JOC Staff | Nov 27, 2012 1:16PM EST
Members of the Transpacific Stabilization Agreement filed an amendment with the U.S. Federal Maritime Commission that would expand the discussion group's scope to include the entire trans-Pacific round trip, including the westbound trade. Once the amendment becomes effective, the lines are expected to suspend activities of the existing U.S.-Asia carrier group, the Westbound Transpacific Stabilization Agreement.
The TSA filed the amendment for a 24-month trial period, subject to review at the end of that time.
The primary purpose of streamlining the agreements is to cut costs, TSA Executive Administrator Brian Conrad said. Maintaining separate carrier agreements, each with its own meetings, dedicated carrier staff support, compliance requirements and administrative overhead is less justifiable than in the past, especially given the sustained low-revenue environment seen in recent years. Conrad noted nearly all other major trade lanes with carrier agreements are represented by a single group that includes the round trip trade in its scope.
“The same lines carry the cargo in both directions on the same vessels, as part of their round-trip service rotations,” he said. “Since they operate their business on round-trip basis, it only makes sense to view the two segments as an integrated whole from an agreement perspective as well.”
For JOC analysis of what a TSA-WTSA combination would mean, click here.
