NSA Option

For many years, shipping carriers were able to create confidential service agreements with their customers, but they could only be made by ocean carriers regardless of who was selling the actual space on the cargo ships. In 2005, the NVOCC Service Arrangement (NSA) option was instituted by the Federal Maritime Commission (FMC) as a measure of fairness to allow Non Vessel Operating Common Carriers (NVOCC) to enter into private service agreements. In the past this privilege was only given to the carriers who would actually own ships. The old way, NVOCC's could not stay as competitive since they were required to use the public tariff agreements which put them at a significant competitive disadvantage in their quoting. While the operating ocean carriers probably did not have a problem with this given that it would allow them a private rate with their accounts, NVOCC's found it to be against the antitrust laws of the United States. Now as long as they are compliant with FMC regulations and the Shipping Act of 1984, they are able to enter into the NSA's allowing more independence from the ocean carriers when establishing new relationships with customers. Just as with operating ocean carriers, the NSA's must follow the regulations set by the FMC. This includes such things as origin/destination and commodity as well as minimum volumes and effective dates. This allows the FMC to properly uphold the antitrust laws while still allowing carriers to establish special volume rates with their bigger customers. Although not everyone was excited about the new FMC ruling, it was the only way to make it a truly fair game in the shipping industry.