Full Volume 19 - Federal Maritime Commission

628
FEDERAL MARITIME COMMISSION
section 16 First with their appreciably lower GSA bids were only offering
such bids in consideration of receiving ocean brokerage from carriers to
cover their forwarding costs in violation of section 51024b of Commis
sion General Order 4 This conclusion was essentially premised on the
finding that based on the relevant factors the average charges may fairly
and reasonably be deemed to be a reflection of
freight
usual charges for
forwarder services
Air Sea Meyer and Cobal except to the Presiding Officer s conclusion
Air Sea and Cobal argue in part that average cannot be made
synonymous with usual Air Sea believes it it absurd to equate
average with usual and that by so doing the Commission makes all
of the fees under the norm illegal Cobal explains that since the
Commission s section 21 Order issued in cor iunction with this proceeding
did not request any breakdown of the fees charged by type of service
provided be it usual or accessorial the responses submitted reflect
only the aggregate of the fees charged commercial shippers in each port
served Since the average fee allegedly does not reflect what services
were performed for a particular shipper in return for the fee
submits that the Presiding Officer s comparison is invalid
Cobal
We do not believe that in all instances the average commercial fee
will be the forwarder s usual fee However given the fact that the
service provided to GSA and to commercial shippers was basically
similar and the number of both GSA and commercial shipments were
sufficiently large in number to be deemed areliable sample the Presiding
Officer s determination on this record that the
average commercial fee
for a given port reflects the forwarder s
unfounded
usual fee for that port is not
But however the usual charge is to be measured or determined the
GSA bids found violative of section 510 24b are below any usual level
and were demonstrably pegged at that level to take advantage of large
volumes of GSA shipments and the accompanying brokerage This is
evident when one compares Air Sea s GSA bid qf 5 cents for Los
Angeles with its correspondent average ocean brokerage return of40 68
Air Sea received over 19 000 in the first half of FY 1973 for handling
government shipments only 45 70 of which can be attributed to
forwarding fees paid by GSA
In FY 1973 Cobal provided GSA with forwarding services for 4 00
per shipment at Houston contrasting with their average commercial price
per shipment of 20 76 Average brokerage received by Cobal on GSA
For the
shipments at Houston was 50 78 during the same period
Respondents found to be in violation of the Act and the Commission
regulations there is evidence in the record of significant variations
between the level of the per shipment bids on GSA shipments and
brokerage received The Presiding Officer found this variation to be of
sufficient magnitude to give rise to the reasonable probability that the low
bids offered GSA by Air Sea Meyer Cobal and Smith were in
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