FMC Provides Clarity on Unreasonable Refusal to Deal in Vessel Space Accommodations
The Federal Maritime Commission (FMC) has recently published a final rule addressing the “Definition of Unreasonable Refusal to Deal or Negotiate with Respect to Vessel Space Accommodations.” This rule aims to establish the necessary elements for the Commission to apply specific sections of the law concerning refusals of cargo space accommodations when available and refusals of vessel space accommodations. The rule outlines the application of 46 U.S.C. 41104(a)(3) for refusals during the negotiation phase and 46 U.S.C. 41104(a)(10) for refusals during the execution stage. It clarifies that claims brought before the Commission under these sections will be reviewed and decided on a case-by-case basis, taking into account the specific facts and circumstances of each case.
The requirements set forth by the rule apply to vessel-operating common carriers (VOCC) and containerized cargo. Importantly, the rule emphasizes that not all refusals by a VOCC will constitute a violation. VOCCs are granted the opportunity to demonstrate a reasonable basis for refusing to negotiate or carry cargo, thereby avoiding a violation. The rule provides non-binding and non-exhaustive examples and considerations of unreasonable behavior that the Commission may use to evaluate allegations of violations by ocean common carriers.
In addition to these provisions, the rule mandates that VOCCs must file a confidential documented export policy annually with the FMC. This documented export policy is expected to contain key information on pricing strategies, services offered, equipment provision strategies, and descriptions of markets served.
It’s important to note that the rule will take effect 60 days from its publication in the Federal Register. However, the requirements for ocean common carriers to file the documented export policy with the Commission are delayed pending approval of the Collection of Information by the Office of Management and Budget. The Commission has committed to informing the public of the effective date of these requirements upon approval.
In essence, the FMC’s final rule on unreasonable refusal to deal provides clarity on the evaluation of refusals and negotiations in the context of vessel space accommodations. This move aims to ensure fairness and transparency in maritime trade and encourages responsible conduct among carriers operating in the industry.
Source article: https://www.fmc.gov/articles/fmc-publishes-final-rule-on-unreasonable-refusal-to-deal/#:~:text=The%20rule%20establishes%20non%2Dbinding,policy%20annually%20with%20the%20Commission
Forced Labor with emphasis on Supply Chain Tracing
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