Author picture

Stanley O. Sher

The coming year may mercifully see the end of what has become an interminable debate over the need for reform of the U.S. regulatory regime governing liner operators.

Ocean common carriers serving the foreign commerce of the United States were first regulated under the 1916 Shipping Act, which has periodically been amended and revised, most recently in 1961, 1984 and 1998. The touchstone of this U.S. legal regime is a limited, increasingly circumscribed, and highly regulated antitrust exemption for ocean carriers. The exemption existed virtually worldwide until 2008, when the European Union did away with the exemption as it relates to carriers establishing rates for transporting cargo.

Since then, this debate has been somewhat recast to ask whether it is desirable for the U.S., and others, to follow the European model. So far, no other country has followed, but the repetitive and unproductive debate continues. In 2011, this is likely to change.

The U.S. Federal Maritime Commission is studying the European and U.S. systems, an ambitious undertaking that could be a watershed. It will likely bring a fresh dimension to this conversation, one based on facts comparing the two systems, which only now is made possible by the change in the European system.

Hopefully, the FMC study will point a way forward, always elusive in Washington, rather than simply restarting this seemingly endless debate.