Maersk Line Ltd. enters settlement with USSM

Maersk Line Ltd. enters settlement with USSM

   Maersk Line Ltd. said it has entered into a settlement agreement related to the transfer of 15 U.S.-flag vessels from U.S. Ship Management to its direct control.

   Details of the settlement are confidential. However, Maersk Line Ltd. said in statement Tuesday that the settlement “resolves all disputes between the parties and provides for the immediate transfer of operational control to MLL of all vessels that were under time charters between USSM and MLL,” effective Feb. 28.

   Maersk Line Ltd. had assigned the 15 U.S.-flag vessels to USSM after its parent A.P. Moller- Maersk acquired the international liner business of Sea-Land Service in 1999. The action was taken by A.P. Moller-Maersk to maintain the vessels under the U.S. government’s Maritime Security Program. MSP ensures the Defense Department immediate access to militarily useful commercial U.S.-flag vessels during times of war or national emergency.

   In November 2002, Maersk Line Ltd., based in Norfolk, Va., made a request to the Maritime Administration to transfer the 15 MSP vessels to its direct control. USSM fought the transfer, despite MarAd’s approval of Maersk Line Ltd.’s request last year. The transfer of the ships makes Maersk Line Ltd. the largest operator under the newly authorized MSP at 19 ships.

   Overall, Maersk Line Ltd. manages a fleet of 55 ships in commercial and government service, including vessels requiring top security clearances from the U.S. government.