The recently published Federal Maritime Commission (FMC) budget for Fiscal Year 2025 (FY25) demonstrates the Commission’s focus on staffing, restructuring, case prioritization, OSRA implementation, and a new electronic case management system. These updates are part of the $48.4 million congressional funding request FMC submitted for FY25 – an increase of approximately $5 million over the previous year.
FMC STAFF INCREASES
A key focus for FMC is securing funding for an increase in enforcement staff. The FMC reports collecting $2.9 million in civil penalties and investigating 119 complaints in FY23. With new rulemaking expected to go into effect in the coming year, the FMC expect a significant increase in workload. A portion of the budget is earmarked to double enforcement staff by 2025. This significant staffing surge will support audits, investigations, and enforcement proceedings.
“The strategic plan includes performance measures to ensure that the Commission meets its mission, statutory responsibilities, and the needs of a changing ocean transportation supply system. The strategic plan will be revised in FY 2024 to incorporate operational changes resulting from the Commission’s implementation of the Ocean Shipping Reform Act of 2022.”
Federal Maritime Commission | FY 2025 Budget Justification
BEIC REORGANIZATION AND CASE PRIORITIZATION
The FMC announced plans to reorganize its Bureau of Enforcement Investigations and Compliance (BEIC). The BEIC, empowered in 2023 to issue notices of violation and settle civil penalty claims without having to go through the FMC. The FMC is confident the hiring increase will trigger an initial reduction in the number of cases while the Commission focuses on training new and current employees. Priority will go to sensitive cases with additional training planned to improve BEIC employees’ investigative capabilities.
The FMC will prioritize the following case types in 2025:
- Carriers, terminal operators or ocean transportation intermediaries that fail to “establish, observe, and enforce just and reasonable regulations and practices relating to or connected with receiving, handling, storing, or delivering property.”
- Illegal demurrage and detention practices and “improper” use of merchant clauses to shift liability on parties not subject to a contract.
- Carriers that unreasonably refuse to deal or negotiate, including refusing reasonable cargo space.
- Cases involving retaliation.
- False or illegal tariff and service contract activities
OSRA IMPLEMENTATION
The budget accounts for new rules implementation mandated in The Ocean Shipping Reform Act (OSRA). OSRA implementation will include a final ruling on unreasonable carrier conduct, which is expected in the coming months. The FMC is also working on a new data collection process to improve empty container volume tracking at ports. The commission expects the Office of Management and Budget to approve it proposal soon with data collection to begin thereafter.
FMC INFORMATION SYSTEMS UPDATE
The FMC’s Information Technology (IT) system is slated for updates so ocean carriers can easily submit required data and enable efficient processing and publication of the required quarterly reports. Additional technology updates include independent systems and fillable forms for regulated entities submission as well as a system to automate compliance checks for non-vessel operating common carriers.
“The modernized systems will have enhanced analytic capabilities, including dashboards, to support data-driven compliance and enforcement actions and enhance reporting capabilities,” the FMC stated. The updates are scheduled to begin in Q3 of FY24 and will take about 36 months to complete.
The FMC is developing a new electronic filing court management system to replace the outdated, manual entry system currently in place in order to process increased filings and record keeping. The new system will supplant the existing electronic reading room and will grant anyone access to nonconfidential documents including charge complain proceedings. The FMC expects the new system to be online by mid-FY25.
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