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Commission Issues Release Re: People Republic of China

March 12, 2002

FEDERAL MARITIME COMMISSION

FEDERAL MARITIME COMMISSION ISSUES NOTICE OF INQUIRY
ON RESTRICTIVE SHIPPING PRACTICES
IN PEOPLE'S REPUBLIC OF CHINA

Washington, D.C. 20573

NR 02-04

CONTACT BRYANT L. VANBRAKLE, SECRETARY
(202) 523-5725

FOR RELEASE: March 12, 2002

Federal Maritime Commission Chairman Harold J. Creel, Jr., announced today that the Commission has issued a Notice of Inquiry seeking information and comments from the public concerning the effects of a recently promulgated Decree of the People's Republic of China ("PRC") affecting the operations of shipping companies in the U.S. foreign trade with China. The Commission, acting in the context of its existing inquiry into restrictive practices of the PRC affecting shipping in the U.S. trade with China, is requesting information that will assist it in evaluating the effects of recent changes in Chinese law. The Decree, entitled "Regulations of the PRC on the International Maritime Transportation," was promulgated by the State Council of the PRC on December 5, 2001, signed by Prime Minister Zhu Rong Ji, published on December 21, 2001, and became effective January 1, 2002.

The Commission expressed concern with serious restrictions affecting the ability of: U.S. ocean transportation intermediaries, carriers and other providers of transportation services to obtain the necessary licenses and permissions to do business in China; non-Chinese vessel operators to operate or increase the number of their branch offices in China, including restrictions on the geographic area they may serve and the scope of services they may offer; vessel operators and non-vessel operating common carriers to establish rates they charge customers for carriage to and from China without filing or government approval of rate levels and with the confidentiality accorded ocean common carrier service contract rates under U.S. law.

The Commission seeks to ensure that it has the most accurate information with regard to these issues, so that it may determine whether any current Chinese laws, rules, regulations or practices merit the initiation of a proceeding under section 19 of the Merchant Marine Act, 1920 or the Foreign Shipping Practices Act of 1988. Interested persons, including shippers, ocean transportation intermediaries, vessel operators and others in the shipping industry, are invited to comment within 90 days.