Ocean Network Express (ONE) and Wan Hai Lines have agreed to pay $2.65m to the Federal Maritime Commission (FMC) to resolve claims relating to demurrage (D&D) fees and refunds to shippers. These settlements were separate from complaints filed by individual shippers against several carriers. The Commission has been vocal about overcharging shippers. Before the Ocean Shipping Reform Act was passed in 2022, the Commission issued guidelines to shipping companies and terminals on their charging practices. D&D fees were one of the issues that became one of the drivers of reform following shippers’ complaints.
Daniel Maffei, Chairman of the Federal Maritime Commission, commended the Bureau for transportation, Investigations, and Compliance, calling the results “significant civil penalties and relief for affected shippers.” ONE settled a few months ago with the FMC and agreed to pay a $1.7m civil penalty. The settlement relates to the FMC’s investigation into determining prison terms when appointments were not available when returning equipment. The FMC had not initiated a formal enforcement action against ONE. The settlement reached with ONE includes a clause where the carrier agrees to provide refunds and waivers to affected shippers in addition to paying civil penalties.
Wan Hai agreed to pay $950,000 in civil penalties and reimbursed affected shippers for any detention fees charged in their invoices. In addition to paying a civil penalty, the shipping line has corrected its practices to prevent future violations. The FMC concluded that Wan Hai did not follow and enforce equitable and fair practices in relation to its fees for the return of empty containers.
The FMC is expected to rule on elements of the reform bill in relation to the business practices and fees of airlines and terminals, and many have revised their policies and procedures in anticipation. Common complaints from shippers include unavailability of container returns, inaccurate return times, and charges being made on days when container returns are unavailable, such as public holidays. Before the ONE and Wan Hai settlements, Hapag-Lloyd said it had paid $2m in civil penalties to address allegations arising from assessment of the detention allegations.
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