FMC orders MSC to justify congestion charges

Shipping containers of Evergreen and MSC, and tank containers in Port of Duisburg, Germany. Port of Duisburg is the largest inland port in the world.

The Federal Maritime Commission (FMC) has called on Mediterranean Shipping Co (MSC), the largest container line in the world, to justify a congestion surcharge levied against a US business.

The FMC is disputing a congestion fee of $1000 that MSC charged SOFi Paper Products after the American firm lodged a complaint with the regulator.

According to an FMC report, MSC never “justified” to SOFi a $1,000 “congestion fee” imposed on SOFi in July 2022.

As a result, MSC must justify its decision to the FMC as to why it should not be ordered to refund or waive charges levied against SOFi by 28 February. 

MSC has not yet provided a justification for the carrier’s charge due to the congestion at US ports of discharge.

READ: MSC boxship refloated after grounding in Singapore Strait

The Ocean Shipping Reform Act (OSRA) 2022, signed into law by President Biden last June, grants the FMC greater discretion and authority over foreign-flagged carriers business operations on US waters. 

Among these powers includes the authority to receive and streamline the process of handling charge complaints. 

This provision stipulates that unfair or unjust actions by a common carrier, with respect to charges, may constitute a violation to the Act. 

If the FMC determines that a charge does not comply with the provision, the FMC shall “promptly” order the refund of charges paid or waiver of charges imposed. 

The OSRA also authorises the FMC to issue a civil penalty to the carrier levying such a charge if found guilty of breaching the provision.

READ: MSC opens up north Indian market with Sentosa expansion

The charge complaint provision of the statute has been effective thus far. 

The FMC reported receiving more than 200 submissions since the law’s adoption in June, including 70 that have met the requirement for referral to investigators. 

Since June, carriers have reportedly repaid more than $700,000 in charges, according to commission staff estimates.

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