In June of 2013, the three largest ocean container shipping lines announced their intent to establish the P3 Network that pools vessels operated by Maersk Line, Mediterranean Shipping Line (MSC) and CMA CGM. This alliance would oversee a pooled capacity of vessel routings among the most traveled global trade routings. That includes up to 40 percent of total sea cargo capacity along with an an estimated 43 percent of ocean container shipping from Asia to Europe, 24 percent from Asia to the United States, and 41 percent of trans-Atlantic routings. Such an alliance requires the approval by the combination of Europe, China and U.S. regulatory groups. In our last Supply Chain Matters update, we noted that such approvals were expected to be completed later this year.

The Wall Street Journal reported today (paid subscription or free metered view) that the U.S. Federal Maritime Commission (FMC) is likely to approve the alliance but will attach conditions to ensure fair treatment for smaller competitors, freight forwarders and fuel providers. China and European regulatory approval is not likely until the U.S. weighs-in on its ruling.

The WSJ quotes familiar sources as indicating that the FMC views P3 as a partnership rather than a merger of shipping lines, and if safeguards for fair competition are agreed to, the alliance will likely be approved. The report further confirms that the customers of ship operators are campaigning to block the alliance because they believe they would lose negotiating influence with container shipping lines.  Supply Chain Matters has previously voiced similar concerns for manufacturing and retail shippers.

The open question is now what final conditions will be attached by the U.S. agency.

Stay tuned.