreign Trade and Denial of Entry of Vessels Into Spanish Ports

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Federal Maritime Commission

1. [Docket No. FMC-2024-0022]

AGENCY:

Federal Maritime Commission.

ACTION:

Notice of investigation and request for comments.

SUMMARY:

The Federal Maritime Commission has initiated an investigation into reports that the Government of Spain (Spain) is creating conditions unfavorable to shipping in the foreign trade of the United States by denying entry to its ports to certain vessels, including those participating in the Maritime Security Program.

DATES:

Submit comments on or before December 26, 2024.

ADDRESSES:

You may submit comments, identified by Docket No. FMC-2024-0022, by the following method:

Federal eRulemaking Portal: Your comments must be written and in English. You may submit your comments electronically through the Federal eRulemaking Portal at www.regulations.gov. To submit comments on that site, search for Docket No. FMC-2024-0022 and follow the instructions provided.

FOR FURTHER INFORMATION CONTACT:

For questions regarding submitting comments or the treatment of any confidential information, contact David Eng, Secretary; Phone: [phone]; Email: [e-mail].

SUPPLEMENTARY INFORMATION:

I. Introduction

On November 19, 2024, the Federal Maritime Commission (Commission) was informed that Spain had denied entry to its ports to at least three vessels, including some that are participants in the United States Maritime Administration's (MARAD) Maritime Security Program (MSP). The Commission is concerned that this apparent policy of denying entry to certain vessels will create conditions unfavorable to shipping in the foreign trade, whether in a particular route or in commerce generally. Chapter 421 of U.S. Code Title 46, section 42101, authorizes the Commission to investigate and, if necessary, adopt regulations to adjust or meet such conditions. Remedies under Chapter 421 include, but are not limited to, refusal of entry to vessels of a country that is named in the Commission's regulations and fines of up to $2,304,629 per voyage. 46 U.S.C. 42106(4), 42107(1)(a); 46 CFR part 506.

II. Summary of Investigation

The Commission's statutory authority includes the mandate to monitor and evaluate conditions that affect shipping in the foreign trade of the United States. 46 U.S.C. 42101(a).^[1] Chapter 421 encourages the maintenance of a United States merchant marine for the national defense and the development of domestic and foreign commerce. 46 U.S.C. 50101(b). Under a separate statutory provision, the Commission can also investigate whether a foreign government is unduly impairing the access of a vessel documented under the laws of the United States to ocean trade between foreign ports and take any action it finds appropriate to remedy any such violation. 46 U.S.C. 41108(d).

The Commission has consistently held that its powers do not only protect United States flagged shipping, and that foreign governmental actions that are detrimental to third-flag carriers can create conditions unfavorable to shipping in the United States foreign trade within the meaning of Chapter 421. Petition of Ace Line, 19 S.R.R. 481, 482 (FMC 1979). In the past, the Commission has investigated port practices in Japan that included restrictive and discriminatory licensing practices and refusals to grant licenses to United States carriers. Port Restrictions and Requirements in the United States/Japan Trade,62 FR 9696, 9699 (March 4, 1997). The Commission has also investigated conditions created in the United States-Korea, United States-Taiwan, and United States-Venezuela trades. See Randy L. Baldemor, Comment Federal Maritime Commission Sanctions on Japanese Carriers: A Call for Fairer Methods of Resolving Disputes, 8 Pac. Rim L & Pol'y J. 109, at 116 (1999).

The Commission received information on November 19, 2024, indicating that Spain is denying entry into Spanish ports to certain vessels. Spain appears to have denied docking privileges to the Maersk Denver in early November. Maersk Line Vessel Diverts to Morocco Due to Allegations in Spain, The Maritime Executive, November 11, 2024 (available at https://maritime-executive.com/​article/​maersk-line-vessel-diverts-to-morocco-due-to- ( print page 96974) allegations-in-spain ) (last visited November 20, 2024). That vessel was owned and operated by a participant in the MARAD MSP Fleet and the vessel appears to have been receiving a retainer from MARAD in exchange for availability during times of need. See Maritime Security Program | MARAD, ( https://www.maritime.dot.gov/​national-security/​strategic-sealift/​maritime-security-program-msp ) (last visited November 20, 2024). Spain also appears to have denied entry to the Maersk Seletar, another MSP participant vessel, in early November.^[2] Though not a participant in the MSP, another vessel appears to have been refused docking privileges in May. Spain Denies Port of Call to Ship Carrying Arms to Israel, The Guardian, May 16, 2024 (available at https://www.theguardian.com/​world/​article/​2024/​may/​16/​spain-denies-port-of-call-to-ship-carrying-arms-to-israel) (last accessed November 20, 2024).

MARAD's MSP maintains a fleet of commercially viable, militarily useful merchant ships active in international trade. The MSP fleet is available to support U.S. Department of Defense (DoD) sustainment sealift requirements during times of conflict or in other national emergencies. The program also provides DoD access to MSP participants' global intermodal transportation network of terminals, facilities, logistic management services, and U.S. citizen merchant mariners.

The Commission's statutory purposes include ensuring an efficient, competitive, and economical transportation system in the United States, encouraging the development of an economically sound and efficient liner fleet capable of meeting national security needs and supporting commerce, and promoting the growth and development of United States exports through competitive and efficient carriage of goods by water. 46 U.S.C. 40101. A law or policy by a foreign government that refuses entry to vessels documented under the laws of the United States is inconsistent with the Commission's goal of ensuring access to and supporting the complex and interdependent system for the common carriage of goods by water in foreign commerce. The Commission has therefore determined that it will investigate the apparent decision by Spain to deny entry to vessels participating in MARAD's MSP, as well as its apparent decision to deny entry to other vessels.

At this initial stage of the investigation, the Commission will focus on providing a route for interested parties, including the Government of Spain and common carriers that have been denied entry into Spanish ports, to provide information, perspectives, and proposed solutions.

III. Investigation and Initial Request for Comments

The Commission has determined that the above situation meets the threshold requirements for consideration under the relevant statutory and regulatory authority. See46 U.S.C. 42101; 46 CFR part 550. The Commission therefore initiates an investigation into whether the situation has created conditions that are unfavorable to shipping in foreign trade, whether in a particular trade or on a particular route or in commerce generally. See46 U.S.C. 42101(a); 46 CFR 550.301. To that end, the Commission has designated the General Counsel to lead an investigation into the conditions and to prepare a report on the investigation's findings and recommendations for Commission consideration. The Commission has further determined to ask interested persons to submit written comments containing arguments, experiences, and/or data relevant to denials of entry into Spanish ports. In particular, the Commission seeks information about when this has occurred, the vessels that have been denied entry, and any reason or reasons given for the denial.

The Commission's jurisdiction under 46 U.S.C. 42101 is broad, and the agency welcomes comments not only from the Government of Spain, but also from container shipping interests, vessel owners, individuals and groups with relevant information on commercial considerations, and anyone else with relevant information or perspectives on this matter.

As the Commission proceeds with this investigation, it may determine to request additional comment or gather information through other means as authorized under 46 U.S.C. 40104 and 42104, and 46 CFR part 550.

By the Commission.

David Eng,

Secretary.

Footnotes

1.  The Commission may also investigate whether a foreign government or carrier's practices result in adverse impacts on United States carriers or United States oceanborne trade or creates conditions that do not exist for foreign carriers in the United States under the laws of the United States. 46 U.S. Code, Chapter 423. At this time, the Commission is not initiating an investigation pursuant to Chapter 423.

2.   See also https://www.maritime.dot.gov/​sites/​marad.dot.gov/​files/​2022-08/​MSP%20Fleet%20%208-1-2022.pdf for a list of vessels participating in the MSP.