16 July 2021


The US Federal Maritime Commission (FMC) and the Antitrust Division of the US Department of Justice (DoJ) signed on 12 July a Memorandum of Understanding (MoU) to foster better cooperation on enforcement of competition issues across the container shipping industry.

The MoU establishes a framework for the FMC and the DoJ to continue regular discussions and review law enforcement and regulatory matters affecting competition in the shipping industry. It also provides for information and expertise exchanges between the agencies that may be relevant and useful in meeting their oversight and enforcement responsibilities. "This memorandum between the Commission and the Department of Justice supplements and strengthens the FMC's ability to detect, address, and pursue violations of the law or anticompetitive behaviour by those we regulate," noted FMC Chair Daniel B. Maffei.

The agreement followed the issuance of an executive order by US President Joe Biden on 9 July to take action on the strained container market on which freight forwarders and shippers suffered from record-high freight rates and surcharges with ever decreasing service levels. The Biden administration recognises that the global container shipping industry has consolidated into a small number of dominant foreign-owned lines and alliances, which can disadvantage American exporters. The order aims to combat the excessive concentration of industry, the abuses of market power, and the harmful effects of monopoly and monopsony through increased antitrust enforcement, rulemaking, and cooperation within the administration. The Chair of the FMC is also encouraged to vigorously enforce the prohibition of unjust and unreasonable practices in the context of detention and demurrage pursuant to the Shipping Act and its interpretive rule, as well as consider further rulemaking to improve detention and demurrage practices and enforcement of related Shipping Act prohibitions.

Source: The White House, Federal Maritime Commission