FMC seeks to address port and supply chain issues

The meeting came a week after the Commission established a new audit program, dubbed “Vessel-Operating Common Carrier Audit Program”, and set up a dedicated audit team to monitor compliance with FMC’s rules on detention and demurrage by the largest carriers. At the open meeting, major topics were the ongoing port and supply chain congestion.

A key part of the July 28 meeting was the presentation of interim recommendations under “Fact Finding No. 29”- an FMC initiative dating from March 2020- shortly after the onset of pandemic-related disruptions, including blanked sailings - under the direction of Commissioner Rebecca Dye to look carefully at supply chain issues related to liner shipping.  

Commissioner Dye’s presentation included suggestions on minimizing barriers to actions by shippers and truckers to filing complaints with the FMC as well as increasing the amount of potential reparations awards. The recommendation noted that: “Despite criticism of carrier and terminal practices since Fact Finding No. 29 was initiated, few private parties have filed complaints seeking reparations.”  

The possible broadening of “anti-retaliation” provisions in the relevant sections of the US Code - Chapter 411 of Title 46 of the United States Code - so that shippers could file complaints would need to carefully monitor the  conduct of the carriers, for example, refusing shipments from a cargo interest making a complaint to the FMC and seeking monetary awards from the carriers.   The recommendations also included suggestions on providing information to the cargo community on the complaint process- through enhancements to the FMC’s website and through outreach in the form of webinars.  

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Commissioner Dye, who has stressed dialogue with and participation of supply chain participants “plans to hold meetings of Supply Chain Innovation Teams in Memphis and the Port of Los Angeles to address supply chain disruptions and increase supply chain visibility,” according to the FMC.

Memphis, on the Mississippi River, is at the locus of all the leading trans-continental railways handling cargo sent eastward from the West Coast.  The Commissioner noted in a statement: “We are working with the FMC Memphis Supply Chain Team to improve freight fluidity in the Memphis railyards, in cooperation with the Chairman and the leadership of the Surface Transportation Board.” The latter is an agency that oversees the US railways, which have been largely de-regulated since the early 1980s.

Los Angeles, on the West Coast, has been plagued by delays, with resultant complaints, as vessels inbound from Asia have overwhelmed the landside terminal infrastructure. 

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Commissioner Dye also informed that: “I’ve been approached by the Port of Los Angeles to explore how the data they collect in their port information system can aid in enforcing demurrage and detention and in addressing other supply chain dislocations, including earliest return date and container return. This is an exciting opportunity to not only benefit Commission enforcement generally, but also to illustrate the immense benefits of visibility to supply chain performance.”