Ocean Carriers Seek Emergency Anti-Trust Immunity
March 27, 2020
Types : Alerts
On March 23, 2020, Crowley Liner Services, Seaboard Marine, and King Ocean filed an Emergency Cooperative Working Agreement with the Federal Maritime Commission (“FMC”). If approved, the Agreement would provide these carriers with a certain level of anti-trust immunity when discussing and coordinating their ocean trade businesses and operation involving U.S. coasts, Gulf coasts, the Caribbean, as well as the coasts of Central America and South America. The coordination by these carriers is based on a need to jointly respond to the coronavirus-caused economic situation and the consequential carriage operational challenges involving trade between the said US, Caribbean, and Central and South American ports.
Specifically, the Agreement would authorize the carriers to discuss the trade volumes in the said regions. The carriers would also be allowed to exchange shipping documents and to coordinate, and even modify, their respective capacities, schedules, and routes without violating anti-trust laws. The Agreement would also authorize the parties to enter into space/slot charter arrangements.
While it is unclear if other foreign carriers, or even Jones Act carriers [1], will seek similar immunity from FMC or other government authorities, this agreement, if approved, will certainly set a good precedent for ocean carriers facing similar challenges in considering similar arrangements and in seeking the necessary approval(s) from FMC.
A copy of the Emergency Cooperative Working Agreement is available here.
[1] The Jones Act requires vessels transporting cargo between contiguous U.S. ports to be built in the United States and owned, operated and manned by U.S. citizens. The law provides some commerce protection to U.S. flagged carriers, as well as feeders and barges, and limits foreign flag carriers from conducting U.S. coastal ocean carriage services.