FMC Commissioner Doyle on P3 Final Decision

By Eric Haun
Thursday, June 19, 2014
FMC Commissioner William P. Doyle

U.S. Federal Maritime Commissioner William P. Doyle issued the following statement regarding China’s decision on the proposed P3 Network:

The People’s Republic of China has rejected the P3 Vessel Network Sharing Alliance based on the competition concerns in the Asia-Europe shipping market. The U.S. Federal Maritime Commission had the responsibility to review the P3 Parties’ submission for their vessel network sharing alliance on the Trans-Pacific and Trans-Atlantic trade routes. The Commission did not have jurisdiction over the Asia-Europe service route; therefore, the FMC did not issue a decision with respect to that route.

Based on the Commission’s review, the proposed P3 Network would have average trade shares of 23 percent in the Asia/North America trade and 23 percent in the Europe/North America trade. The Commission sought and received from the P3 Parties amended language that would protect small businesses, marine terminal operators, bunker operators, tugs and other small businesses and third parties. Thus, the P3 Parties would be required to negotiate independently and enter into separate contracts with the third parties. In addition, the P3 agreement activities would be subject to a special monitoring program intended to provide an early warning system to detect capacity issues and market problems.

Based on all available information, the Ministry of Commerce of the People’s Republic of China held fast to a 30 percent market share threshold for controlling a trade route. In its review, China’s Ministry of Commerce found that the P3 Network would control up to 47 percent of the container business on the Asia-Europe service route. Thus, China rejected the container shipping alliance proposal based on their competition concerns in the Asia-Europe shipping market.


The Federal Maritime Commission (FMC) noted the decision announced by its Chinese regulatory counterpart, the Ministry of Commerce (MOFCOM), with regard to the P3 Network Vessel Sharing Agreement. The agreement between A. P. Moller-Maersk A/S, CMA CGM S.A., and MSC Mediterranean Shipping Company, S.A. would have authorized 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.

In March 2014, the FMC concluded extensive review of the Trans-Pacific and Trans-Atlantic effects of the P3 Agreement and determined that the agreement was not likely at that 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. P3 Agreement parties would have been subject to specifically tailored monitoring reports to ensure compliance with the Shipping Act once the agreement became operational. The Commission’s decision remains in effect absent a withdrawal of the agreement by the parties.

"Ocean carrier vessel space alliances offer the potential benefit of cost savings and environmental efficiencies that come from coordinated deployment of newer, larger vessels. The FMC, in evaluating such agreements, will continue to balance those benefits with the potential harm from a concentration of decision-making power in terms of port coverage, sailing schedules, and necessary trade lane capacity," stated Chairman Cordero.

fmc.gov
 

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter April 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Chevron Suffers Loss, Plans Job Cuts

Chevron Corp. reported a first-quarter loss as slumping oil prices continued to drag down revenue. The company said that it is "on target" to lay off a total of 8000 workers by the end of 2016,

China COSCO to be First through the Expanded Panama Canal

China COSCO Shipping has won the draw for its container vessel Andronikos to make the ceremonial first transit through the Expanded Panama Canal during the waterway’s inauguration on Sunday, June 26.

Sellick Equipment to Open New Facility

On April, 20, 2016, at the young age of 97 years, Walter Sellick along with sons Howard Sellick - President, David Sellick - Vice President and grandson Colin Sellick - Systems Manager,

News

Italian Ship Rescues 26 Migrants off Libya

An Italian merchant ship rescued 26 migrants off the coast of Libya in rough seas and others were feared missing, the Coast Guard said on Saturday. The Coast

Symphony Sun’ Launched in Leer

On Friday the 29th of April, Nb. 420 was launched in Leer. She was christened ‘Symphony Sun’ and is the fourth vessel in a series of 6 that will be delivered to Symphony Shipping.

ACR to Debut Pathfinder PRO SART at OTC

An important addition to any commercial vessel’s survival gear kit, the Pathfinder PRO SART is introduced by ACR Electronics, Inc. at this year’s OTC. The new search

People in the News

Italian Ship Rescues 26 Migrants off Libya

An Italian merchant ship rescued 26 migrants off the coast of Libya in rough seas and others were feared missing, the Coast Guard said on Saturday. The Coast

ACR to Debut Pathfinder PRO SART at OTC

An important addition to any commercial vessel’s survival gear kit, the Pathfinder PRO SART is introduced by ACR Electronics, Inc. at this year’s OTC. The new search

Great Lakes Inks M.E., N.C. Coastal Protection Project Deals

Great Lakes Announces $55 Million in Subcontract Work in the Middle East and Award of $38 Million for a Domestic Coastal Protection Project Great Lakes Dredge

Government Update

Holland America Line Kicks off Seattle's Record Cruise Season

The Port of Seattle begins the 2016 cruise season welcoming the first ship call, Holland America Cruise Line’s Nieuw Amsterdam. Larger vessels and more cruises

MARAD: $5 Mln Available for Marine Highway Projects

The Maritime Administration (MARAD) has announced the availability of $5 million in Federal funding to expand marine highway service by creating new or expanding

Pacific Nations Take a Stand on Shipping Emissions

On Earth Day, Pacific leaders queued among 175 countries to sign the Paris Agreement in New York. Earlier that day in London, the International Maritime Organization (IMO),

Logistics

Shipping Industry Flying On The Dragon’s Back

As the many Greek players in the shipping industry know well, the legend of Icarus tells us the dangers of flying too high. Merchant vessel earnings eventually

Panama Canal Dismisses ITF Claims

The Panama Canal has dismisses claims by the International Transport Workers’ Federation (ITF) that questions industry standards and the operation of the Expanded Panama Canal’s new locks.

Shipping, Key Ingredient of EU’s Africa Agenda

The African economy has become one of the most promising global growth markets. Shipping is taking care of the largest part of international trade and in Africa

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Security Maritime Standards Offshore Oil Port Authority Salvage Shipbuilding / Vessel Construction Sonar Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1407 sec (7 req/sec)