2019 Aug 23

Time to ‘name and shame’ rogue DG shippers

Moves by carriers to fine shippers for failing to correctly declare hazardous cargo is unlikely to change the behaviour of the criminally minded, with other measures needed in response to rising numbers of containership fires, according to container shipping analyst Drewry.

Following another containership fire this month, Drewry said it was now “time to name and shame rogue shippers that threaten the safety of the supply chain”, adding: “If governments won’t or can’t do more to assist with container checks, they can at least give shipping lines more tools to do it themselves, such as allowing some sharing of information on habitual criminals.”

Although there were no fatalities when a blaze occurred in the aft section of the APL Le Havre (10,106 teu) on Friday 9 August off the Indian west coast, the list of similar incidents “is growing at an alarming rate and carriers are starting to roll out fines in a bid to improve matters”, Drewry noted. “While the cause of the fire is still being investigated, the latest incident is the eighth this year alone involving a ship carrying containers, well above the 60-day average for major fires cited earlier this year by TT Club, a transport and logistics insurer.”

It noted that over a quarter of all liner fires reported to the Cargo Incident Notification System (CINS) relate to misdeclared cargoes, particularly of the hazardous kind. “It is an age-old problem that has blighted shipping for too long: rogue shippers wilfully breaking the rules to avoid freight rate and insurance premiums on dangerous goods, or committing customs fraud by declaring high value goods as more common items,” Drewry added.

The invention of the steel container made it even easier to conceal such fraudulent activity, leaving shipping lines with an uphill challenge to combat it.

“Numerous initiatives have been tried, but the problem persists,” Drewry noted. “For example, Hapag-Lloyd’s ‘Cargo Patrol’ software programme has, since 2011, searched all bookings made with the company to identify potentially dangerous or suspicious items, while Maersk Line has introduced a random container check pilot in four US terminals, following the tragic fire on the 15,000-teu Maersk Honam in March 2018 that claimed the lives of five crew members.”

TT Club is spearheading a broad ‘Cargo Integrity’ campaign that aims to draw attention and offer best-practise guidance to all stakeholders to not only misdeclared shipments, but other problem areas such as container weighing and packing. It also seeks greater regulatory assistance with very few IMO member states bothering to submit container inspection reports, Drewry noted.

With the number of container fires rapidly escalating, a few carriers last week announced that they would levy penalties on shippers for misdeclaring cargoes. Hapag-Lloyd, which last year shipped nearly half a million dangerous goods, will from 15 September fine shippers $15,000 for undeclared or misdeclared hazardous cargoes. HMM will fine the same amount, while Evergreen announced a penalty of $35,000, the analyst highlighted

OOCL said that it is tightening its dangerous cargo acceptance with an additional verification step.

“More carriers are likely to follow the lead; but while the threat of financial punishment might help to correct the behaviour of the less wilfully negligent shippers, it is unlikely to change the attitude of any rogue shipper who will still bet on evading the net,” Drewry said.

“One approach that might help eradicate the criminal element would be to introduce shipper blacklists, but anti-trust laws do not currently allow for that. Carriers can log incorrect shipments with CINS, but they are not permitted to identify the shipper – meaning they can simply try their luck with another line if they get rejected by the first carrier.”

It concluded: “It is an unfortunate consequence of the current competition laws that they prevent a limited amount of information sharing that could greatly enhance safety and reduce fraud. Most law-abiding shippers would surely welcome any measure that will help reduce the risk of their cargoes being delayed or destroyed by the irresponsible action of others.”


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