The Federal Maritime Commission (FMC) has launched an Order of Investigation into the impact of transit constraints at major international maritime chokepoints. This investigation focuses on key global trade routes, including the Panama Canal, Suez Canal, Strait of Gibraltar, Singapore Strait, Malacca Strait, English Channel, and Northern Sea Route.
The FMC aims to determine whether foreign regulations, operational restrictions, or foreign-flagged vessel practices are creating unfavorable conditions for U.S. trade. If an affirmative finding is made, the FMC may take corrective (regulatory) actions, including:
- Limiting voyages to and from U.S. ports or restricting cargo movement
- Suspending rate tariffs, service contracts, or carrier agreements in U.S. trade lanes
- Imposing penalties up to $1 million per voyage
- Blocking vessels from certain countries from entering U.S. waters
The above could lead to delays, unplanned rerouting, and reliability challenges, as well as the introduction of additional fees or pricing adjustments by carriers in response to transit inefficiencies.
The FMC is inviting industry stakeholders to submit comments on how these chokepoint constraints are affecting their businesses. The deadline for comments is May 13, 2025.
Mallory Alexander will continue to monitor this investigation and provide updates on potential impacts to your supply chain. If you would like to discuss any questions or concerns with us, please don’t hesitate to reach out to your Mallory Alexander representative.