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August 28 2023

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Page 3 of 55 Letter from the Editor 4 Journal of Commerce | August 28, 2023 Journal of Commerce (USPS 279 – 060), ISSN 1530-7557, August 28, 2023, Volume 24, Issue No. 18. Journal of Commerce is published biweekly except the last week in December (printed 25 times per year) by JOC Group Inc., 55 Water St., 39th Floor, New York, N.Y. 10041. Subscription price: $595 a year. Periodicals postage paid at New York, N.Y., and additional mailing o ices. © All rights reserved. No portion of this publication may be copied or reprinted without written permission from the publisher. POSTMASTER: Please send address changes to Journal of Commerce, Subscription Services Department, 55 Water St., 39th Floor, New York, N.Y. 10041. Executive Editor: Mark Szakonyi 202.872.1234, Managing Editor: Benjamin Meyer 916.716.6272, Managing Editor: Kevin Saville, 212.488.4282, Senior Editors: William B. Cassidy Trucking and Domestic Transportation 202.872.1228, Bill Mongelluzzo, West Coast 562.428.5999, Eric Johnson, Technology 213.444.9326, Janet Nodar, Breakbulk and Heavy Li 251.473.2742, Greg Knowler, Europe +44.797.679.8770, Ari Ashe, Southeast Ports, Intermodal Rail 202.548.7895, Associate Editor, Northeast and Gulf: Michael Angell, 646.505.4712, Associate Editor: Teri Gri is, 919.890.5602, teri.gri Research Analyst, Project and Breakbulk Cargo: Susan Oatway, FICS, +44.7930.411659 Senior Contributor: Cathy Morrow Roberson, 732.730.2533, Data Analyst: Marcin Lejk, +44.58.741.6270, Shipper Engagement Manager, North America: Tammy Auld, 832.603.9163 Shipper Engagement Manager, Breakbulk: Diana Hamm, 832.499.7368, Senior Editor, Special Projects: Alessandra Gregory Barrett, 860.248.5238, Senior Associate Editor, Special Projects: Ariane Pepsin, 215.789.7478, Special Projects Coordinator: Amanda Hunter, 212.205.1226, Senior Designer: Sue Abt, Associate Production Manager: Denise Shoukas, Designer: Hannah Kidd, +44 203 253 2134, Sales: Cindy Cronin, Director APAC sales, 954.260.6061 Jean Gibbons, Senior Sales Executive West Coast, FL, GA sales, 706.469.7160 John Knowles, Senior Sales Executive EMEA, AU sales, +44.777.997.4677 Allyson Marek, Senior Sales Executive Northeast sales, 862.754.8012 Elaine Nosaka, Senior Sales Executive VA, NC, SC, Canada sales, 703.447.9555 Judy Welp, Senior Sales Executive Midwest, Gulf, Latin America sales, 512.284.2878 For Magazine Subscription Customer Service: 55 Water St., 39th Floor, New York, N.Y. 10041 Peter Tirschwell, Vice President-Shipping Intellience, S&P Global Chris Brooks, Executive Director-Shipping Intelligence, S&P Global Carmen Verenna, Manager, Production ©2023 Journal of Commerce — All Rights Reserved For more information, visit our website, Mark Szakonyi "The two most obvious short- comings of the [original rulemaking proposal] were the 'loophole' for carrier 'profi tability' and an apparent misun- derstanding of the practical means by which carriers have decline to carry export cargo," Peter Friedmann, execu- tive director of AgTC, wrote in a July 31 comment. "This second attempt demon- strates how serious the commission is in meeting the objectives of Congress in ORSA-22 [the Ocean Shipping Reform Act of 2022], and how diligently it con- sidered all the comments of shippers." Container lines have defended turning away cargoes and prioritizing even higher-paying imports by saying they needed to inject fl uidity to dis- rupted circulatory loops, something the repositioning of empty containers for outbound loads hampers. The FMC's change to the supplemental notice doesn't eliminate the so-called business factor but no longer allows it to be used as a sole reason for refusing to serve or deal with a shipper. "Because that was at least the impression that was given by the original rule that if it's more profi table, [refusing service] is justifi able," Friedmann told the Journal of Commerce Aug. 14. "It's now got to be considered a spectrum, if you will, of considerations, and, per- sonally, I do believe that the business element does obviously play a role." Friedmann pointed to how the most recent rulemaking proposal allows container lines to deploy extra-loaders to clear empty containers, like they did during the worst of US port congestion, and if the lines accept laden exports. The providing of a sweeper ship is an exam- ple of such a business purpose, and the supplemental rule outlines that purpose as one of many to be considered when gauging whether it was unreasonable for a carrier to refuse service. Vague language Unsurprisingly, container lines are less sanguine about the changes A CHANGE IN how the US Federal Mari- time Commission (FMC) is approaching contentious rulemaking on when a con- tainer carrier can refuse to serve shippers could signifi cantly alter the regulatory landscape by making it di cult for ship- ping lines to turn away loss-making cargo or to not honor a booking. The agency, in the latest yet-to- be-fi nalized rulemaking draft released June 14, has taken the suggestions of some agricultural exporters, along with other shippers, to forbid container lines from refusing shipments because the economics aren't justifi able. Container lines are worried about the myriad of implications for their ability to run their networks, and ultimately, when they can turn away less profi table or even loss-making bookings. The FMC's explanation of the changes isn't exactly straightforward. "Profi t and business factors may be pres- ent when engaging in negotiations, but these factors would have to be considered alongside other factors presented when the commission is determining what the true driving factor is for refusing to deal in a given case and whether that driving factor is reasonable," the agency wrote. The Agriculture Transportation Coa- lition (AgTC) is outrightly pleased, after sharply criticizing the FMC's earlier approach to what factors can be consid- ered justifi able for a container line to not accept a laden import or export con- tainer in a rulemaking draft released last Sept. 13. Justifi able reasons for container lines to not accept bookings include safety issues, a blank sailing or schedul- ing challenges, according to the revised proposed rulemaking. Reasonable debate Continued on page 6 "This second attempt demonstrates how serious the commission is in meeting the objectives of Congress in ORSA-22."

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