Thursday, March 6, 2014

Shipping Line Fined Again after Allegations of Freight Collusion (but they’re not admitting a thing)

It never rains but.......
Shipping News Feature

US – Just a week after being fined $8.9 million by the US Justice Department for price fixing violations, Compañía Sud Americana de Vapores (CSAV) has also reached another costly agreement with the Federal Maritime Commission (FMC) to resolve allegations that it violated the Shipping Act by colluding with other ocean freight carriers on the shipment of vehicles by RoRo or specialised car carrier vessels. The FMC has recently reached similar such agreements with K Line, NYK, and MOL, and its affiliate Nissan Motor Car Carriers, collecting over $3.5 million in penalties from the four carriers.

Under the compromise agreement, CSAV agreed to pay a $625,000 civil penalty but, as with the other accused, did not admit to any violations of the Shipping Act. The Chilean carrier agreed to provide ongoing cooperation with other Commission investigations or enforcement actions with respect to these activities, again as with their predecessors. The compromise also addressed related activities and violations arising under such carrier agreements and Commission staff alleged that these practices persisted over a period of several years and involved numerous US trade lanes. Federal Maritime Commission Chairman Mario Cordero stated:

"The Shipping Act mandates that the Commission take responsible actions to protect the shipping public. Carriers who fail to properly file with the Commission their agreements affecting carrier working relationships in the US trades are made liable for significant civil penalties, no matter the size of the trade or the market share of the carrier involved."

It seems somewhat ridiculous to an impartial onlooker that any company, particularly the giant shipping corporations involved in the cartel enquiries, would be prepared to pay out the millions of dollars involved whilst protesting their innocence by refusing to acknowledge they had indeed violated existing legislation. We await the day when a group is prepared to stand up in Court and settle the matter as to whether these practices, which often in the past were accepted normal business methods, can stand the test of antitrust law as it is viewed today.