FMC Provides New Guidance on Carrier Retaliation, Shipper Complaint Process

Unloading Containers w/ Federal Maritime Commission Seal

Trade Update • JANUARY 17, 2021

The U.S. Federal Maritime Commission recently issued new policy statements to provide guidance to shippers and others on bringing private party complaints at the commission in regards to alleged violations of the Shipping Act or regulations.

Originally proposed by Commissioner Rebecca F. Dye in recommendations made last July and adopted by the FMC in September, three policy statements were issued in late December addressing barriers that had been identified by the trade community as disincentives to filing actions at the agency.

Docket #21-13: Statement on Representative Complaints

Because an individual or small business may face challenges to bringing a private party complaint unrelated to the complaint’s merits, the FMC’s first statement “emphasizes that individuals and companies are not the only persons who may file complaints alleging violations of Title 46, Chapter 411.”

Rather, the FMC states “any person may file a complaint alleging a violation, including shippers’ associations and trade groups or trade associations.” This broad interpretation of the statute allows such organizations to protect the interests of their members while also providing shippers with a degree of separation and insulation from potential retaliation.

Docket #21-14: Statement on Attorney Fees

Responding to concerns by shippers that lack of clarity about a complainant’s liability for a respondent’s attorney fees may deter shippers from filing actions, the FMC’s second statement explains its approach to attorney fees and reiterates that a party who brings an unsuccessful complaint is not automatically required to pay the other party’s attorney fees.

In accordance with 2014 changes to the statute that made the award of fees discretionary rather than mandatory, the FMC says will favorably regard those “complainants who raise non-frivolous claims in good faith, who litigate zealously but within the rules and for proper purposes, and who comply with Commission orders.” In such cases, the FMC states that complainants “are at little risk of attorney fee liability if they are unsuccessful, absent unusual circumstances.”

Docket #21-15: Statement on Retaliation

In its third statement addressing the issue of potential retaliation by carriers — refusing, or threatening to refuse, cargo space accommodations because the shipper, for example — the FMC emphasizes that it broadly defines both who can bring a retaliation complaint, as well as the types of shipper activity that are protected under the existing retaliation prohibitions. This policy statement also addresses the proof necessary for certain complaints involving “other unfair or unjustly discriminatory methods” of retaliation.

Recent Developments

Following an audit of top vessel-operating common carriers last year, the FMC urged more than two dozen of the world’s biggest shipping lines to adopt three best practices related to when and how detention and demurrage fees are applied, as well as how to dispute the charges.

On December 30, the FMC initiated an investigation into the unreasonable charging of container detention fees by Wan Hai lines. Wan Hai is the 10th largest container shipping line in the world and the 25th largest carrier for U.S. imports.


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