FMC fines MSC millions for Shipping Act violations

The probe alleged that MSC violated the Shipping Act over the course of several years. The first, which occurred from 2018-2020, related to MSC’s billing of customs agents for demurrage and detention charges, or late fees, even though the agents were not involved in moving the cargo. The FMC affirmed an earlier decision of an Administrative Law Judge. The civil penalties for these violations totaled $65,000.

The investigation also affirmed an ALJ finding that MSC failed to include in its published tariff from 2021-2023 late fees for non-operating reefers (NORs). The agency modified the initial decision to reflect knowing and willful violations starting only from the point of MSC’s March 2022 statement to the Commission that it would modify its tariff. The penalties for those violations totaled $9.46 million.

In the third instance BEIC alleged that MSC overcharged its customers demurrage and detention fees for use of said reefers. The Commission reversed the ALJ’s determination that MSC’s NORs “billing system” mistake did not violate a portion of the Act, but held that overcharges occurred in about 23% of all NOR bills during the entire year of 2021. 

“Therefore, the Commission concluded that MSC’s billing was not merely the result of a mistake but rather that it constituted an unreasonable practice within the meaning” of the Act. It assessed a penalty of $5,000 per violation, or a total of $13.145 million.

Find more articles by Stuart Chirls here.

Related coverage:

Maersk posts Q4 pre-tax loss, will cut 1,000 jobs

Panama targeted Canal ports contract, China company claims

Carriers say military to secure Red Sea voyages

Leaner inventories weaken ocean demand, a harbinger for higher tender rejections, increased truck rates