2012-21009. Controlled Carriers Under the Shipping Act of 1984

August 22, 2012.

AGENCY:

Federal Maritime Commission.

ACTION:

Notice.

SUMMARY:

The Federal Maritime Commission is publishing an updated list of controlled carriers, i.e., ocean common carriers operating in U.S.-foreign trades that are owned or controlled by foreign governments. Such carriers are subject to special regulatory oversight by the Commission under the Shipping Act of 1984.

FOR FURTHER INFORMATION CONTACT:

Rebecca A. Fenneman, General Counsel, Federal Maritime Commission, 800 North Capitol Street NW., Washington, DC 20573, [phone].

SUPPLEMENTARY INFORMATION:

The Federal Maritime Commission is publishing an updated list of controlled carriers. Section 3(8) of the Shipping Act of 1984 (46 U.S.C. 40102(8)), defines a “controlled carrier” as:

An ocean common carrier that is, or whose operating assets are, directly or indirectly, owned or controlled by a government, with ownership or control by a government being deemed to exist for a carrier if—

(A) A majority of the interest in the carrier is owned or controlled in any manner by that government, an agency of that government, or a public or private person controlled by that government; or

(B) That government has the right to appoint or disapprove the appointment of a majority of the directors, the chief operating officer, or the chief executive officer of the carrier.

As required by the Shipping Act, controlled carriers are subject to special oversight by the Commission. Section 9(a) of the Shipping Act (46 U.S.C. 40701(b)), states:

The Federal Maritime Commission, at any time after notice and opportunity for a hearing, may prohibit the publication or use of a rate, charge, classification, rule, or regulation that a controlled carrier has failed to demonstrate is just and reasonable.

Congress enacted these protections to ensure that controlled carries, whose marketplace decision-making can be influenced by foreign governmental priorities or by their access to non-market sources of capital, do not engage in unreasonable below-market pricing practices which could disrupt trade or harm privately-owned shipping companies.

The controlled carrier list is not a comprehensive list of foreign-owned or -controlled ships or ship owners; rather, it is only a list of ocean common carriers that are controlled by governments. See 46 U.S.C. 40102(8). Thus, tramp operators and other non-common carriers are not included, nor are non-vessel-operating common carriers, regardless of their ownership or control.

Since the last publication of this list on May 10, 2005 (70 FR 24581), the Commission has newly classified one ocean common carrier as a controlled carrier, Hainan P O Shipping Co., Ltd. (“P O Shipping”), and removed four common carriers from the controlled carrier list: Ceylon Shipping Corporation (“Ceylon”); Compagnie Nationale Algerienne de Navigation (“CNAN”); Sinotrans Container Lines Co., Ltd. (d/b/a Sinolines) (“Sinotrans”); and The Shipping Corporation of India Ltd. (“SCI”).

Pursuant to 46 CFR 501.23, P O Shipping was classified as a controlled carrier on July 23, 2010.

As part of a general review of common carriers subject to regulation by the Commission, Ceylon was determined to be inactive as of March 20, 2012. See 76 FR 70448; FMC Docket No. 11-20 Publication of Inaccurate or Inactive Ocean Common Carrier Tariffs.

CNAN has also been removed from the list, as it no longer operates as an ocean common carrier. All CNAN tariffs in U.S.-foreign trades were cancelled effective February 24, 2011.

Sinotrans is being removed from the list, as it no longer operates as an ocean common carrier in the U.S.-foreign trades, although a related company operates as a non-vessel-operating common carriers (“NVOCC”) in the U.S.-foreign trades.

SCI is also being removed from the list as it no longer does business in the U.S.-foreign trades. All SCI tariffs in U.S.-foreign trades were cancelled effective February 21, 2011.

China Shipping Container Lines Co., Ltd. and China Shipping Container Lines (Hong Kong) Company, Ltd. are now a single organization (RPI No. 019270).

It is requested that any other information regarding possible omissions or inaccuracies in this list be provided to the Commission's Office of General Counsel. See 46 CFR 501.23. The amended list of currently classified controlled carriers and their corresponding Commission-issued Registered Persons Index numbers is set forth below:

(1) American President Lines, Ltd and APL Co., Pte. (RPI No. 000240)—Republic of Singapore;

(2) COSCO Container Lines Company, Limited (RPI No. 015614)—People's Republic of China;

(3) China Shipping Container Lines Co., Ltd and China Shipping Container Lines (Hong Kong) Co., Limited (RPI No. 019270)—People's Republic of China;

(4) Hainan P O Shipping Co., Ltd. (RPI No. 022860)—People's Republic of China.

Karen V. Gregory,

Secretary.