From the Maritime Practice.

Carriers Targeted To Lose Antitrust Immunity

January, 2000

The Ocean Shipping Reform Act (“OSRA”), which was signed into law by President Clinton on October 14, 1998, is back in the news again, as Representative Henry Hyde (R.-Ill), Chairman of the House Judiciary Committee, has introduced a bill to amend that Act to eliminate antitrust immunity for ocean carriers. Hyde’s bill, called the Free Market Antitrust Immunity Reform Act of 1999, or “FAIR,” would retain antitrust immunity for Ports and marine terminal operators. The bill was introduced in reaction to complaints by freight forwarders and non-vessel-operating common carriers (NVOCC’s) that OSRA’s provisions allowing carriers (but not NVOCC’s) to enter into confidential service contracts, when coupled with antitrust immunity, was unfair to small shippers who dealt mostly with NVOCC’s.

When OSRA was originally passed, the antitrust immunity provisions were supported by the last remaining U.S. carriers, including Sea-Land. However, with the announcement that Sea-Land’s international operations were being acquired by A.P. Moller Group of Denmark, Hyde felt that the original rationale for carrier antitrust immunity no longer existed and that OSRA benefitted foreign carriers at the expense of American consumers. The House Judiciary Committee is expected to hold hearings on Rep. Hyde’s bill early in 2000.