Served 5/29/98
FEDERAL MARITIME COMMISSION
AMERICAN PRESIDENT LINES, LTD., AMERICAN PRESIDENT LINES CO. PTE. LTD, CHINA OCEAN SHIPPING, CO., EVERGREEN MARINE CORP., HANJIN SHIPPING CO., HYUNDAI MERCHANT MARINE CO., LTD., KAWASAKI KISEN KAISHA, LTD., MITSUI O.S.K. LINES, LTD., ORIENT OVERSEAS CONTAINER LINE, INC., NIPPON YUSEN KABUSHIKI KAISHA, YANGMING MARINE TRANSPORT CORP.
SECTION 15 ORDER ON ASIAN SHIPOWNERS' FORUM
The Federal Maritime Commission ("Commission"), pursuant to section 15 of the Shipping Act of 1984 ("1984 Act"), 46 U.S.C. app. 1714,(1) is requiring American President Lines, Ltd. and American President Lines, Co. Pte. Ltd. ("APL"), China Ocean Shipping Co. ("COSCO"), Evergreen Marine Corp. ("Evergreen"), Hanjin Shipping Co. ("Hanjin"), Hyundai Merchant Marine Co. Ltd. ("Hyundai"), Kawasaki Kisen Kaisha Ltd. ("K-Line"), Mitsui O.S.K. Lines, Ltd. ("Mitsui"), Orient Overseas Container Line ("OOCL"), Nippon Yusen Kabushiki Kaisha ("NYK"), and Yangming Marine Transport Corp. ("Yangming") to furnish certain information and documents pertaining to their participation in a March, 1998 meeting(s) and/or the March, 1997 meeting(s) of the Stabilization of Trade Committee of the Asian Shipowners' Forum ("ASF Stabilization Committee").
The Asian Shipowners' Forum ("ASF") is an organization of shipowners' associations from various nations whose members meet to discuss issues of common concern to Asia-based carriers, including issues of rate stabilization in the Asia/U.S. trades. In addition to full membership meetings, the ASF has five standing committees, at least one of which focuses particularly on issues related to rates, rate increases, and capacity utilization. On March 9, 1998, the ASF Stabilization Committee released a "Note Of Understanding" announcing "a mutual understanding and common recognition" among committee members on five points, including the need for rate increases in various trades (presumably including the transpacific trades), the importance of maintaining a "common ground" and shared responsibility for trade stabilization, and the "necessity" that line CEOs "observe orderly marketing/pricing in each trade lane."
The Commission is seeking this information for two principal reasons. First, the information and documents sought will assist the Commission in determining whether the activities engaged in by the Asian Shippers' Forum and the ASF Stabilization Committee are such that they should be required to file an FMC agreement, and their meetings be subject to minutes filing requirements.
Second, the Commission is concerned about the possibility that the ASF Stabilization Committee may be serving as an unmonitored forum for discussions and agreements among ocean carriers, and carrier groups, concerning collective pricing and/or collective capacity management that could affect the U.S. transpacific trades.
NOW THEREFORE, IT IS ORDERED that, pursuant to section 15 of the Shipping Act of 1984, APL, COSCO, Evergreen, Hanjin, Hyundai, K-Line, Mitsui, OOCL, NYK, and Yangming shall submit to the Commission responses to the following request for information and documents(2) on or before July 28, 1998:
For all named lines:
1. Please provide copies of any remarks, speeches, or other addresses, in your possession or control, that were made by any of the attendees at the March 1998 ASF Stabilization Committee meeting(s) in Hong Kong, and the March 1997 meeting(s) in Taipei.
2. Please provide copies of all minutes(3) in your possession or control from the March 1998 ASF Stabilization Committee meeting(s) in Hong Kong, and the March 1997 meeting(s) in Taipei.
3. Please provide copies of any agenda, reports, studies, data, talking points, policy papers, or other documents in your possession or control concerning, directly or indirectly, the transpacific liner trades, that any ASF member or any carrier or carrier organization (including conferences, discussion agreements, or carrier alliances) prepared and/or provided for use at the March 1998 or the March 1997 ASF Stabilization Committee meetings.
4. For the period October 1, 1997 through March 31, 1998, please provide copies of all documents in your possession or control, in addition to those that may have been provided in response to questions 1 through 3 above, received from other ocean carriers or carrier organizations(4) that either (a) discuss transpacific rate policies, capacity levels, capacity utilization, or changes in sailing schedules, or (b) refer to the Asian Shipowners' Forum and/or its Stabilization of Trade Committee, including, but not limited to, documents prepared or received by line officials who attended the March meeting.
For APL, MOL, Hyundai only:
5. For the period October 1, 1997 through March 31, 1998, please provide a list of dates of all New World Alliance principals' meetings and Pacific regional meetings(5) at which current and expected future transpacific rate levels, general rate increases, capacity levels, capacity utilization, or sailing schedules were discussed. Also please provide copies of minutes for each of those meetings.
6. Please provide a copy of any documents concerning current or future changes to the New World Alliance's transpacific service schedules that were shared with any carrier or organization of carriers other than New World Alliance members (including conferences, discussion agreements, other alliances, or the ASF Stabilization Committee) during the period October 1, 1997 through March 31, 1998. Please indicate with whom they were shared and the date of that communication.
For NYK and OOCL:
7. For the period October 1, 1997 through March 15, 1998, please provide a list of dates of all Grand Alliance II principals' meetings and Pacific regional meetings(6) at which current and expected future transpacific rate levels, general rate increases, capacity levels, capacity utilization, or sailing schedules were discussed. Also, please provide copies of minutes for each of those meetings.
8. Please provide a copy of any documents concerning current or future changes to Grand Alliance II's transpacific service schedules that were shared with any carrier or organization of carriers other than Grand Alliance II members (including conferences, discussion agreements, other alliances, or the ASF Stabilization Committee) during the period October 1, 1997 through March 15, 1998. Please indicate with whom they were shared, and the date of that communication.
IT IS FURTHER ORDERED, that documents provided pursuant to this order must be accompanied by a certification by an official from each carrier indicating that a thorough search has been made, and that all documents responsive to this order within the possession, custody or control of the carrier have been provided.
By the Commission.
Joseph C. Polking
Secretary
ENDNOTES
1. Section 15(a) of the 1984 Act, 46 U.S.C. app. 1714(a), provides:
REPORTS --the Commission may require any common carrier, or any officer, receiver, trustee, lessee, agent or employee thereof, to file with it any periodical or special report or any account, record, rate, or charge, or memorandum of any facts and transactions appertaining to the business of that common carrier. The report, account, record, rate, charge, or memorandum shall be furnished in the form and within the time prescribed by the Commission. Conference minutes reported to be filed under this section shall not be released to third parties or published by the Commission.
2. As used herein, the term "document(s)" refers to written, printed, typed or visually or aurally or electronically reproduced or archived material of any kind, and includes but is not limited to all copies (regardless of origin and whether or not including additional writing thereon or attached thereto) of any and all letters, correspondence, recommendations, contracts, agreements, orders, records, minutes, reports, press releases, plans, lists, memoranda, instructions, notes, notices, confirmations, inter-office communications, electronic mail messages or notes, cables, notation or memoranda of any sort of conversations, telephone calls, meetings or other communications, summaries, messages, reviews, opinions, studies and investigations, questionnaires and surveys. The term does not include bills of lading, vessel stowage plans, trucking receipts and payment records for shipments.
Any document written in a language other than English shall be accompanied by an English translation.
3. As used herein, the term "minutes" refers to both official and informal records or summaries memorializing the proceedings at the meeting of an organization, including initial, intermediate and final drafts of official summaries, and individual memorializations of meetings made by attending parties, including handwritten notes, outlines, inter-office memoranda, and personal memos-to-the-file.
4. In responding to this document request, lines that are members of conferences or discussion agreements need not provide copies of minutes of those agreement meetings which already have been filed with the FMC. Lines that are not members of a conference or discussion agreement, but may have copies of such an agreement's minutes (formal or informal) in their possession or control, should provide any such minutes in their response.
5. The Commission is not requesting documents from local operating level meetings dealing with administrative issues. The Order seeks only minutes of alliance meetings among the higher level executives responsible for major alliance policy decisions ("principals meetings") and the regional senior management meetings that provide coordination for, and/or resolve issues involving the transpacific trades ("Pacific regional meetings").
6. The Commission is not requesting documents from local operating level meetings dealing with administrative issues, just alliance meetings among the higher level executives responsible for major alliance policy decisions ("principals meetings") and the regional senior management meetings that provide coordination for, and/or resolve issues involving the transpacific trades ("Pacific regional meetings").