The U.S. Federal Maritime Commission (FMC) announced that Ocean Network Express Pte. Ltd. (ONE) will pay a $1.7 million civil penalty to settle allegations of U.S. Shipping Act violations. Specifically, the FMC alleged that ONE wrongly assessed detention charges when appointments were unavailable during allocated free time to return equipment.

As part of the agreement, ONE also agreed to provide restitution to impacted shippers in the form of refunds and waivers. The amount of restitution was not disclosed. ONE did not admit to any violation of law.

This compromise brings the total paid in civil penalties to the FMC for alleged detention and demurrage violations to $4.65 million. Two other major ocean common carriers recently paid civil penalties for similar alleged violations.

In June 2022, Hapag-Lloyd AG agreed to pay $2 million in civil penalties to resolve allegations it wrongly assessed detention charges in violation of the U.S. Shipping Act. In April 2023, Wan Hai Lines agreed to pay $950,000 in civil penalties to resolve similar allegations.

Civil penalties are paid directly to the General Fund of the U.S. Treasury. The FMC does not receive any revenue when assessing civil penalties.

The U.S. Federal Maritime Commission (FMC) Chairman Daniel Maffei announced that John G. Crews, II was hired as the Director of the Bureau of Enforcement, Investigations, and Compliance (BEIC) effective May 2023.

Crews is the first person to serve as BEIC Director. In his role, he will supervise and coordinate the personnel and activities of the Bureau’s three subordinate Offices of Enforcement, Investigations, and Compliance that comprise the Commission’s enforcement program.

“The Commission is fully committed to meaningful and effective enforcement of its statutes. I am confident Mr. Crews will provide effective leadership of BEIC and his efforts will be instrumental in achieving deterrence through enforcement,” said Chairman Maffei.

Crews assumes his duties at the Commission following six years of service as a U.S. Immigration Judge. He previously worked as an Attorney Advisor at the U.S. Department of Justice, an Assistant U.S. Attorney, a law clerk to a U.S. District Judge, and a city police officer.

Crews earned his Juris Doctor from Southern Methodist University and his Bachelor of Liberal Studies from Boston University. He is a member of the State Bar of New Mexico.

The U.S. Federal Maritime Commission (FMC) met on May 3, 2023 to discuss the Commission’s new enforcement structure and implementation of the Ocean Shipping Reform Act of 2022 (OSRA-2022).

At the meeting, FMC staff reported on enforcement activity and announced its new regionally based structure for its investigatory program. In Fiscal Year 2022, the newly formed Bureau of Enforcement, Investigations, and Compliance executed 191 investigations, 204 enforcement matters, 59 compliance matters, and three formal enforcement proceedings. The FMC reported that the overwhelming majority of this activity focused on ocean carriers and marine terminal operators.

The new regional organization for BEIC investigatory staff was also unveiled at the meeting. Under the new structure, investigators will be positioned in the following strategic locations to be closer to regulated entities.

This new regional organization will support the Commission’s recent delegation of enforcement authority to the BEIC.

FMC staff also reported on the implementation of OSRA-2022. Commission staff reported that they are working to complete the Final Rule on Demurrage and Detention Billing Requirements and the rulemaking to address Unfair or Unjustly Discriminatory Methods. Both rulemakings are due by June 16, 2023.

FMC staff are also working on a Supplemental Notice of Proposed Rulemaking (SNPRM) on Unreasonable Refusal to Deal or Negotiate with Respect to Vessel Space. This rulemaking was due in December 2022, but has been delayed to allow the FMC additional time to consider public comments received in response to the proposed rulemaking.

The date of the Commission’s next meeting has not been announced.

The U.S. Federal Maritime Commission (FMC) recently announced that it will collect weekly reports on the location of empty shipping containers from the top 12 ocean carriers. The FMC will use this data to publish a weekly report on the availability of containers at key locations. The report will include the container types and sizes available at 30 intermodal locations.

The Ocean Shipping Reform Act of 2022 (OSRA-2022) mandated new data collections and reporting for federal agencies. The new reporting is intended to address key gaps in supply chain data visibility. The FMC was instructed to collect and report on vessel-level tonnage as well as full and empty containers entering and leaving U.S. ports in international trade. The U.S. Department of Transportation’s Bureau of Transportation Statistics (BTS) was instructed to collect operational data on intermodal equipment and dwell times. Both agencies have work underway on these data collections.

Comments on the proposed data collection are due by July 24, 2023. The public may submit comments by email to FMC Managing Director Lucille Marvin at omd@fmc.gov. For more information see the complete Federal Register notice.

The U.S. Federal Maritime Commission (FMC) received one new formal complaint in May 2023 alleging violations of the U.S. Shipping Act and FMC regulations.

Unreasonable Cargo Practices & Various Other Shipping Act Violations – FMC Docket No. 23-03:  CertiFit Inc., a U.S.-based auto-body parts importer, filed a formal complaint against Evergreen Shipping Agency (America) Corp. as agent for Evergreen Line. CertiFit alleges that Evergreen violated various provisions of the U.S. Shipping Act. Specifically, CertiFit alleges that in 2020 and 2021, Evergreen systematically failed to provide space under CertiFit’s service contract. As a result, CertiFit was forced to secure shipping space for higher rates and lower service levels on the spot market.

CertiFit alleges damages of at least $750,000. CertiFit requests that the Commission order Evergreen to pay CertiFit reparations for the unlawful conduct, including interest, attorneys’ fees, and costs, order Evergreen to cease and desist from the unlawful conduct, and provide any other further relief that the FMC deems appropriate.

This is the second formal complaint against Evergreen for alleged service contract failures during the COVID-19 pandemic. The prior complaint, brought by a tire importer, was settled for an unknown amount in May 2022 under Docket 22-05.

For more details visit FMC’s online reading room. The FMC’s reading room provides access to FMC dockets, related documents, notices, and orders.

Several carriers serving the East Asia/USA trade lanes (U.S. Imports) have adjusted fuel surcharges effective July 1 through September 30, 2023. Here is a table of BAF amounts posted by carriers:

NOTE 1:  CMA CGM calls the above surcharge the Bunker Adjustment Factor Surcharge (BAF03), Tariff Rule No. 010.08. These Bunker amounts have been effective since April 1, 2023. Low Sulphur Surcharge IMO2020 (LSS20) is not applicable at this time.

NOTE 2:  COSCO calls the above surcharge the Bunker Charge (BUC), Tariff Rule No. 010-003.

NOTE 3:  HMM calls the above surcharge the Bunker Charge, Tariff Rule No. 2-63. HMM also filed in its FMC tariff Rule 2-95, Environmental Compliance Charge (ECC), effective July 1, 2023. The ECC amounts are USD 160/178/200/225 per 20/40/40HC/45ft, respectively, for destination USWC/USWC Local/IPI/MLB; and USD 288/320/360/405 per 20/40/40HC/45ft, respectively, for destination USEC (all water)/USGC/RIPI.

NOTE 4:  ONE calls the above surcharge the ONE Bunker Surcharge (OBS). Any reference to Bunker Adjustment Factor (BAF) or Fuel Adjustment Factor (FAF) within a duly filed service contract shall be construed as referencing the same surcharge as ONE Bunker Surcharge (OBS) as detailed within Tariff Rule No. 102.001, whether as an exception or as a reference to this charge.

NOTE 5:  OOCL calls the above surcharge the Fuel Cost Recovery Charge (T-62). The Fuel Cost Recovery Charge will not apply to shipments when Bunker Surcharge and/or Low Sulphur Fuel Surcharge and/or Low Sulphur Adjustment Charge are already applied or included in the base rate. These Bunker amounts are effective June 1, 2023 until further notice.

NOTE 6:  ZIM calls the above surcharge the New Bunker Factor – Far East (NBF), Rule No. 010-NB. Service contract cargoes subject to Carrier’s published BAF and/or EBS shall not be subject to NBF.

NOTE 7:  Subject to Low Sulphur Fuel Charge (LSF or LSS).

NOTE 8:  Updated on a monthly basis.

Each carrier maintains its own tariffs and controls its own pricing.

Several leading carriers serving the Transpacific container trades have recently updated their respective tariffs to include new General Rate Increases (GRIs) effective June 15, 2023, including CMA CGM, COSCO, Evergreen, Hapag Lloyd, HMM Company Limited, Ocean Network Express (ONE), and ZIM. See table below for GRI amounts per 40ft container. GRI amounts for all other container sizes are as per formula. The June 15th GRIs will be the twelfth GRI of 2023 for the East Asia/USA trade lane.

NOTE 1:  CMA CGM GRIs will be USD 1000 per 40ft container for dry cargo, and USD 1125 per 40ft container for reefer cargo. GRI amounts for all other container sizes are as per formula.

NOTE 2:  COSCO GRIs apply on all cargo moving under service contracts only.

Some carriers also updated their tariffs to include new General Rate Increases (GRIs) effective July 1, 2023, including CMA CGM, COSCO, Evergreen, Hapag Lloyd, HMM Company Limited, Ocean Network Express (ONE), and ZIM. See table below for GRI amounts per 40ft container. GRI amounts for all other container sizes are as per formula. The July 1st GRIs will be the thirteenth GRI of 2023 for the East Asia/USA trade lane.

NOTE 1:  CMA CGM GRIs will be USD 1000 per 40ft container for dry cargo, and USD 1125 per 40ft container for reefer cargo. GRI amounts for all other container sizes are as per formula.

NOTE 2:  COSCO GRIs apply on all cargo moving under service contracts only.

Each carrier maintains its own tariffs and controls its own pricing.

Several carriers serving the USA/East Asia trade lanes (U.S. Exports) have adjusted their fuel surcharges for the July to September 2023 quarter. Here is a table of carriers that have posted BAF amounts:

NOTE 1: CMA CGM calls the above Bunker surcharge the Bunker Adjustment Factor Surcharge (BAF-03), tariff Rule No. 010.4. These Bunker amounts have been effective since April 1, 2023. Low Sulphur Surcharge IMO2020 (LSS20) is not applicable at this time.

NOTE 2:  COSCO calls the above surcharge the Bunker Surcharge (BUC), Tariff Rule No. 010-001.

NOTE 3: MM calls the above charge the Bunker Surcharge (BUC) Rule No. 10-02A and has been in effect in the FMC tariff since April 1, 2023. HMM also filed in its FMC tariff Rule 10-02F, Environmental Compliance Charge (ECC), effective since April 1, 2023. The ECC since April 1, 2023 amounts are USD 43/85/85/85 per 20/40/40HC/45ft, respectively, for dry cargo moving via West Coast; and USD 33/65/65/65 per 20/40/40HC/45ft, respectively, for dry cargo moving via East Coast, Gulf.

NOTE 4:  ONE calls the above surcharge the ONE Bunker Surcharge (OBS). Any reference to Bunker Adjustment Factor (BAF) or Fuel Adjustment Factor (FAF) within a duly filed service contract shall be construed as referencing the same surcharge as ONE Bunker Surcharge (OBS) as detailed within Tariff Rule No. 102.001, whether as an exception or as a reference to this charge.

NOTE 5:  OOCL calls the surcharge the Fuel Cost Recovery Charge (T-62). The Fuel Cost Recovery Charge will not apply to shipments when Bunker Surcharge and/or Low Sulphur Fuel Surcharge and/or Low Sulphur Adjustment Charge are already applied or included in the base rate. These Bunker amounts are effective June 1, 2023 until further notice.

NOTE 6:  ZIM calls the above Bunker Charge the New Bunker Factor – Far East (NBF), Rule 010-NB. These Bunker amounts are effective June 1, 2023 until further notice.

NOTE 7:  Subject to Low Sulphur Fuel Charge (LSF or LSS).

NOTE 8:  Updated on a monthly basis.

Each carrier maintains its own tariffs and controls its own pricing.

The information contained herein is obtained from reliable sources. It is subject to change at any time, however, depending on changes in laws and regulations. While we continually attempt to monitor this information, we do not guarantee its accuracy and are not responsible for any damages suffered by any party in reliance on it.