The World Shipping Council (WSC), representing the world's container and breakbulk shipping industry, has condemned the US Federal Maritime Commission scheme (FMC) to create a US export freight rate index because it violate existing law and regulations, according to the Shipping Gazette. 
"The FMC's establishment of a rate index would violate the service contract confidentiality provisions of the act and the commission's regulations. That fact alone requires that the rate index proposal be abandoned," said WSC's Notice of Inquiry to the FMC. .
But Drewry's supply chain director Philip Damas in London disagrees. "We think that, if aggregated, the indices will not breach confidentiality," he told American Shipper.
But the Washington-based WSC said: "There is no reason why the FMC should enter this arena when the government has not done so for any other transportation mode, and there is no explanation of how the proposed index would reduce the rate volatility market conditions that its proponents contend it is designed to alter."
The WSC said the existence of such an index, providing transparency to rates, counters the spirit and the letter of the Ocean Shipping Reform Act (OSRA) which holds that contracts must be confidential, reported London's Containerisation International..
A purpose of OSRA is to ensure contract rate information is shielded from public disclosure. "There is no role for the FMC to inform the market of the level of, or changes in, market rates. That is not a legitimate function for the FMC," the statement said.