Home » Breaking News, Maritime » US regulator clears G6 Alliance service expansion

Port of Los Angeles (2)The Federal Maritime Commission (FMC) of the United States has granted the request of the G6 Alliance to extend its operations to the Asia-North America West Coast and trans-Atlantic trade lanes.

The approval was made via a unanimous decision among the five commissioners, permitting the G6 parties to engage in geographically broader operations effective as scheduled on April 4, 2014.

“The Commission’s decision is based on a determination that the agreement is not likely at this time, by a reduction in competition, to produce an unreasonable increase in transportation cost or an unreasonable reduction in transportation service under section 6(g) of the Shipping Act,” an official FMC statement said.

“The Commission’s action on the G6 Alliance is based on an extensive, competitive analysis conducted by the Commission’s staff and comments received by shippers and other industry participants,” said Chairman Mario Cordero. “The Commission will continue to review the competitive impact of global alliances.”

He added that the G6 Alliance’s amended agreement would “considerably increase available capacity in the expanded geographic scope, and has the potential to generate operational efficiencies and positive environmental benefits.”

Before the regulatory clearance, the G6 Alliance already announced last month the port rotations for the proposed service expansion to the Asia-North America West Coast and trans-Atlantic trade lanes.

The 17 services are scheduled to start in the second quarter of 2014, broken down into 12 services on the Asia-North America West Coast lane and five on the trans-Atlantic loop.

On December 2, 2013, the six-member G6 filed an amendment with the commission to extend their cooperation. The existing agreement authorizes the members to share vessel space with each other and enter into cooperative working arrangements in the Asia-U.S. East Coast trade.

“Their amendment would extend their authorization to encompass the major east-west trades, including that between Asia and the U.S. West Coast, and between Northern Europe/Mediterranean and all U.S. coasts,” an earlier FMC statement said.

Members of the G6 Alliance are APL, Hapag-Lloyd, Hyundai Merchant Marine, Mitsui O.S.K. Lines, Nippon Yusen Kaisha, and Orient Overseas Container Line.

Last month, the FMC also cleared the mega-alliance P3, comprised of the world’s top three container shipping lines, to share vessels and engage in joint operations.

The approval gives the P3 members Maersk Line, CMA CGM, and Mediterranean Shipping Co. permission to jointly operate in the trades between the U.S. and Asia, North Europe, and the Mediterranean.

The Federal Maritime Commission is the federal agency responsible for regulating the United States’ international ocean transportation on behalf of exporters, importers, and the American consumer.

Photo: Green Fire Productions

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