ESC CHALLENGES FEFC IMPOSED WAR RISK INSURANCE SURCHARGE

ESC CHALLENGES FEFC IMPOSED WAR RISK INSURANCE SURCHARGE    The European Shippers' Council has asked the Far Eastern Freight Conference to justify the level of war risk insurance surcharges that the conference has imposed.
   Members of the ESC are concerned that surcharges passed on to shippers do not reflect the actual charges that FEFC member shipping lines are incurring.
   The ESC has called on the FEFC to justify their actions and to make known their calculations for these additional charges with maximum transparency.
   “The ESC is disappointed by the lack of transparency offered by the shipping lines at the present time. In this situation shippers may well be forced to take appropriate action with their carriers.” Said Nicolette van der Jagt from the European Shippers' Council. “It has now become clear that FEFC surcharges are not equivalent to the underlying insurance premiums.”
   The ESC claims the FEFC is levying a $10-per-TEU surcharge on transit of the Suez Canal, approximately 133 percent of the $4.33 per TEU the carriers are paying their respective underwriters.
   The conference said it is receiving increases in other costs, but the ESC argues that the conference has failed to adequately explain or justify those other costs.