Container Lines Agree $2.6 Million Payment With FMC Ship’s crew

Two container shipping companies, Ocean Network Express (ONE) and Wan Hai Lines, have agreed to pay a total of $2.65 million in civil penalties to resolve individual misconduct allegations made by the Bureau of Enforcement, Investigations and Compliance ( BIC) of the Federal Maritime Commission).

The BEIC was formed last July as part of a reorganization that unified the investigative and prosecuting functions of the FMC following the passage of the Ocean Shipping Reform Act of 2022 (OSRA).

In April, ONE reached a compromise with the FMC to address allegations that the company violated US law by charging detention fees if appointments were not available during the allotted free time for device return. As part of the agreement, ONE agreed to pay a $1.7 million civil penalty.

In particular, the agreement introduced a new provision that obliges ONE to pay compensation to the affected shippers in the form of refunds and waivers. ONE also reaffirmed its commitment to comply with OSRA and the Interpretation Rule on Detention and Demurrage.

In another case, Wan Hai entered into a settlement agreement with the Commission to address allegations that the company violated US law by failing to follow fair and reasonable practices regarding empty container return fees.

Wan Hai agreed to pay US$950,000 in civil penalties and reimbursed all affected shippers for detention fees. The company has also implemented corrective actions to prevent future violations and ensure compliance with the FMC Interpretation Rule on Detention and Demurrage.

FMC Chairman Daniel B. Maffei commended the Bureau of Enforcement, Investigations and Compliance for its efforts to enforce effective civil penalties and provide relief to affected shippers.

“The agreements announced today send a clear signal to the international shipping community that ocean carriers must fully comply with US legal obligations,” said Chairman Maffei.

The payment of civil penalties by ONE and Wan Hai follows a similar case in June 2022 in which Hapag Lloyd AG paid $2 million to resolve allegations of violations of US law related to sentencing.

The FMC stressed that it is important to distinguish that a compromise agreement, such as that with ONE, is reached prior to formal enforcement action by the FMC, while a settlement agreement, such as that with Wan Hai, completes an ongoing enforcement process. In both cases, neither ONE nor Wan Hai admitted breaking the law.

The final settlement comes as FMC separately flags $1 million in disputed fees that have been waived or refunded under OSRA’s fee grievance process. The milestone was reached on May 1, just over ten months after OSRA came into force. OSRA authorized the FMC to promptly investigate “information regarding complaints about charges made by a carrier” and order refunds and/or penalties for charges that do not comply with relevant regulations.

Civil penalties paid by shipping companies go to the general fund of the US Treasury Department, the Federal Maritime Commission itself receives no revenue.

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