Carriers Won’t Hold US Exporters Responsible for Container Weight

http://www.joc.com/regulation-policy/transportation-regulations/international-transportation-regulations/carriers-wont-hold-us-exporters-responsible-container-weight_20160321.html

Ocean carriers are telling exporters that even though they are required to provide a single, certified weight for containers that includes the weight of the container itself, exporters are not legally responsible for verifying the weight of the container.

“It is acceptable for shippers to rely upon the tare weight being made available by the ocean carrier. The shipper would not be certifying the accuracy of the container tare weight printed on the container,” said a unanimously approved statement issued on Monday by the 18 carrier members of the Ocean Carrier Equipment Management Association or OCEMA.

The carriers’ position on tare weights, developed over the past few months, addresses a core complaint of U.S. exporters, which is that they are being required under a new Safety of Life at Sea amendment that takes effect on July 1 to certify the weight of an object — that is, the container itself — they neither own nor control. The statement was contained within a larger set of best practices for all parties in the U.S. trades — carriers, terminal operators and shippers — to use when preparing for implementation. But the proposed guidelines still would require the shipper to provide a Verified Gross Mass which includes the tare weight of the container, and that doesn’t go far enough for exporters who want to continue to provide only the weight of the cargo as they do today.

Under the SOLAS Verified Gross Mass rule, the shipper must certify with an electronic or hard copy signature the full packed weight of each container it ships and provide the VGM to the container line and terminal operator far enough in advance for it to be used in stowage planning. Under the SOLAS amendment, the exporter can arrive at the VGM by Method 1, which is weighing the fully loaded container, or Method 2, which is weighing the contents of the container, including cargo and any packing materials, and then adding that to the tare weight of the container printed on its outside. The OCEMA guidelines affirm the basic requirement on shippers.

Jeff Lawrence, the Washington-based executive director of OCEMA, said the best practices represented the most direct statement carriers have made to date regarding the tare weight “not being an issue” for shippers since carriers won’t hold them legally responsible for the weight of the container. He said the best practice guidelines are meant to make the process of complying easy for exporters and to ensure cargo movements aren’t disrupted. “A key objective of the best practice is to develop processes that will have as small an impact as possible on all participants,” the guidelines state.

The Agriculture Transportation Coalition, which has been leading an effort to limit what exporters need to provide to carriers to the weights they provide currently, cited private conversations with carrier executives who it said endorse its approach to continue current practice under which shippers provide the weight of their cargo as part of standard documentation submitted with each shipment. “We are puzzled by the inflexibility of carrier/OCEMA/WSC (World Shipping Council) as it adds complexity and cost not only for shippers, but for carriers at a time that carriers can ill-afford additional costs of operations,” the AgTC said in a statement issued on Monday. It proposed that carrier operations executives sit down directly with exporters “to figure this out.” It added: “Hey carriers! — leave the lawyers at home — who knows, you might find a way to reduce costs, improve relations with your customers and start making money again.”

The key point of disagreement has been the tare weight, which U.S. exporters have taken vocal exception to having to provide. In a March 14 letter to Coast Guard Commandant Paul F. Zukunft signed by 49 trade associations, the exporters said: “some ocean carriers, citing this SOLAS amendment, are demanding that the shipper certify both the cargo and the carrier’s container. This is contrary to the practical realities of our U.S. export maritime commerce and fundamentally flawed conceptually.”

The required signature on the VGM, which must be from an individual representing the company, is legally problematic, the 49 associations said in their letter. “Many U.S. corporations will not allow their employee to certify the weight of and assume liability for equipment that the corporation does not own, manage, control, and in fact may not even see.”

The exporters in their March 14 letter cite recent statements from Coast Guard Rear Adm. Paul Thomas, which suggested that since the provision of the VGM from the shipper to the carrier is a “business practice” for which there are many possible solutions, there should be no reason why shippers should not continue to provide just the cargo weight as they do currently. According to the letter, if “the shipper provides the cargo mass weight, to which the carrier adds the weight of the container, then the intent of SOLAS is achieved. In fact, several ocean carrier executives have advised that such a process would be practical.”

But that is not what the OCEMA best practices state. “The shipper is uniquely situated to know and report the weight of the container,” OCEMA said in the best practices document. Lawrence said that given the large number of U.S. exporters, marine terminals and carriers, the process for submitting the VGMs must be orderly or else disruption would be a likely result.

According to OCEMA, emphasizing the procedural as opposed to legal requirement for the tare weight to be provided: “To facilitate shipper operations, some ocean carriers have indicated that they may provide a database of tare weights on their websites. However the tare weight is provided, it is acceptable for shippers to rely upon the tare weight being made available by the ocean carrier. The shipper would not be certifying the accuracy of the container tare weight printed on the container.”