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That same month the League met with nine other international shipper groups in Yoko hama, Japan, for the annual Tripartite Shippers' Group conference. The participants reached agreement on a range of issues including regulatory reform, liability, and sharing industry best practices.
Peter Gatti, vice president of international relati ons for the National Industrial Transportation League, talked with World Trade about the League's increasing focus on international trade issues and how it is helping members through the reverberations of Sept. 11. Gatti says the evolution of the League into an international presence was inevitable.
"It's certainly true that the League is looking beyond the nation's borders. Our members are more engaged in international trade than they were just 10 or 15 years ago," Gatti says. "You just can't have a national perspective in the marketplace. If not on a bilateral basis, then certainly on a multilateral basis."
The perspective makes has made it possible to push for a final resolution of issues that have been stalemated for years, such as the carrier liability. The League and WTC's liability agreement was the result of compromises made on both sides.
"A lot of these issues were certainly not new and their elements had already been discussed. In looking at these elements, we wanted to see whether there was any basis for agreement," Gatti says. "Ultimately, the agreement incorporated a lot of points from these discussions. We prioritized a number of things from a U.S. standpoint that we had not been able get agreement on. We were most interested in advancing a system that more accurately reflected modern business practices."
That's why the League is lobbying for the repeal of ratemaking agreements even though Congress opened the door to confidential contracting when it passed the Ocean Shipping Reform Act of 1998. For shippers, ratemaking may be on its last legs but it hasn't toppled over yet.
"This is an issue that can be reflected differently in the U.S. trades versus the non-U.S. trades. Confidential contracting has brought about a more co mpetitive environment. The question now is to what extent should carriers be getting together [to set pricing]," Gatti says. "Ultimately, it will be the service users who will say whether it's worth the trouble in terms of the good it does for their custo mers."
The idea of carriers abandoning the conference model altogether was unthinkable a few years ago. That changed when the Ocean Shipping Reform Act goaded carriers into becoming more creative service providers. They found that they could operate, a nd quite well at that, in a more liberated shipping environment.
"OSRA has been fairly successful in allowing parties to sit down with each other, as they can do in other industries," Gatti notes. "If that kind of success story becomes better known out side of the United States, then it can be the basis for other countries to recognize the success of other shippers."
Gatti predicts OSRA will continue to gain momentum even through the global economic slowdown. "As more experienced is gained, people w ill use aspects of OSRA that enable them to do things they haven't explored yet. It's going to provide a good basis under which we see its applications being taken up in the other trades as well."
Of Sept. 11's impact on shippers, Gatti says it will be come more apparent in stages. "The immediate concern is getting information out to members so they can ensure their freight moves. We're getting out information as quickly as we can regarding the latest regulations. When the airports closed, people had to find alternative transport. A lot of airfreight moves distances of less than 1,000 miles, and could be shifted to truck. Shippers in just-in-time cycles were able to meet demand without significant delay. That's why getting the information out is one of our priorities."-Ann Saccomano
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