In a huge win for motor carriers and cargo owners alike, the Federal Maritime Commission (FMC) sided with motor carriers in their suit against ocean carriers regarding the ability to use chassis of their choice.
A bit of history…in 2020, the American Trucking Associations’ Intermodal Motor Carrier Conference (IMCC) filed suit against the Ocean Carrier Equipment Management Association (OCEMA), Consolidated Chassis Management (CCM) and eleven ocean carriers citing violations of the Shipping Act. The ocean carriers were dictating the chassis provider used even when the ocean carrier did not manage the dray (aka merchant haulage or CY moves). Additionally, the ocean carriers were leveraging their entire volume (carrier and merchant haulage alike) in order to negotiate below market chassis rates for their carrier haulage moves.
Last year, FMC Chief Administrative Law Judge Erin Wirth ruled in favor the IMCC agreeing such business practices were indeed a violation of the Shipping Act of 1984.
The ocean carriers appealed the judge’s ruling and sought a review by the five commissioners of the FMC. In a 4-1 ruling on February 14th, the FMC Commissioners upheld Judge Wirth’s decision. Daniel Maffei, Rebecca Due, Louis Sola and Carl Bentzel were in agreement, and Max Vekich was the lone dissenter.
FMC Chairman Daniel Maffei wrote, “The commission finds that respondents’ rules and practices designating an exclusive chassis provider for merchant haulage and using merchant haulage volume to lower their carrier haulage rates when motor carriers have no choice of providers are unreasonable.” He further added, “Respondents are ordered to cease and desist from the restrictive practices found to be unlawful….”
We applaud the FMC’s ruling and look forward to expanded choice and a level playing field.