by M. Sigmund Shapiro
August 26, 2003
Whoops - I mean is the FMC really necessary? Perhaps it once was
marginally so, but if one looks at its history when it became the
successor to the old Federal Maritime Board, one must wonder.
In its earliest days, the main thrust of the FMC was the dreaded
word 'rebating'. As a result of the FMC's efforts to stop it,
steamship lines started using every technique available to
compensate big shippers by aiding them in misclassification, or even
depositing funds in offshore bank accounts. In one instance the
Commission brought an action against a prominent U.S. Customs broker
for handling a shipment of 'sporting goods' classified as 'toys'. No
on could convince the FMC that the broker here had nothing to do
with the preparation of the bill of lading in Hong Kong.
Then there was the labyrinthine discussion as to when a forwarder
was entitled to collect freight brokerage from the line. Criteria
were set up which were followed to the letter, but ignored in
spirit. The problem was alleviated somewhat when rules came out
allowing 'lump sum quotations' (which in themselves were
unnecessarily complex).
The birth of the NVO meant new, unnecessary rules, which we live
with today. Tariff filing in an age of competitive pricing is an
empty, expensive and bureaucratic exercise benefiting no one.
Rebating, at least overseas is rife; a method of doing business, a
competitive tool and not illegal. Discrimination against NVOs with
respected to service contracts has no meaning. One wonders whether
the fines and penalties collected by the Commission for violations
is its sole source of revenue.
A great comedian, the late Fred Allen described an NBC
vice-president as a 'molehill man'. He would come to work each day
and find a molehill on his desk. His job was to make a mountain out
of it by five o'clock.
Does this describe the FMC ?
