More Fines for NVOCCs as Federal Regulator Gets Tough on Rate Cheats

US – The Federal Maritime Commission (FMC) has recovered a total of $950,000 in civil penalties after completing several compromise agreements with eight non-vessel-operating common carriers (NVOCCs) and an unlicensed entity. The agreed penalties resulted from investigations conducted by the Commission's Area Representatives in New York, Seattle, and South Florida, and by Washington D.C. headquarters staff, and as is usually the case, the parties settled and agreed to penalties, but did not admit to violations of the Shipping Act or Commission regulations.

The Respondents and the alleged violations are:

Brilliant Group Logistics – an NVOCC based in Valley Stream, New York. Between October 2014 and April 2015, the company is alleged to have knowingly and wilfully obtained transportation at less than the rates and charges that would otherwise apply by the device or means of improperly utilising rates limited to certain named accounts in its service contracts. Between January 2015 and February 2015, alleged to have provided liner transportation that was not in accordance with the rates and charges set forth in its published tariff or in any non-tariff alternative authorised by the FMC regulations. Prior to July 29, 2016, Brilliant operated without a Qualifying Individual for a period in excess of one year. Brilliant Group Logistics paid $100,000 in penalties to settle the charges.

King Freight (USA) – an NVOCC in Cerritos, California. Between June 2014 and November 2015, King Freight are to have knowingly and wilfully obtained ocean transportation for property at less than the rates or charges that would otherwise be applicable by the device or means of improperly utilising rates limited to certain named accounts in its service contracts, and provided service that was not in accordance with the rates or charges contained in its NVOCC tariff. King Freight agreed to pay a fine of $90,000 to settle the allegations.

Interglobo North America – a Jersey City, New Jersey, based NVOCC. Interglobo knowingly and wilfully obtained ocean transportation for property at less than the rates and charges that would otherwise be applicable by the device or means of improperly utilising rates limited to certain named accounts, between November 2014 and December 2016. The company also provided transportation in the liner trade that was not in accordance with the rates and charges set forth in its published tariff or any non-tariff alternative authorised by the Commission’s regulations. Interglobo paid a fine of $150,000 in compromise of these allegations.

Fastic Transportation – a Shanghai, China based NVOCC. Fastic are alleged to have knowingly and wilfully obtained ocean transportation for property at less than the rates or charges that would otherwise be applicable by the device or means of improperly utilising rates limited to certain named accounts in its service contract. During that time, Fastic provided service that was not in accordance with the rates or charges contained in a published tariff or any non-tariff alternative authorised by the Commission’s regulations. Fastic were penalised $110,000.

Pudong Prime International Logistics – an El Monte, California based NVOCC. Commission staff allege that between December 2014 and January 2017, Pudong Prime knowingly and wilfully obtained ocean transportation for property at less than the rates and charges that would otherwise be applicable by the device or means of improperly utilising rates limited to certain named accounts. Pudong Prime also provided transportation in the liner trade that was not in accordance with the rates and charges set forth in its published tariff or any non-tariff alternative authorised by the Commission’s regulations. The FMC levied a $100,000 fine against Pudong Prime.

Seamaster Logistics – an NVOCC based in Diamond Bar, California. Between March 2012 and August 2014, Seamaster are alleged to have allowed another NVOCC access to certain service contracts for a fee. The competitor was neither a signatory nor a named affiliate and thereby obtained ocean transportation for property at less than the rates or charges that would otherwise be applicable. During that time, Seamaster also provided services in a liner trade as an NVOCC to shippers that were not in accordance with the rates and charges published in their tariffs or in non-tariff alternatives permitted by the Commission’s regulations. Seamaster paid a $275,000 penalty to settle the allegations.

Toll Global Forwarding (Hong Kong) – an NVOCC based in Hong Kong. Toll also provided the same competitor NVOCC access to certain services contracts within the same time-frame, and provided services in a liner trade as NVOCC to shipper that were not in accordance with the rates and charges published in their tariffs or non-tariff alternatives permitted by the Commission's regulations. Toll paid a fine of $275,000 in compromise to settle the allegations.

Pacific International Import Export – based in Auburn, Washington. The commission alleged that Pacific acted as an NVOCC without a license, evidence of financial responsibility, or a published tariff. The commission fined the company $30,000 to settle the alleged violation which occurred between May 2012 and January 2016.

A-Sonic Logistics – a Licensed NVOCC in Valley Stream, New York. Between May 2015 and 2016, the company are alleged to have knowingly and wilfully accepted cargo from one or more ocean transportation intermediaries that did not have a published tariff, bond or other surety as required by the Shipping Act. It was also alleged that A-Sonic provided transportation that was not in accordance with the rates and charges set forth in its published tariff. The company was fined $70,000 to settle the allegations.