FMC Issues Notice of Proposed Rulemaking

Contact: John K. DeCrosta (202) 523-5911

Today the Federal Maritime Commission issued a Notice of Proposed Rulemaking (NPRM). The proposed rule expands flexibility and deregulates NVOCC Service Arrangements (NSAs) and Negotiated Rate Arrangements (NRAs).

The deadline for filing comments with the agency is Monday, January 29, 2018.

Proposed Changes

There are three key changes in the proposed rule:

• ending requirement for NSAs to be filed with the Commission;
• permitting NVOCCs and shippers to amend NRAs; and,
• allowing the act of booking cargo to be considered acceptance of a rate under the terms of an NRA.

The Commission also invites comments on amending the NRA rules to allow inclusion of non-economic rate terms.

NSA – Non-Vessel-Operating Common Carrier (NVOCC) Service Arrangements

An NSA is a written contract between shipper and NVOCC that contains minimum quantities, rates and defined service levels, similar to a service contract between a vessel-operating common carrier and a shipper.

NRA – Negotiated Rate Arrangements

An NRA is currently a simple agreement between a shipper and an NVOCC on the rate to be paid for particular shipments.