Wednesday, August 28, 2019

International Freight Forwarding Lobby Questions Penalties for Misdeclared Cargoes

Dangerous Goods in the Spotlight but the Ability to Penalise Shippers Queried
Shipping News Feature
SWITZERLAND – WORLDWIDE – The recent announcement from major ocean container shipping lines including Maersk, Hapag-Lloyd, Hyundai Merchant Marine (HMM)and OOCL that they will henceforth 'fine' those shippers which misdeclare cargo prompted an immediate response from the International Federation of Freight Forwarders Associations (FIATA) which called for discussions to clarify the matter.

The lines’ decision to penalise shippers up to $15,000 was taken after a series of incidents, including serious fires aboard several vessels, appearing to be the result of hazardous cargoes being misdeclared. As referenced by the Cargo Incident Notification System (CINS) initiative, up to 25% of all serious incidents on board containerships are attributable to misdeclared cargo.

Whilst it fully agrees that safety at sea, and the lives of seafarers and the protection of ship owners’ property in vessels should rightly be paramount, FIATA wants to know whether the fines apply solely to the misdeclaration of dangerous goods, or any instance in which goods are misdeclared. Acting Director General Mr Stephen Morris has already had discussions with some of the lines, pointing out the anomalies of FCL and LCL freight, commenting:

“If you’re stuffing a container with a variety of other people’s goods, you don’t know the condition of those goods and whether the goods in that container are properly described on the documentation, or whether those goods are compatible in terms of creating a chemical reaction.

“It’s interesting that they (shipping lines) talk about fines, because I don’t think that in the private sector you can fine people. Usually fines relate to regulators and law enforcement agencies.”

Maersk have introduced a new mandatory checkbox which asks shippers when booking freight to confirm that all cargo is correctly declared, safely stuffed in the box and agrees to Maersk inspection, in addition to detailed declarations stating either:

  • If non-hazardous the goods in the booking are NOT classified as Dangerous Good, are safe for carriage by sea and packed and loaded in accordance with the current Code of Practice for Packing of Cargo Transport Units.
  • If classified as dangerous goods they are declared correctly in accordance with the requirements, definitions and/or classifications in the current International Maritime Dangerous Goods Code, are safe for carriage by sea and packed and loaded under the same terms as general dry cargo.
It will be interesting to see how this develops, particularly when the first case is prosecuted by the shipping line involved, assuming it becomes public knowledge. FIATA may well be correct in that the companies have no legal power to enforce the penalties. However morally the ‘fines’ would appear well justified given the litany of tragedies associated with reckless misdeclaration, particularly for goods coming out of the Far East, and one assumes that sanctions could include a blanket ban on individual shippers or products coming from any one quarter, enforced by all the carrying agencies.

Photo: The Hyundai Fortune on 21 March 2006, whilst en route to Europe from China, saw an explosion in the container stacks blow dozens of boxes into the water and start a serious fire after misdeclared petroleum based cleaning fluid ignited setting off seven containers containing fireworks. The shipper had allegedly been trying to avoid the extra cost associated with dangerous goods carriage.