JOC Staff | Oct 05, 2011 11:28AM EDT
The Federal Maritime Commission, jumping into a dispute over the shift of imported containers from the United States to Canada, voted Wednesday to launch an inquiry over whether the U.S. is losing Harbor Maintenance Tax revenue because of cargo diversion.
The five-member commission voted unanimously to start the inquiry, which lawmakers from the Pacific Northwest requested after ports there said they were losing container volume to Canadian ports.
The study comes amid complaints that the Canadian government unfairly subsidizes the diversion of U.S. import containers to the Port of Prince Rupert, B.C. FMC Chairman Richard Lidinsky said the agency will report its findings to Congress following the completion of the study.
Unlike a fact-finding investigation or an adjudicatory investigation, the FMC's study, known as notice of inquiry, will solicit voluntary comments and information.
Lidinksy said that the commission had received complaints that the Canadian government is subsidizing rail transportation from the Port of Prince Rupert, B.C., “but we have no evidence of this.” Concerned parties believe that the landed cost of containers at Prince Rupert is lower than at U.S. ports. “They feel there is a subsidy in this process,” Lidinsky said.
The FMC will focus on the effect of the Harbor Maintenance Tax on the diversion of cargo. Carriers pay the tax based on the value of their cargo each time a ship calls at a U.S. port. Cargo landing in Mexico or Canada for shipment to the U.S. does not pay the tax.
Lidinsky said that the FMC will encourage the participation of public and private interests in Canada and Mexico, and that there are more issues that could be considered. He suggested that one item could be the liability for damage to U.S.-bound cargo that transits Canada. “It is in the interest of both countries to get this settled.”
Washington State’s two senators, Patty Murray and Maria Cantwell, both Democrats, sent a letter to Lidinsky on Aug. 28 requesting the study after hearing their states’ ports might be losing business to Prince Rupert. Eight House members, six Democrats and two Republicans, sent an identical letter Friday, with an additional letter from a Democratic member from California.
