SUPPLEMENTARY INFORMATION:

I. Background

A controlled carrier is a vessel-operating common carrier that is owned or controlled by a foreign government.^[1] Controlled carriers are subject to enhanced regulatory oversight to ensure that they do not abuse their subsidized position in the marketplace.^[2] One of the provisions of 46 U.S.C. chapter 407 stipulates that the tariff rates or charges of controlled carriers cannot become effective until the 30th day after their publication.^[3]

The Commission has previously granted exemptions to certain controlled carriers from the requirements of 46 U.S.C. 40703, pursuant to the administrative exemption authority found at 46 U.S.C. 40103. Such exemptions allowed these controlled carriers' rates, charges, classifications, rules and regulations to become effective less than 30 days after publication. These exemptions did not change the status of any of these carriers as controlled carriers; they were limited to allowing the carrier's rates, charges, classifications, rules or regulations to become effective in less than 30 days' notice.^[4] The Commission also has the authority to revoke previously granted administrative exemptions.^[5] In granting exemptions from section 40703, the Commission has declined to grant permanent exemptions because doing so would impinge on the Commission's authority to revoke them.^[6]

In 2004, sections of the Shipping Act of 1984 were rearranged and renumbered. Exemptions under section 9(c) of the Shipping Act that had been codified at 46 U.S.C. app. 1708, allowing changes to controlled carriers' rates, charges, classifications, rules or regulations to become effective more quickly than 30 days after publication with Commission permission, were moved to 46 U.S.C. 40703. The statutory language of the two sections is nearly identical. In addition, Commission explanations suggest that the Commission did not view exemptions from section 40703 differently than exemptions from section 1708. For example, in granting section 40703 exemptions to United Arab Shipping Company (S.A.G.) and Hainan P O Shipping Co., Ltd., the Commission stated that it “has previously granted exemptions from [section] 40703,” and cited to some exemptions that were granted from section 40703 and to others that were granted from section 1708.^[7] As such, it is the Commission's position that historically, it has viewed the exemptions granted from section 1708 to be equivalent to the exemptions granted from section 40703.

On May 30, 2025, the Commission published a Notice of Intent to Revoke Exemptions Granted to Certain Controlled Carriers that were no longer on the Commission's list of controlled carriers.^[8] No comments were received in response to this notice.

II. Revocation of Certain Exemptions From 46 U.S.C. 40703

Many of the entities to which the Commission granted exemptions from 46 U.S.C. 40703 have since been removed from the Commission's list of controlled carriers for various reasons, such as no longer offering carriage in the U.S. trades or having been bought by private companies. Because the Commission has declined to grant permanent exemptions,^[9] there should not be any expectations that these exemptions are permanent. However, until now, the Commission has not revoked any exemptions, even when an entity's circumstances have changed, such as having been removed from the list of controlled carriers. Rather than allowing that to create an expectation that an exemption remains valid through such changes in circumstances, the Commission is taking this action to give notice that these exemptions are, in fact, terminated.

The revocation of these exemptions does not prevent an entity from petitioning for an exemption again, if its status changes such that it again becomes classified as a controlled carrier. The Commission is hereby revoking the section 40703 exemptions of the following entities:

1. Sinotrans Container Lines Co., Ltd., Docket No. 25-17;

2. Hainan P O Shipping Co., Ltd., Docket No. 25-18;

3. United Arab Shipping Company (S.A.G.), Docket No. 25-19;

4. China Shipping (Hong Kong) Container Lines Co., Ltd., Docket No. 25-20;

5. China Shipping Container Lines Co., Ltd., Docket No. 25-21;

6. American President Lines, Ltd. and APL Co., Pte. Ltd., Docket No. 25-22; and

7. COSCO Container Lines Europe GmbH, Docket No. 25-23.

These entities were removed from the list of controlled carriers over the years. As such, they are no longer controlled carriers under 46 U.S.C. 40102(9), 46 U.S.C. chapter 407, and 46 CFR part 565. As a result, the Commission finds that there is good cause to revoke their exemptions. Therefore, the Commission issues this final notice of revocation. The Commission Orders to each of these carriers, effectuating this revocation, are available on the Commission's electronic Reading Room at https://www2.fmc.gov/​readingroom/​ under Docket Numbers 25-17 through 25-23.

The exemptions that the Commission has granted to Orient Overseas Container Line Limited,^[10] OOCL (Europe) Limited,^[11] and COSCO SHIPPING Lines Co., Ltd.,^[12] and the Chinese-Polish Joint Stock Shipping Company (“Chipolbrok”) ^[13] remain in place because these companies are still on the Commission's list of controlled carriers. However, the Commission may review these exemptions in the future.

90 FR 41562