Building mountains

In its earliest days, the main thrust of the Federal Maritime Commission was the dreaded word "rebating." As a result of the FMC's efforts to stop it, steamship lines started using every technique available to compensate big shippers by aiding them in misclassification, or even depositing funds in offshore bank accounts.

The commission once brought an action against a prominent U.S. customs broker for handling a shipment of "sporting goods" classified as "toys." No one could convince the FMC that the broker here had nothing to do with the preparation of the bill of lading in Hong Kong.

Then there was the labyrinthine discussion as to when a forwarder was entitled to collect freight brokerage from the line. Criteria were set up that were followed to the letter, but ignored in spirit. The problem was alleviated somewhat when rules came out allowing "lump-sum quotations," which in themselves were unnecessarily complex.

The birth of the NVO meant new, unnecessary rules, which we live with today. Tariff filing in an age of competitive pricing is an empty, expensive and bureaucratic exercise benefiting no one. Rebating, at least overseas, is rife - a method of doing business, a competitive tool and not illegal. Discrimination against NVOs with respect to service contracts has no meaning. One wonders whether the fines and penalties collected by the commission for violations are the agency's sole source of revenue.

A great comedian, the late Fred Allen, described an NBC vice president as a "molehill man." He would come to work each day and find a molehill on his desk. His job was to make a mountain out of it by five o'clock.

Does this describe the FMC?

M. Sigmund Shapiro


Samuel Shapiro & Co.