Thursday, August 6, 2015

Maritime Commission Fines NVOCCs

By Mark Edward Nero

The Federal Maritime Commission on Aug. 4 completed compromise agreements with six shipping companies, including one on the West Coast, for violations of the Shipping Act mostly involving rates violations.

The Maritime Commission said it’s recovering a total of $1.2 million in civil penalties from six non-vessel-operating common carriers (NVOCCs) and one vessel-operating common carrier (VOCC).

The penalties, according to the FMC, are a result of investigations conducted by the commission’s area representatives in Seattle and New York, as well as headquarters staff in Washington, DC. The parties settled and agreed to penalties, but did not admit to violations of the Shipping Act or the commission’s regulations.

The sole West Coast shipper involved in the settlements was Hyundai Logistics USA, an NVOCC and freight forwarder based in the Los Angeles County city of La Mirada, California. The FMC alleged that Hyundai Logistics violated the Shipping Act by knowingly and willfully obtaining transportation at less than applicable rates by improperly allowing third parties to access service contracts to which Hyundai Logistics (USA) was the contract signatory.

Under the terms of the compromise, respondent made a payment of $100,000.

The other companies that the FMC reached settlements with were: United Arab Shipping Co. of Dubai; China-based City Ocean Logistics; Oriental Logistics Group (Taiwan); Falcon Maritime & Aviation (New York); and Sea Gate Logistics (New York).

Each was fined from $80,000 to over $537,000 for shipping rates violations.

“The compromise agreements demonstrate how serious we are about protecting the international shipping marketplace from fraud and threats to cargo security, and in our commitment to shield the many lawful participants in international trade from commercial deception and other unlawful trading practices,” FMC Chair Mario Cordero said.