U.S., China sign historic maritime treaty

U.S., China sign historic maritime treaty

WASHINGTON -- U.S. maritime interests will have the same access to the China market that Chinese companies have had here for several years, under a new bilateral maritime agreement signed in Washington Monday afternoon.

That kind of reciprocity was one of the U.S. principal goals in negotiating the pact, according to Maritime Administrator William G. Schubert.

"To be competitive, you need to sell fully integrated intermodal services," Schubert said. The new treaty will allow U.S. shipping companies, or companies that that have a U.S.-flag vessel in the China trade, to open agencies in cities in China's interior.

U.S. carriers also may conduct business without having Chinese partners, a first.

Norman Y. Mineta, Secretary of Transportation, and Jhang Chunxian, China's minister of communications, signed the agreement. The two also signed a memorandum covering issues that the U.S. and China have covered, but are not in the treaty itself.

Schubert said that that one was China's bonding requirements for non-vessel-operating common carriers. The law requires NVOs to post large cash bonds to do business in China. Under the memorandum, U.S. -licensed NVOs may use their U.S. bond as credit to comply with China's law. Schubert said that details of how China will have access to the U.S. surety are still being worked out.

China's government-owned carriers also will get some relief from the U.S. controlled-carrier law. While the law itself does not change, Marad will encourage the Federal Maritime Commission to use its exemption authority to waive the rate-making restrictions under the law.

Several Chinese carriers already have petitions before the FMC seeking such relief.