FMC Votes To Exempt NVOCCs From Publishing Rates (Feb. 19, 2010)

On February 18, 2010, the Federal Maritime Commission voted to approve a proposed rulemaking that would exempt non-vessel-operating common carriers (NVOCCs) from the longstanding requirement that they publish tariff rates. This move was motivated by the FMC’s desire to free NVOCCs from the substantial costs of publishing tariffs, thus saving jobs. The move may result in hundreds of thousands of dollars of annual savings to NVOCCs.

The new exemption would be voluntary, in that an NVOCC may continue to publish rates, although few will likely opt to do so. Additionally, the exemption would be limited to rates, meaning that tariff-publication rules pertaining to contractual terms and conditions governing shipments would continue to apply, and be provided to the public free of charge. For those NVOCCs taking advantage of the exemption, they will be required to publish a notice, within the text of their rules tariff, that they are opting out of publishing tariff rates. Unpublished rate agreements must then be agreed to in writing, including the applicable rate for each shipment, by the date cargo is received by the common carrier or its agent. This writing must also provide notice of the existence and location of the rules tariff. Unpublished rate agreements will be required to be retained for five years.

The move to exempt NVOCCs from rate tariff publication was proposed by the National Customs Brokers and Freight Forwarders Association via a petition filed with the FMC. Although the new rule is not yet final, it is expected to be warmly received by almost all in the OTI community.