Thursday, September 22, 2011

Transpacific Stabilization Agreement Shifts to Committee Leadership Model

The 15 members of the Transpacific Stabilization Agreement trade group have formally shifted from a single executive leadership model to a structure headed up by a six-member committee.

The shift cements the committee leadership structure put in place in July on the departure of TSA Chairman Y.M. Kim – current president and CEO of Hanjin Shipping – following the end of his 18-month term heading the trade group.

The TSA's six-member executive committee has been acting in an advisory capacity to the overall group since July, but will now officially be responsible for the direct leadership of the group. While the structure change on face value elevates the six-member executive committee's role, a Lloyd's List report indicates that the committee will serve in a steering capacity to the expanded authority of TSA executive administrator Brian Conrad.

The current TSA six-member executive committee includes representatives from APL, Evergreen, Hanjin, Maersk, NYK, and OOCL.

Established in 1989, the TSA describes itself as a "research and discussion forum," for its 15 ocean carrier members, which include: APL, China Shipping, CMA CGM, COSCO, Evergreen, Hanjin, Hapag-Lloyd, Hyundai, K-Line, NYK, Maersk, MSC, OOCL, Yang Ming, and Zim.

Due to US antitrust laws, shippers cannot collectively set rates. The TSA provides a forum where the lines can exchange market information and conduct market research, develop voluntary non-binding guidelines for rates and charges, establish common terms of service and documentation standards on a voluntary non-binding basis, and represent carrier interests to government and business entities.