Commissioner William P. Doyle’s statement on the proposed Ocean Alliance Agreement

Yesterday, Commissioner William P. Doyle of the U.S. Federal Maritime Commission voted in favor of requesting additional information from “The Ocean Alliance” parties. The correct terminology is a “Request for Additional Information” otherwise known as a “RFAI.” The RFAI effectively “stops the clock” on this agreement until such time as the filing parties answer the questions proposed in the RFAI. Once those questions are answered and filed with the Commission, a new 45-day clock commences. This Ocean Alliance agreement was filed with the Commission on July 15, 2016, and would have become effective on August 29, 2016, absent Commission action. The proposed Ocean Alliance agreement consists of COSCO Container Lines Company, CMA-CGM (with APL), Evergreen Marine Corporation, and Orient Overseas Container Line (OOCL). In any event, the Ocean Alliance parties are looking to “go live” with their Alliance in or about April 2017.

Commissioner Doyle stated: “I pay special attention to competition matters especially to small businesses, downstream participants and the upstream — supplier and vendor markets. We’ve been down this road before with language proposed but not implemented by the P3 Alliance and the language in the existing 2M Alliance (Maersk and MSC). I’d like to see fair dealing and transparency in how the parties handle negotiations with third parties, suppliers, small businesses, and other service providers. Using their proposed buying power through proposed joint purchasing agreements could harm both downstream and upstream participants.”

The existing 2M Alliance Agreement provides safeguards for U.S. third-parties (including small businesses), such as marine terminal operators, stevedores, tug operators and other providers or suppliers. The 2M Parties must negotiate independently and enter into separate contracts with the third parties.

Commissioner Doyle concluded: “There is plenty of time for the Ocean Alliance parties to review and digest the questions posed by the Commission. I encourage Ocean Alliance representatives to work with FMC staff in answering the RFAI.”