FMC launches investigation of the impact of Canadian regulations on U.S.-flag carriers
The Federal Maritime Commission launched an investigation to determine if pending Canadian regulations governing ballast water management systems of ships in the U.S.-Canada Great Lakes trade have a disparate effect on U.S. flagged vessels and constitute a Foreign Shipping Practices violation under 46 U.S.C. Chapter 423.
U.S.-based companies operating ships in the U.S.-Canada Great Lakes trade maintain that Canadian regulations taking effect as to some vessels in September 2024 impose a severe burden on their operations and put American companies and vessels at a disadvantage relative to their Canadian competitors.
The Commission is authorized by Title 46, Chapter 423 of the U.S. Code to investigate whether the laws, rules, regulations, policies or practices of another nation result in conditions that adversely affect the operations of United States carriers in the United States oceanborne trade.
The Commission has determined that sufficient facts exist related to the Canadian ballast water regulations to warrant initiating a Foreign Shipping Practices investigation. The investigation will be led by the Commission’s General Counsel, who will prepare and present a report to the Commission containing his findings and recommendations for Commission action within 120 days, unless an extension is approved.
There are significant potential consequences for Canadian-flagged vessels calling at U.S. ports if the Commission determines there has been a violation of the Foreign Shipping Practices provisions. Options for offsetting sanctions include limiting Canadian-flagged vessels from calling at U.S. ports and assessing significant fees on Canadian-flagged vessels.
