Chairman Mario Cordero Speaks at National Industrial Transportation League (NITL)

Synopsis:

Chairman Cordero addressed the annual assembly of NITL members in New Orleans yesterday and covered three key topics.

PierPass

The Chairman reminded the audience that one of his top priorities is addressing issues surrounding PierPass. Ten years ago, the FMC authorized west coast terminal operators, under the West CoastMarine Terminal Operator Agreement, to come together to resolve congestion issues in the San Pedro Bay, and PierPass was the industry solution. PierPass promised to revolutionize the industry and solve many of the problems that were caused by both pollution and congestion. Ten years after its creation, there is a serious question as to whether PierPass is fulfilling the mission it was authorized to fulfill. Stakeholders assert that the costs have gone up, while service has gone down. The Chairman was clear that he has heard from every major stakeholder group, raising this same concern.

The Chairman stated that PierPass would be wise to conduct a third party independent audit, as he has requested several times, which he said would go a long way toward restoring lost trust. He made it clear that he intended to be relentless in his pursuit of a resolution to the existing environment of distrust and what appears to be a lack of competition, created by PierPass’s current practices.

FMC Funding

The Chairman underscored the important role that the FMC plays as the premiere regulatory agency responsible for maintaining fair and reliable practices in the $980 billion international ocean transportation industry. He emphasized that the FMC manages this task with a small but effective corps of 125 employees. As international shipping increases (up to $1 trillion in the next 10 years from China alone, according to some estimates), the FMC will need to increase its staffing levels to keep pace, and to ensure that the needs of the business community and U.S. consumer continue to be met in the most efficient manner possible. He shared his belief that the FMC is the agency best prepared to help solve existing and future problems of congestion at America’s ports, and said this will be his top priority.

Demurrage

The Chairman stated that the FMC has heard from many importers, exporters, and drayage trucking companies complaining about demurrage and detention charges that must be paid, even though they cannot access their cargo or drop it off in a timely manner, before free time expires. He reminded the industry that the Commission welcomes the submission of substantive documentation and information of unreasonable practices regarding the application of demurrage or detention. The documentation could include information related to those who pay the charges or to those who impose the charges. He referenced that complaints can be filed at the Commission that involve alleged violations of the Shipping Act.