Published by The Maritime Executive

Published by The Maritime Executive

Published by The Maritime Executive

Published by The Maritime Executive

Published Mar 16, 2022 2:36 PM by The Maritime Executive

Two weeks after the White House singled out the container shipping industry announcing the administration’s intent to investigate antitrust, competition, and price collusion in the industry, the first news of an investigation surfaced. This follows similar actions by two Congressional subcommittees which also issued requests for information from three of the largest shipping companies.

As first reported by the Journal of Commerce, Maersk has received a subpoena from the U.S. Department of Justice. Details of the investigation have not been announced but it is believed to relate to Biden’s direction to the Department of Justice and the Federal Maritime Commission to ensure compliance with existing antitrust regulations. At issue for the administration is the domination of container shipping by the three big alliances which they highlighted as having rapidly expanded to control 80 percent of global volumes.

Shippers, retailers, manufacturers, and agricultural interests have all been complaining and calling for investigations over the sudden increases in fees and what they have called abusive businesses practices that emerged during the pandemic. In addition to the increase in D&D fees shippers have been experiencing as port congestion worsened, the Biden administration cites the problems of exporters to ship their goods as containerships have skipped ports and rushed back to Asia loaded with empties.

Maersk said it believes the information covered by the subpoena was part of an ongoing investigation by the DOJ into the supply chain disruptions working in cooperation with the Federal Maritime Commission. It is unknown if other carriers were also subpoenaed or how the information DOJ is requesting differs from the requests from the Congressional subcommittees. Maersk, CMA CGM, and Hapag-Lloyd each received requests from Congress for documents and information from each company explaining their decision to increase shipping rates well beyond their costs. The companies were given a deadline of the end of this week to reply.

It is not the first time that DOJ has launched an investigation into the rates and business practices of the large carriers. Almost five years ago to the day, DOJ subpoenaed companies including Maersk, Hapag-Lloyd, Evergreen, OOCL, and others in a wide-reaching investigation. All told 20 companies reportedly were involved in the investigation that lasted two years. At the end of February 2019, Maersk and Hapag confirmed that they have been notified that DOJ closed the investigation without any charges of wrongdoing or antitrust violations.

The current investigations come as Congress is also working on the first major reform of the Ocean Shipping Act in years seeking to expand the oversight capabilities of the FMC and reporting requirements of the major carriers. The draft legislation cleared the U.S. House in late 2021 and is currently being debated in the Senate. President Biden called on Congress to act on the legislation saying he supported the efforts as part of the focus on stopping antitrust behavior.

The shipping industry and many related parties including the ports and even labor unions are aligning to stop the legislative actions. They contend that the alliances are designed only to enhance service and are playing a critical part in maintaining the industry during the current surge in volumes. They argue that the alliances balance capacity and make it possible to offer service to a wider range of ports and if they were impeded by the legislation it would be detrimental to the recovery of the supply chain.  

Published Apr 7, 2022 12:33 AM by The Maritime Executive

In an after-accident report released Tuesday, the National Transportation Safety Board warned of the risk of "sleep inertia" - the temporary feeling of grogginess felt after waking up - for mariners on a rotating watch schedule.  According to NTSB, sleep inertia usually lasts for about 30 minutes after waking, and it may last longer if a person is sleep deprived. It is a common condition for shift workers in all industries, according to the Sleep Foundation. NTSB advises that mariners...

Published Apr 6, 2022 10:33 PM by The Maritime Executive

Turkish military forces have located and neutralized another drifting naval mine in the Black Sea, marking the third in Turkish waters and the fourth in the region since the start of the invasion of Ukraine. On Wednesday, an Underwater Defense (SAS) dive team was ordered to the site to neutralize the mine, and it was successfully detonated.  In a statement, Turkey's defense ministry said that a Liberian-flagged merchant ship had spotted the mine off the coast of Kefken, a town...

Published Apr 6, 2022 9:17 PM by The Maritime Executive

The government of Canada is planning to green-light Equinor's Bay du Nord offshore oil project, according to Canada's CBC.  The controversial $12 billion development would unlock about 0.3-1.0 billion barrels of oil from several fields off the coast of Newfoundland and Labrador. It would create at least $2.8 billion in revenue for Canada's government, according to Equinor, and would lead to the creation of thousands of jobs in politically important regions of Atlantic Canada. Survey data suggests that the overwhelming...

Published Apr 6, 2022 8:32 PM by The Maritime Executive

France’s Chantiers de l’Atlantique shipyard in Saint-Nazaire completed the handover today of the newest cruise ship in the world, Celebrity Beyond to Celebrity Cruises, part of the Royal Caribbean Group. At 140,000 gross tons, she is the largest cruise ship in the Celebrity Cruises fleet expanding on the innovations contained in the Edge class first introduced in 2018. Like the two earlier ships of the class, Celebrity Edge and Celebrity Apex, the new cruise ship features the unique silhouette of...

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