Opinion for the court filed by Circuit Judge McGOWAN.
Opinion dissenting filed by Senior Circuit Judge LUMBARD.
McGOWAN, Circuit Judge.
These consolidated cases arise on petition for review of two Federal Maritime Commission (FMC or Commission) decisions that resulted from a controversy surrounding two high-speed container cranes located on berths at the “Isla Grande” terminal at the port of San Juan, Puerto Rico. In FMC Docket No. 76-38 the Commission found that the Puerto Rico Ports Authority (Ports Authority) and the Puerto Rico Maritime Shipping Authority (PRMSA) had violated section 15 of the Shipping Act, 46 U.S.C. § 814 (1976), through their failure to secure Commission approval of agreements concerning the use of terminal facilities. In FMC Docket No. 76-41, the Commission found violations of sections 16 and 17 of the Shipping Act, 46 U.S.C. §§ 815, 816 (1976), through the Ports Authority’s failure to condition PRMSA’s use of the terminal on, and PRMSA’s failure to allow, sharing of PRMSA’s high-speed container cranes by a competing carrier. For the reasons hereinafter appearing, we reverse the Commission as to each of the violations determined by it to exist.
I
The Puerto Rico Ports Authority, established by the Puerto Rico Legislature in 1942, is a public corporation charged with the ownership, development, and operation of transportation facilities and marine services in, to, and from Puerto Rico. It holds the sole authority to select and assign suitable berths to vessels calling at the Port of San Juan.
The Puerto Rico Maritime Shipping Authority, established in 1974, is a nonstock [69]*69public corporation organized to provide ocean common carrier service between mainland United States and the Commonwealth of Puerto Rico. To implement its operation, it acquired vessels, equipment, and terminal leasehold improvements from several container carriers. These included Seatrain Lines, Inc., which had owned the facilities at Isla Grande, as well as Sea-Land Service, Inc., and Sea-Land’s affiliate Gulf Puerto Rico Lines, Inc. In addition, PRMSA acquired the outstanding stock of the roll on/roll off carrier Transamerican Trailer Transport, Inc. In October 1974, PRMSA began carrier service between San Juan and the Atlantic and Gulf Coasts of the United States.
Seatrain Gitmo, Inc. is a subsidiary of Seatrain Lines, Inc., whose assets PRMSA had acquired at the outset of its carrier service. Both are intervenors in this litigation and are referred to collectively as Sea-train. After having left the Puerto Rico-mainland trade with the sale of assets devoted thereto in 1974, Seatrain reentered that trade between Atlantic ports and Puerto Rico in January 1976. Its reentry and concomitant request for berthing facilities in Puerto Rico precipitated this litigation.
The Port of San Juan comprises a number of terminal facilities, among them Isla Grande, Puerto Nuevo, Pan American Dock, Frontier Pier, and Puerto Rican Drydock. For eontainership operation, Isla Grande and Puerto Nuevo assume the most significance; Isla Grande, however, is the focus of this litigation.
Isla Grande terminal has been used for eontainership operation since 1962, and its rather unique configuration is critical to the FMC decisions under review. Isla Grande has two 663 foot berths, which are contiguous end to end. Extending along the water side of the wharf for the length of the berths is a “dip,” 15-22 feet wide and IV2S feet lower than the bulkhead (the beginning of the wharf structure at the water line) and the remainder of the wharf. Steel “bitts” or piles, 2lh feet high and 2 feet in diameter, are located every 100 feet along the center of the dip. The presence of this dip affects the use of the terminal. Ship-mounted cranes can be used effectively only if they have the reach necessary to place cargo over the dip. Mobile cranes, which might otherwise operate within the dip, are impeded by the bitts, which are used to moor vessels. To circumvent these difficulties, two parallel crane rails, designed to accommodate shoreside container cranes, are embedded on the wharf, the first almost next to the dip, and the second, in back of the first. High-speed shoreside cranes, owned by Seatrain until PRMSA purchased them in 1974, are installed on these rails. Behind the 250 foot wide wharf is a marshalling area of approximately 21 acres. The entire terminal occupies approximately 35 acres.
Puerto Nuevo, the newest docking area in the Port of San Juan, has been planned and developed as the major container facility in the port, with the potential for future expansion. The Ports Authority has constructed ten berths at Puerto Nuevo, four of which have been in use throughout the Commission’s proceedings in these cases. Parallel crane rails extend across these four berths (E, F, G, H) and across two others (J, K) that have not been used for container operations. The remaining Puerto Nuevo berths have no crane rails, but are designed to accommodate them.
In developing docking facilities at the Port of San Juan, the Ports Authority has adopted a passive approach. Instead of providing all the facilities essential to container shipping, it opted to develop the harbors, wharves, and channels and to offer only berths and wharfing areas to the carriers. Any further improvements essential to eontainership operations were to be installed by the carriers themselves, to suit their individual needs. Such improvements might include crane rails and container cranes, pavement of backup land, lighting, fencing, and any necessary buildings. The Ports Authority protected the carriers’ investments by offering long-term agreements for preferential use of the berths and adjacent wharves, and long-term exclusive leases of backup land.
[70]*70Modern containership operation depends on the availability of container cranes, either shoreside, mobile, or ship-mounted, for the efficient handling of cargo. Although containership operations began at the Port of San Juan in the early 1960s, high-speed container cranes were installed only later, by the carriers themselves in accordance with the Ports Authority’s passive development plan. The agreements negotiated with individual carriers regarding the use of those cranes reflected the gradual development of the port for container shipping. Prior to the installation of cranes at Puerto Nuevo, for example, the Ports Authority had executed, with both Seatrain at Isla Grande and another carrier, Sea-Land Service, Inc., long-term agreements that required no equipment sharing. After Sea-Land installed high-speed cranes at Puerto Nuevo in 1965, the Ports Authority required Sea-Land to operate those cranes for other carriers, if such use would not interfere with Sea-Land’s own operations. In 1975, however, when the Ports Authority negotiated new agreements for Puerto Nuevo with Sea-Land and with PRMSA (partial successor to Sea-Land at Puerto Nuevo), the agreements required no crane sharing. By then the Ports Authority had developed enough berths at Puerto Nuevo so that it could offer facilities on which containership carriers could install their own cranes and other equipment. No longer was crane sharing necessary to ensure access to the Port of San Juan for all container carriers.
Because Isla Grande is the focus of this controversy, a more detailed account of the situation existing at that terminal is required. In accordance with the Ports Authority plan for developing the Port of San Juan, Seatrain helped to improve the Isla Grande terminal. It installed crane rails, container cranes, paving, and other improvements. According to the terms of a 15-year agreement executed in 1972,1 title to these improvements, with the exception of the crane rails, would remain in Seatrain until the expiration of the agreement. Title to the crane rails, in contrast, was to vest immediately in the Ports Authority. In 1974 at Seatrain’s request, the Ports Authority released title to the crane rails so that Seatrain could sell them to PRMSA. Thus, when PRMSA entered the carrier trade in late 1974, it purchased Seatrain’s vessels and terminal assets, including the cranes and crane rails. For the crane rails, PRMSA paid $512,554.93; for the cranes, $2,204,223.74.
Like the pre-1975 agreements executed for the Puerto Nuevo berths, the 1972 agreement between the Ports Authority and Seatrain for Isla Grande had included a crane sharing requirement: if the Ports Authority determined that crane sharing would not interfere with Seatrain’s operations, the Authority could require Seatrain to furnish crane service to other carriers. The Ports Authority invoked this provision only twice, for noncommercial vessels. J.A., at 668.
When PRMSA purchased Seatrain’s assets in 1974, Seatrain demanded release from its 1972 agreement. The Ports Authority consented only after PRMSA had committed itself to assume, but had not actually assumed, Seatrain’s obligations under the 1972 agreement. When the Ports Authority and PRMSA finally executed an agreement in 1976, however, that agreement did not include the crane-sharing obligation. The Ports Authority attributes its failure to require secondary crane use to the pressing financial need for a signed lease for the Isla Grande terminal and, more importantly, to the inconsistency of a crane-sharing requirement with both the Ports Authority’s overall plan for the development of the Port of San Juan and the availability of unimproved berths at Puerto Nuevo. This lack of a secondary use requirement and PRMSA’s refusal to share its cranes voluntarily with Seatrain, its predecessor at Isla Grande and now its competi[71]*71tor, led to the Commission’s finding of sections 16 and 17 violations. In addition, the Commission found that PRMSA and the Ports Authority had implemented an agreement for the use of Isla Grande without prior Commission approval, in violation of section 15 of the Shipping Act.
II
Section 15 of the Shipping Act, 46 U.S.C. § 814 (1976), ensures Federal Maritime Commission supervision of designated classifications of agreements pertaining to the common carriage of goods by water. It requires such agreements to be filed with the Commission promptly; vests in the Commission the power to approve, disapprove, cancel, or modify the agreements; and provides that the agreements can be implemented lawfully only after Commission approval.2 The requirements of section 15 extend to every “common carrier by water, or other person subject to this chapter.” 3 No one disputes that both the Ports Authority and PRMSA come within its purview. Moreover, those parties concede that agreements in which a terminal operator grants a carrier preferential berthing rights in a marine terminal facility require section 15 approval.4 At issue in this litigation is whether such preferential agreements subject to section 15 existed between the Ports Authority and PRMSA.
In Docket No. 76-38, the Commission found violations of section 15 in connection with three agreements between the Ports Authority and common carriers for the use of- Isla Grande terminal.5 Although only [72]*72the Commission’s findings as to the arrangement between the Ports Authority and PRMSA are the subjects of appeal in this litigation, an understanding of this arrangement requires a brief explanation of the earlier agreements.
When PRMSA entered the Puerto Rico carrier trade in 1974 Seatrain had been docking at Isla Grande for some 12 years. In 1962 and again in 1968, the Ports Authority and Seatrain had entered into agreements found not to be subject to section 15. In 1972, however, Seatrain entered into another agreement for preferential berthing rights and exclusive use of the marshalling area at Isla Grande.6 The implementation of that agreement, neither filed with nor approved by the Commission, was held in No. 76-38 to violate section 15. In conjunction with PRMSA’s purchase of Seatrain’s assets in 1974, Seatrain and the Ports Authority executed but did not file a lease termination agreement, also found by the Commission to have violated section 15.
As PRMSA entered the container trade, it advised the Ports Authority of its willingness to enter into contracts assuming Sea-train’s obligations under the 1972 agreement. Nonetheless, in October 1974 PRMSA initiated its container operations at Isla Grande without having executed contracts with the Ports Authority. Only in October 1975 was an agreement drafted, and the parties did not execute that agreement until May 1976, when they filed it with the Commission. The agreement, T-3308, granted PRMSA preferential use of the berth and wharf, and exclusive use of the marshalling area at Isla Grande, in exchange for specified annual fees in addition to the usual dockage and wharfage tariffs. Seatrain protested the agreement, and the Commission held it for 10 months without taking action. In March 1979, Agreement T-3308 was withdrawn, and two superseding agreements, T-3453 and T-3453A, were filed.
In PMC Docket No. 76-38, the Commission concluded that the Ports Authority and PRMSA had committed two separate violations of section 15. One involved the marshalling or backup area, and stemmed from an oral agreement giving PRMSA exclusive use of the area. The other involved the berthing area, and resulted, not from agreement T-3308, but from an unfiled, unapproved agreement that the .Commission inferred from the evidence in this docket and in Docket No. 76-41. Because we find neither conclusion supported by substantial evidence,7 we reverse the Commission’s findings of section 15 violations.
The Marshalling Area
The parties conceded that PRMSA was using the backup area at Isla Grande pursuant to an oral agreement, neither submitted to nor approved by the Commission, with the Ports Authority, pending execution of a written lease. Thus, the existence of a section 15 violation turns on whether that oral lease of backup land was subject to approval by the Commission.
According to Commission precedent, a landlord-tenant agreement between a ports authority and a carrier for use of a marshalling area is subject to section 15 approval only when the area is “essential” to use of the berth.8 The Commission’s finding [73]*73that the marshalling area at Isla Grande is essential is therefore critical to its decision and must be supported by substantial evidence in the record. No such substantial evidence exists in Docket No. 76-38. Indeed, the record suggests the opposite conclusion: Seatrain’s own statements imply that the marshalling area is not essential for effective use of the berths at Isla Grande. Seatrain’s initial written request to gain access to Isla Grande specified its need for a marshalling area of approximately 5 acres, which could be separated from the Isla Grande terminal.9 Moreover, in an affidavit contravening the suggestion that Seatrain’s use of the Isla Grande would cause congestion at the terminal, a Seatrain vice president stated that Seatrain could discharge its vessels at Isla Grande and move the container to its marshalling area at the nearby Pan American Dock.10
In the absence of substantial evidence as to the essentiality of the marshalling area to the use of Isla Grande,11 the Commission’s finding that the oral lease was subject to section 15 approval must fail. Accordingly, the Commission’s decision that the Ports Authority and PRMSA violated section 15 by failing to secure approval of the oral lease is reversed.
The Berthing Area
The Commission found that “the evidence establishes the existence of an unfiled, unapproved agreement relating to PRMSA’s use of the berthing area at Isla Grande.” J. A., at 18. To support this conclusion, the Commission noted that no other carrier has used Isla Grande since PRMSA began operations there,12 and cited the presence of PRMSA’s assets at the terminal. The Commission also asserted that Isla Grande is virtually useless as a container terminal without PRMSA’s cranes, which PRMSA will not share; therefore the terminal is not available to other carriers on any basis. As additional factors in its decision, the Commission cited the Ports Authority’s consent to a possible assignment by Seatrain of its rights, covenants, and obligations (presumably, but not explicitly, including Seatrain’s secondary crane use provision) to PRMSA, J. A., at 66; a letter from Teodoro Moscoso, Chairman of PRMSA, expressing PRMSA’s willingness to assume the obligations established in Seatrain’s then-terminated lease, J. A., at 1198; the effective date (1 October 1975) contained in agreement No. T-3308;13 and the unity of PRMSA and the Ports Authority insofar as Isla Grande is concerned.14 [74]*74The unfiled agreement established by this evidence, the Commission concluded, constituted a violation of section 15.15
The evidence adduced in Docket No. 76-38 is insufficient to support the Commission’s finding of an unfiled agreement between the Ports Authority and PRMSA. Rather, uncontroverted evidence shows that PRMSA paid only the standard wharfage and dockage charges prescribed by the Ports Authority tariff, and did not pay any preferential berthing fee.16 Moreover, the critical finding that Isla Grande is unavailable for use by other container carriers without PRMSA’s cranes is not supported by substantial evidence in the record. Indeed, the question of Isla Grande’s availability to other carriers without PRMSA’s cranes was not posed in this proceeding, and no evidence directly on that issue was adduced.17 Thus, the only other source for evidence is Docket No. 76-41, of which the Commission took official notice.
Even if No. 76-41 provided substantial evidence as to the necessity of PRMSA’s cranes for the use of Isla Grande,18 the Commission’s official notice of that proceeding was improper. The Commission’s Rule 226 permits official notice of “such matters as might be judicially noticed by the courts, or of technical or scientific facts within the general knowledge of the Commission as an expert body.” 19 The issue of Isla Grande’s [75]*75usefulness without PRMSA’s cranes, rooted in factual determinations focusing on the structure of the wharf, requires direct evidence, and is not a technical or scientific fact within the Commission’s general knowledge. Although in some instances, as the Commission asserts, it may be permissible to take official notice of evidence from one proceeding in another,20 that practice is impermissible when it is prejudicial and the parties have no opportunity to challenge the facts. In a case in which an agency faced with two related proceedings looked to evidence from both in forming its judgment, the Supreme Court stated:
if [that practice] has resulted in substantial prejudice ... as might occur, for example, if the Commission were shown prejudicially to have considered evidence bearing on one case which did not affect it and was presented in the other, and which appellees were given no opportunity to meet, the orders, or one of them, would be improperly grounded.
United States v. Pierce Auto Freight Lines, Inc., 327 U.S. 515, 528, 66 S.Ct. 687, 694, 90 L.Ed. 821 (1946). One of the issues posed in Docket No. 76-41 was whether Isla Grande is adequate for Seatrain’s container service (using a vessel with no shipboard cranes) without the use of PRMSA’s cranes, J. A.,. at 548, not whether that facility can be used practicably by any container vessels only with PRMSA’s cranes. The parties did not address the broader issue directly, nor did the Ports Authority and PRMSA have the opportunity to meet evidence on that issue. The Commission’s use of evidence on the issue of the essentiality of the cranes, insofar as that evidence existed, from Docket No. 76-41 in Docket No. 76-38 is therefore improper.
Moreover, evidence introduced in No. 76-38 after the proceeding was reopened, but not considered or relied on in the FMC decision, contravenes the Commission’s conclusion that PRMSA was using Isla Grande pursuant to an unfiled section 15 agreement. Evidence entered in the reopened proceeding was directed towards whether the Ports Authority had excluded another carrier, CAROL Lines, from Isla Grande or had offered the facility to CAROL. That evidence, although not without contradiction,21 tends to show that the Ports Authority offered Isla Grande to CAROL Lines on a first-come, first-served basis,22 and weighs against the Commission’s finding of a preference toward PRMSA.
After examining the evidence in the reopened proceeding and finding it unnecessary to a decision on issues raised in No. 76-38, the Commission stated it did not rely on that evidence and denied the request of the Ports Authority and PRMSA for an evidentiary hearing on the evidence. J. A., at 21. Having reopened the hearing to admit new evidence, however, the Commission cannot ignore the evidence admitted. The requirement of a hearing “implies both the privilege of introducing evidence and the duty of deciding in accordance with it. To refuse to consider evidence introduced or to make an essential finding without supporting evidence is arbitrary action.” The Chicago Junction Case, 264 U.S. 258, 265, 44 S.Ct. 317, 320, 68 L.Ed. 667 (1924).23
We conclude that the Commission’s finding of an unfiled, unapproved agreement between the Ports Authority and PRMSA regarding the use of the berthing area at Isla Grande is not supported by substantial evidence in the record. Accordingly, we reverse.
Ill
Section 16 First of the Shipping Act, 46 U.S.C. § 815 (1976), makes it unlawful for any “common carrier by water, or other person subject to this chapter” to confer any undue or unreasonable preference or to impose any undue or unreasonable prejudice or disadvantage on any person, locality, [76]*76or description of traffic.24 In Docket No. 76-41, the Commission, adopting with clarifications the Initial Decision of the Administrative Law Judge,25 found that both the Ports Authority and PRMSA had violated section 16 First. The Ports Authority violated section 16 First by failing to ensure that the public facilities at Isla Grande did not become dedicated to private exclusive use. J. A., at 287. PRMSA’s violation was to grant unreasonable preference to itself, by exclusive use of the public area at Isla Grande and by exclusive use of its own cranes situated on that property. J. A. at 284.
The Ports Authority
The Commission asserts, and the Ports Authority agrees, that Isla Grande is a public terminal for which no section 15 preferential use agreement has been approved.26 Despite the public character of the terminal, however, the Authority will not assign to Isla Grande a vessel that cannot feasibly work there. And, the Commission continued, a vessel cannot feasibly be worked without the use of PRMSA’s shoreside cranes, which PRMSA refuses to share. The Ports Authority’s acquiescence in this refusal, in denigration of its authority to require secondary crane use, has the effect of granting to PRMSA both an unreasonable preference and control of berthing at Isla Grande. J. A., at 285-86.
Preliminarily, it must be noted that section 16 imposes no general requirement that a port operator provide terminal equipment to carriers. Moreover, the Commission decision in this proceeding indicates that the Port Authority has no generalized duty to require crane sharing at the Port of San Juan. The Commission decision noted that the crane-sharing requirement was intended to “right a wrong” at Isla Grande, and not “to apply indiscriminately to ‘docks all over the country.’ ”27 Thus, the peculiar configuration at Isla Grande and the Commission’s conclusions as to its effect have led the Commission to its decision that to avoid a violation of section 16 First, the Ports Authority must require PRMSA to share its cranes at Isla Grande.
The conclusion that, due to its configuration, Isla Grande cannot be used without PRMSA’s cranes is critical to the Commission’s determination that PRMSA controls the terminal and therefore has been granted a preference. We find, however, that the evidence in No. 76-41 does not support that conclusion. One of the issues that the Commission had posed for the Administrative Law Judge was whether Isla Grande is adequate for Seatrain’s container service without the use of PRMSA’s container cranes. J. A., at 548. The Seatrain vessel, Transindia, has no shipboard container cranes and must rely on shore side or mobile cranes to work at Isla Grande. The configuration of the dock makes the use of mobile cranes impracticable, if not impossi[77]*77ble. Without PRMSA’s cranes, the Administrative Law Judge concluded, Seatrain’s vessel cannot work at Isla Grande. J. A., at 548-50.
Without impugning the accuracy of the conclusion as to Seatrain’s vessel, we note that the usability of Isla Grande without PRMSA’s cranes by vessels — container or noncontainer — other than Seatrain’s was not at issue in the proceeding, nor did the Administrative Law Judge reach a conclusion as to that broader issue. The Commission decision nevertheless states that “PRMSA acknowledges that a vessel berthing at Isla Grande cannot feasibly be worked without the use of shoreside cranes[.]” J. A., at 285. We find that this conclusion is not supported by substantial evidence. The Initial Decision cites only two pieces of evidence to support its finding that vessels with shipmounted gantries cannot use Isla Grande.28 These do not provide substantial evidence that shipboard cranes cannot reach over the dip. Moreover, the presence of the cranes notwithstanding, evidence in No. 76-41 did not address and therefore did not resolve the issue whether Isla Grande can be used for breakbulk or roll on/roll off vessels.
Absent substantial evidence of the inability of other vessels to use Isla Grande without PRMSA’s cranes, the Commission’s conclusion that PRMSA controls Isla Grande cannot stand. It is our view that the cranes enhance, rather than control, Isla Grande. Indeed, as counsel for the Commission acknowledged at oral argument before this Court, PRMSA is perfectly free to remove its cranes from the berths, an action that would return Isla Grande to its former status as a breakbulk terminal.
Assuming, arguendo, that the evidence had shown that Isla Grande cannot be used without PRMSA’s cranes, we are not compelled to find that the Ports Authority’s acquiescence in PRMSA’s refusal to share the cranes constituted a section 16 First violation. That section prohibits preferences and discriminations that are “undue or unreasonable.”29 The situation existing at the Port of San Juan involved no undue or unreasonable preference or discrimination. On the contrary, the Ports Authority offered to treat all carriers, including Sea-train, fairly, within the ambit of its passive port development plan. Only four of the ten contiguous container berths at Puerto Nuevo had been in use prior to and during the Commission proceedings, J. A., at 517. Other berths were, and continue to be, available for Seatrain, on the same terms accorded to other carriers, to develop to suit its container trade; alternatively, Seatrain could call at an undeveloped berth and use mobile cranes to move its containers.
Commission precedent establishes that the exclusive assignment of public facilities to one carrier does not violate section 16 unless the challenged lease either fails to compensate the port adequately30 or unreasonably forecloses other carriers from securing adequate facilities. Moreover, the [78]*78Commission has expressly refused to find discrimination or preference in a situation in which the port indicated willingness to make similar, but not necessarily identical, arrangements available to other carriers.31 At San Juan, the Ports Authority provides similar facilities to all carriers: berths, port dredging, properly constructed wharves, paved transit areas, and the opportunity to lease ready-to-pave backup areas. To satisfy requirements beyond these each carrier is free to lease and improve a berth and backup area, or to work a public facility, using mobile cranes. The Ports Authority suited its berthing assignments to each carrier’s operations, with a simultaneous view to both the development of the total Port of San Juan and its own economic needs.32 Its treatment of. both PRMSA and Seatrain was consistent with these goals and does not constitute a violation of section 16 First.
PRMSA
In finding that PRMSA has violated section 16 First, the Commission focused on PRMSA’s exclusive use of the public areas at Isla Grande. It held that PRMSA’s refusal to share its shoreside cranes, thereby depriving other carriers of the use of Isla Grande, resulted in PRMSA’s granting to itself an undue and unreasonable preference over other carriers. J. A., at 287-88.
Because section 16 First prohibits the imposition of undue or unreasonable prejudice or disadvantage, a violation of that section normally involves a “triangular relationship” between the violator, the preferred party, and the party suffering discrimination. One carrier’s preference for itself over another carrier lacks such a triangular relationship, and therefore does not usually constitute a section 16 violation.33 The Commission’s assessment of the situation at Isla Grande, however, led it to conclude that PRMSA’s refusal to share its cranes was not merely a self-preference. Instead, the Commission found a duality in PRMSA’s role at Isla Grande, and characterized PRMSA as both a terminal operator and a common carrier.34 It then found that PRMSA as terminal operator was preferring PRMSA as common carrier.35 Thus, PRMSA was violating section 16 First.
We find, however, that PRMSA does not function as a terminal operator at Isla Grande. Without this critical conclusion, the Commission’s decision cannot stand. Although a carrier may at times function as a terminal operator,36 PRMSA’s activity at Isla Grande does not present such a situation. PRMSA used its cranes for a purpose incident to its role as common carrier. Its common law and statutory obligations to its shippers include discharging cargo and plac[79]*79ing it on the dock.37 Use of the cranes to fulfill these obligations does not invest PRMSA with terminal status.38 Moreover, the evidence in this proceeding showed, and the Administrative Law Judge held, that PRMSA has never allowed other carriers to use its cranes at Isla Grande to serve their shippers.39 Thus PRMSA has not furnished terminal services to other carriers.
Without a sustainable finding either that PRMSA’s use of its own cranes for the benefit of its shippers constituted terminal operation or that it provided the cranes (and therefore terminal services) to other carriers, the Commission’s conclusion that PRMSA acted as a terminal operator at Isla Grande must depend on its conclusion that the cranes there control the terminal. As we held with regard to the Ports Authority, the Commission’s finding of control is not supported by substantial evidence.
Because PRMSA is not a terminal operator, its refusal to share the cranes at Isla Grande lacks the triangular relationship contemplated by section 16 First. The common carrier PRMSA has thus preferred only itself and has not violated section 16 First.
IV
Section 17 of the Shipping Act, 46 U.S.C. § 816 (1976) prescribes in part that every “common carrier by water in foreign commerce” and every “other person subject to this chapter” shall “establish, observe, and enforce just and reasonable regulations and practices relating to or connected with the receiving, handling, storing, or delivering of property.” The Initial Decision of the Administrative Law Judge, adopted by the Commission in Docket No. 76-41, held that both the Ports Authority and PRMSA had violated section 17. The Ports Authority’s violation resulted from “its failure to establish and enforce just and reasonable regulations concerning assignment of berths and utilization of public areas at Isla Grande in connection with the delivery, handling and storage of property.” PRMSA’s violation resulted from its failure to establish appropriate regulations “concerning secondary utilization of its container cranes and rails located in the public area at Isla Grande.” J. A., at 585. We hold that neither PRMSA nor the Ports Authority has violated section 17.
The relevant provisions of section 17 apply to every “common carrier by water in foreign commerce” and to every “other person subject to this chapter”. Because PRMSA services only routes between the continental United States and Puerto Rico, it is not a common carrier in foreign commerce.40 Therefore, if PRMSA is subject to section 17, it must be an “other person subject to this chapter," which is defined as “any person not included in the term ‘common carrier by water,’ carrying on the business of furnishing terminal facilities in connection with a common carrier by water.” 46 U.S.C. § 801 (1976). Contrary to the Commission’s finding, PRMSA cannot be an “other person subject to this chapter.” PRMSA is clearly a “common carrier by water,” a category specifically excluded from the definition of “other person.” On this basis alone, PRMSA is beyond the purview of section 17. In addition, however, PRMSA is not subject to section 17 because it is not an “other person” by reason of furnishing terminal facilities. As we held with regard to [80]*80section 16 First, PRMSA’s use of its cranes in the context of service to its own shippers does not make it a terminal operator. PRMSA’s refusal to permit secondary use of the cranes by other carriers also negates the conclusion that it provides terminal facilities.
We hold that PRMSA is not subject to section 17 of the Shipping Act. Therefore, we reverse the Commission’s finding of violation as to PRMSA.
The Ports Authority, as a provider of terminal facilities, is clearly subject to section 17 as an “other person subject to this chapter.” Its violation of section 17, the Commission found, stemmed from the failure to establish just and reasonable regulations for the use of Isla Grande terminal, including PRMSA’s cranes. We disagree, particularly in light of our holding that neither the Ports Authority nor PRMSA has violated section 16 with regard to Isla Grande. On the contrary, it would seem that the Ports Authority's refusal to assign to Isla Grande a container carrier unable to work its vessel there is an indication of efficient port management.
In accordance with its responsibility to operate the Port of San Juan for the public good, the Ports Authority must allocate berth assignments to promote full port development and utilization. As we noted above, in early years, when adequate facilities were limited, efficient port management, in the Ports Authority’s judgment, required crane sharing. Now, with a number of berths at Puerto Nuevo remaining under-developed and unprofitable despite huge investments, that sharing is no longer necessary. Indeed, by minimizing the carrier’s incentive to improve a berth suitable for its own operations, the continued requirement of crane sharing may inhibit the development of the Port of San Juan. In tailoring its berth assignments to the needs of the port as a whole, the Ports Authority has initiated a program consistent with the Commission’s own requirements: “As used in section 17 and as applied to terminal practices, we think that ‘just and reasonable practice’ most appropriately means a practice . . . which is fit and appropriate to the end in view.”41 In light of the Ports Authority’s responsibility for the development of the entire port, including the underused Puerto Nuevo area, we hold that the decision not to exact a crane-sharing agreement from PRMSA at Isla Grande is reasonable and does not violate section 17.
The statutory violations found by the Commission in these proceedings are hereby set aside.
It is so ordered.