P3 Agreement Clears FMC Regulatory Review
March 20, 2014
Contact: Karen V. Gregory, Secretary (202-523-5725)
The Federal Maritime Commission (FMC) announced today that it has concluded an extensive review of the proposed P3 Network Vessel Sharing Agreement, FMC Agreement No. 012230 including the information received from the agreement parties in response to the FMC’s request for additional information. The pending agreement between A. P. Moller-Maersk A/S, CMA CGM S.A., and MSC Mediterranean Shipping Company, S.A. would authorize the parties to share vessels and engage in related cooperative operating activities in the trades between the U.S. and Asia, North Europe, and the Mediterranean. The Commission's decision, from which Commissioner Lidinsky dissents, will allow the Agreement to become effective as scheduled on Monday, March 24, 2014.
The Commission’s decision is based on a determination that the agreement is not likely at this time, by a reduction in competition, to produce an unreasonable increase in transportation cost or an unreasonable reduction in transportation service under section 6(g) of the Shipping Act. The Commission notes that there may be circumstances that could permit the P3 Agreement parties at some point in the future, to unreasonably reduce services or unreasonably raise rates that could raise concerns under section 6(g). To address these concerns, the Commission directed staff to issue alternative reporting requirements to the P3 Agreement parties to assist the Commission in its ongoing, close monitoring of the agreement.
"The Commission’s action on the P3 Agreement takes into account the comprehensive, competitive analysis conducted by the FMC staff and comments received from shippers and other stakeholders. While the agreement is expected to produce operational efficiencies for the benefit of the U.S. consumer, the new reporting requirements specifically tailored to this agreement’s unique authority will ensure we have timely and relevant information to act quickly should it be necessary," said Chairman Cordero.
The Federal Maritime Commission is the federal agency responsible for regulating the nation’s international ocean transportation for the benefit of exporters, importers, and the American consumer. The FMC’s mission is to foster a fair, efficient, and reliable international ocean transportation system while protecting the public from unfair and deceptive practices.