The proposed mega-alliance P3, comprised of the world’s top three container shipping lines, has been given the thumbs-up by the U.S. Federal Maritime Commission (FMC) to share vessels and engage in joint operations.
In a statement on its website dated March 20, the FMC said it granted the regulatory approval after concluding “an extensive review of the proposed P3 Network Vessel Sharing Agreement,” including the additional information submitted by the alliance’s members in response to the FMC’s request.
The FMC’s decision also took into account “the comprehensive, competitive analysis conducted by the FMC staff and comments received from shippers and other stakeholders.”
The clearance “will allow the Agreement to become effective as scheduled on Monday, March 24, 2014,” the statement said.
The approval was given by four of the five commissioners, with Commissioner Richard Lidinsky, Jr. dissenting.
The approved VSA gives the P3 members Maersk Line, CMA CGM, and Mediterranean Shipping Co. permission to share vessels and engage in cooperative operating activities in the trades between the U.S. and Asia, North Europe, and the Mediterranean.
In giving its assent, the commission said it determined 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.”
To prevent unjustified rate hikes or a reduction in capacity as a result of the vessel-sharing agreement, the commission said it will impose new reporting requirements on the P3’s members.
“While the agreement is expected to produce operational efficiencies for the benefit of the U.S. consumer, the new reporting requirements specifically tailored to this agreement’s unique authority will ensure we have timely and relevant information to act quickly should it be necessary,” said FMC Chairman Mario Cordero.
With 255 vessels totaling 2.5 million 20-foot-equivalent units altogether, the P3 is expected to dominate the east-west trade—42 percent of the Asia-Europe trade, 50 percent of the Asia-Mediterranean trade, and 24 percent of the trans-Pacific trade.
The Federal Maritime Commission is the federal agency responsible for regulating the U.S.’s international ocean transportation.
