FIATA calls for urgent dialogue on misdeclaration fines

FIATA calls for urgent dialogue on misdeclaration fines

23 August 2019

Friday, 23 August 2019

Freight forwarder trade federation also seeking clarity on whether financial penalties imposed by shipping lines are limited to dangerous goods


FIATA is calling for urgent dialogue with ocean lines in the wake of recent moves by several leading carriers to impose penalties on shippers who misdeclare cargoes.

Earlier this month, Maersk, Hapag-Lloyd, HMM and OOCL confirmed that they have adopted a practice of charge fines for misdeclarated cargo reaching up to $15,000. According to the shipping lines, the move is an attempt to improve safety and reduce delays whereby up to a quarter of all serious incidents on board containerships are attributable to misdeclared cargo as referenced by the Cargo Incident Notification System initiative.


A spate of fires aboard vessels at sea have been blamed on cargo misdeclarations. Hapag-Lloyd has instituted a penalty of $15,000 per teu for misdeclared cargoes ex- China, effective September 15. It told shippers: “To ensure the safety of our crew, ships and other cargo onboard, Hapag-Lloyd holds the shipper liable and responsible for all costs and consequences related to violations, fines, damages, incidents, claims and corrective measures resulting from cases of undeclared or misdeclared cargoes.” The German carrier saw a fire on board Yantian Express earlier this year, which took weeks to extinguish and is thought to have cost millions of dollars.

South Korea's HMM has also brought in penalties at the same rate, while Hong Kong's COSCO-owned OOCL is introducing fines of unspecified amounts, according to media reports. Maersk  too has brought in a misdeclaration fee, albeit as just one of range of measures that also includes additional cargo screening and knowledge sharing efforts with clients.

Where there is a resort to a financial penalty, fines are assessed on a case-by-case basis, depending on the seriousness of the infraction. In a recent interview with Lloyd’s List, FIATA's acting director general, Stephen Morris, stressed that forwarders are fully supportive of the need for safety at sea, and the lives of seafarers and the protection of shipowners’ property in vessels should rightly be paramount.


However, in reference to the fines, he said: “It’s interesting that they (the 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.”


Another question on which FIATA is seeking clarity is whether the fines apply solely to the misdeclaration of dangerous goods, or any instance in which goods are misdeclared. Morris highlighted the difference between full container load and less than container load consignments. “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.” FIATA has already been in telephone contact with major carriers, requesting a chance to talk over the matter, Morris revealed. “What we are saying is, let’s have some discussion on how we can help you, and we can help our members comply with your (shipping lines) provisions.”

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