The U.S. Federal Maritime Commission (FMC) is again investigating the shipping practices of the Mediterranean Shipping Company, S.A. (MSC). According to FMC’s Order of Investigation and Hearing, MSC is suspected of multiple U.S. Shipping Act violations. These alleged violations include:

• (1) holding parties who did not consent to be bound by its bill of lading liable for detention and demurrage charges;
• (2) misapplying operating reefer rates to non-operating reefer (NOR) shipments;
• (3) failing to publish in its tariff detention and demurrage rates for NORs;
• (4) failing to publish in its tariffs each charge under its control and any rules that in any way change, affect, or determine any part of the total of its rates or charges;
• (5) failing to publish NOR rates; and
• (6) providing transportation that was not in accordance with the rates, charges, classifications, rules, and practices contained in its published tariff.

This is the second FMC investigation into MSC’s alleged unlawful shipping practices since the passage of the Ocean Shipping Reform Act of 2022 (OSRA-22). Earlier this year the FMC initiated an investigation into MSC’s congestion surcharges in response to shipper complaints. A decision in that investigation is expected in early September 2023.

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

The U.S. Federal Maritime Commission (FMC) issued an Industry Advisory to alert the public to Non-Vessel-Operating Common Carriers (NVOCCs) that are not in compliance with FMC’s tariff regulations. The FMC posted the names of 16 NVOCCs that do not publish a tariff, contrary to the Commission’s tariff regulations at 46 C.F.R. § 520.3(a). These NVOCCs are at risk of the Commission taking steps to revoke their licenses or terminate their registration. The FMC announced it will be publishing an updated list of non-compliant NVOCCs each week going forward.

The U.S. Federal Maritime Commission (FMC) received three new formal complaints in August 2023 alleging violations of the U.S. Shipping Act and FMC regulations.

Unreasonable Cargo Handling Practices & Discriminatory Practices – FMC Docket No. 23-06:  Six produce shippers filed a formal complaint against Network Shipping Ltd., Inc., a vessel-operating common carrier alleging various U.S. Shipping Act violations. The shippers allege that Network Shipping violated the U.S. Shipping Act by engaging in unreasonable cargo handling practices and unfair or unjustly discriminatory practices. The shippers include Coast Citrus Distributors d/b/a Olympic Fruit & Vegetable, Amazon Produce Network, LLC, Refin Tropicals, S.A., JW Fresh, S.A., Sembrios de Exportacion Sembriexport, S.A., and Bresson S.A. The shippers allege that they signed service contracts with Network Shipping to transport fresh mangoes from Ecuador to Port Hueneme for the 2021-2022 mango season. Toward the end of 2021 the shippers’ mango shipments experienced severe delays resulting in spoliation due to Network Shipping’s failure to provide chassis. The shippers allege that Network Shipping preferentially allocated available chassis to Del Monte, a competitor produce importer and affiliate of Network Shipping, in violation of the U.S. Shipping Act. As a result, the shippers allege they suffered damages in excess of $2 million.

The shippers request that the Commission investigate the allegations, order Network Shipping to cease and desist from the Shipping Act Violations, order Network Shipping to pay reparations for the unlawful conduct, including interest, attorneys’ fees, and costs, and provide any other further relief that the FMC deems appropriate.

Unreasonable Cargo Practices – FMC Docket No. 23-07:  TIR Auto Transport LLC, a Moldova-based auto buyer and shipper, filed a formal complaint against V&S Brothers Inc., a used car dealer, and V&S Cargo Inc., a U.S.-based non-vessel-operating common carrier (NVOCC) alleging various U.S. Shipping Act violations. TIR Auto alleges that V&S Cargo and its agent V&S Brothers violated the U.S. Shipping Act by engaging in unreasonable cargo handling practices. Specifically, TIR Auto alleges that since 2022 V&S Cargo and its agent V&S Brothers have held several shipments in an effort to extort payment from TIR Auto for alleged debts without providing accounting of such debts. Additionally, V&S Cargo failed to follow TIR Auto’s shipment instructions for several shipments resulting in higher shipping costs. Due to these actions, TIR Auto alleges it suffered direct and consequential damages of $500,000.

TIR Auto requests that the Commission order V&S Cargo and its agent V&S Brothers to pay damages and provide any other further relief that the FMC deems appropriate.

Failure to Provide Services in Accordance with an NSA & Various Other Shipping Act Violations – FMC Docket No. 23-09:  Hubbell Incorporated and its subsidiary HUBS, Inc., a U.S.-based electrical product manufacturer, filed a formal complaint against DSV Air & Sea, Inc., a U.S.-based non-vessel-operating common carrier (NVOCC), and its parent company, DSV Ocean Transport A/S, a Denmark-based NVOCC, alleging various U.S. Shipping Act violations. Hubbell alleges that DSV violated the U.S. Shipping Act by failing to provide service in accordance with an NVOCC Negotiated Service Arrangement (NSA) and engaging in unreasonable cargo handling practices and unfair or unjustly discriminatory practices.

Specifically, Hubbell alleges that in 2022 it sought to sign an NSA that incorporated a Master Service Agreement (MSA) with DSV. DSV failed to sign the NSA and attempted to renegotiate the agreements while still accepting Hubbell’s shipments. Shortly thereafter Hubbell sought to terminate its agreements with DSV due to DSV’s alleged service failures and over $900,000 in overbillings. Following notice of termination, Hubbell received invoices from DSV totaling over $1.67 million for NYSHEX shortfalls. DSV also filed suit in federal court against Hubbell alleging breach of contract. Hubbell alleges the proper venue for the parties’ dispute is the Federal Maritime Commission (FMC) and is seeking to stay the federal proceeding through the filing of this complaint.

Hubbell request that the Commission order DSV to cease and desist from unlawful conduct, pay Hubbell reparations, and provide any other further relief that the FMC deems appropriate.

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

The U.S. Federal Maritime Commission appointed Cindy Hennigan as the agency’s Deputy Managing Director. As Deputy Managing Director, Hennigan will serve as the operating director for the Commission’s administrative functions and as the primary technical advisor to the Managing Director, Lucille Marvin. Hennigan assumed her duties as of August 14, 2023.

“Strong and steady management is key to the Federal Maritime Commission’s effectiveness as a regulatory agency. In her decades of military and federal service, Cindy Hennigan has a proven record of getting things done in the public interest. My fellow Commissioners and I are thrilled she will be joining the Senior Executive Service at the FMC and are grateful for her continued dedication to serving her country,” said FMC Chairman Daniel Maffei.

Hennigan earned a Master of Business Administration from Webster University and a Bachelor of Science Degree from Francis Marion University. She joined the Commission in 2020 to serve as FMC’s Director of the Bureau of Certification and Licensing. Prior to joining the Commission, she worked at U.S. Customs and Border Protection, the U.S. Department of Labor, and the U.S. Small Business Administration. She is a Retired U.S. Army Reserve Major with 25 years of service.

The U.S. Federal Maritime Commission (FMC) requested public comment on the recently issued Maritime Transportation Data Initiative (MTDI) Recommendation and View Report.

The goal of the MTDI is to develop standard terminology and data availability for the shipping industry to expedite the exchange of key data points across the supply chain. FMC Commissioner Carl Bentzel began work on the MTDI in December 2021. To develop the MTDI recommendations, Commissioner Bentzel met with over 80 supply chain participants and engaged with numerous federal agencies including, the U.S. Department of Transportation, U.S. Department of Commerce, the U.S. Department of Agriculture, and the U.S. Department of Homeland Security.

“Make no mistake, supply chain congestion is a constant and continuing inefficiency. Recent pandemic-related congestion costs our Nation trillions of dollars in lost economic opportunity and higher prices, but only highlighted what is in fact an ongoing problem. The recommendations proposed in the MTDI seek to ameliorate what is a system inadequate for providing supply chain transportation. Further public input will help refine what was issued earlier this year,” said FMC Commissioner Bentzel.

Comments on the MTDI recommendations are due October 16, 2023. For detailed comment submission instructions, see the FMC’s Request for Information (RFI) published in the Federal Register.

The Caribbean Shipowners Association (CSA), FMC Agreement No. 010979, recently announced a Peak Season Surcharge (PSS) which will apply from September through January. The CSA Carrier members serve trade lanes between the United States and the Caribbean destinations located in the Leeward/Windward Islands (excluding Guadeloupe, Martinique, Saint Barthelemy, French/Dutch Saint Maarten), Trinidad, Guyana, Suriname, Haiti, the Cayman Islands, the Bahamas, and Jamaica.

See table for the Peak Season Surcharge (PSS) that apply from September 17, 2023 through January 7, 2024.

NOTE 1:  Breakbulk (W/M) means per each 2000 lbs (W) or 40 cft (M).

NOTE 2:  Crowley will apply PSS to/from Jamaica, Tortola, and Virgin Gorda in amounts of USD 250 per 20ft dry container, USD 300 per 20ft reefer container, USD 500 per 40ft per dry container, USD 600 per 40ft reefer container, USD 565 per 45ft container; USD 150 per vehicle; USD 500 breakbulk/NIT.

NOTE 3:  King Ocean will apply PSS between U.S. Ports and Points and the Eastern Caribbean including Guyana and Suriname in amounts of USD 250 per 20ft dry container, USD 300 per 20ft reefer container, USD 500 per 40ft per dry container, USD 600 per 40ft reefer container, USD 565 per 45ft container; USD 150 per vehicle not exceeding 700 cft; USD 250 per truck or trailer; USD 12 per W/M for breakbulk; USD 0.25 per CFT; USD 0.50 per CWT; USD 3.75 per barrel; USD 20 per pallet.

NOTE 4:  Seaboard Marine will apply USD 10.50 per W/M for breakbulk, and USD 5.30 per W/M for LCL/breakbulk, Minimum USD 5, for the Cayman Islands.

NOTE 5: Tropical Shipping & Construction will apply USD 250 per vehicle not exceeding 700 cft; USD 12 per W/M for vehicle exceeding 700 cft; USD 12 per W/M for breakbulk; USD 0.30 per CFT; USD 0.60 per CWT; USD 4.69 per barrel; USD 25 per pallet.  For the Cayman Islands, Tropical will apply USD 125 per vehicle not exceeding 700 cft; USD 6.25/WM for vehicle exceeding 700 cft; USD 6.25 per W/M for breakbulk; USD 0.16 per CFT; USD 0.32 per CWT; USD 2.34 per barrel; USD 12.50 per pallet.

See table for the current Bunker charges.

NOTE 1: Amounts differ for W/M and vehicle units.

NOTE 2: King Ocean announced the Bunker Adjustments for the Eastern Caribbean including Suriname and Guyana, effective June 18, 2023.  King Ocean also announced amounts USD 0.27 per M, USD 0.54 per W, USD 7.92 per D-Container, USD 2.14 per E-Container, USD 1.85 per EH-Container and Barrels, USD 3.34 per 36 Box.

NOTE 3: Seaboard Marine has also published amounts for Bunker Charges for the Caribbean in the amount of USD 11.30 per W/M for less-than-container load and breakbulk, USD 108 for vehicle not exceeding 750 cft, USD 11.30 per W/M for vehicle exceeding 750 cft.  The other amounts for the Cayman Islands are USD 7.93 per W/M for less-than-container load and breakbulk, USD 138 for vehicle not exceeding 750 cft, USD 7.93 per W/M for vehicle exceeding 750 cft.

NOTE 4: Tropical Shipping & Construction will apply USD 225 per vehicle not exceeding 700 cft; USD 11.25 per W/M for vehicle exceeding 700 cft; USD 11.25 per W/M for breakbulk; USD 0.28 per CFT; USD 0.56 per CWT; USD 4.22 per barrel; USD 22.50 per pallet.  For the Cayman Islands, Tropical will apply USD 165 per vehicle not exceeding 700 cft; USD 8.25 per W/M for vehicle exceeding 700 cft; USD 8.25 per W/M for breakbulk; USD 0.21 per CFT; USD 0.42 per CWT; USD 3.09 per barrel; USD 16.50 per pallet.

CSA members are Seaboard Marine Ltd., Tropical Shipping & Construction Company Limited, LLC, King Ocean Services Limited, Inc., Crowley Caribbean Services LLC, Hybur Ltd., and Seacor Island Lines LLC. For more information see individual carrier tariffs.

Several carriers serving the USA/East Asia trade lanes (U.S. Exports) have adjusted their fuel surcharges for the October to December 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. 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). HMM also filed in its FMC tariff Rule 10-02F, Environmental Compliance Charge (ECC), effective October 1, 2023. The ECC since April 1, 2023 amounts are USD 50/100/100/100 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.

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

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 carriers serving the East Asia/USA trade lanes (U.S. Imports) have adjusted fuel surcharges effective October 1 through December 31, 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. 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 October 1, 2023. The ECC amounts are USD 260/289/325/366 per 20/40/40HC/45ft, respectively, for destination USWC/USWC Local/IPI/MLB; and USD 468/520/585/659 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.

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 September 15, 2023, including CMA CGM, COSCO, Evergreen, Hapag Lloyd, HMM Company Limited, Ocean Network Express (ONE), Yang Ming, and ZIM. See table below for GRI amounts per 40ft container. GRI amounts for all other container sizes are as per formula. The September 15th GRIs will be the eighteenth 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.

NOTE 3:  Evergreen GRIs will be USD 1000 per 40ft container for dry cargo, and USD 1000 per reefer container. GRI amounts for all other container sizes are as per formula.

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

NOTE 3:  Evergreen GRIs will be USD 1000 per 40ft container for dry cargo, and USD 1000 per reefer container. GRI amounts for all other container sizes are as per formula.

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.