Archive for May, 2016
A big thanks to the exhibitors, attendees and organisers of 2016 workspace at INDEX for a fabulous show in Dubai 23-26 May 2016. Some images below !
What is the SOLAS Container Weight Rule?
The International Maritime Organization (IMO) has amended the Safety of Life at Sea (SOLAS) convention in the wake of several maritime safety incidents between 2007 and 2015 believed to be linked to inaccurately-reported container weights.
Under the new rule, effective July 1, 2016, ocean freight carriers worldwide will be prohibited from loading a container aboard vessels in 162 countries worldwide unless the Shipper (as identified by the Shipping Line B/L) has provided the carrier with the verified gross mass (VGM) of the container. The VGM must be provided to the carrier either digitally or signed and noted on the bill of lading prior to vessel loading.
How is the New SOLAS Rule Being Implemented?
Two methods have been outlined for determining the VGM of a container:
Method 1: Weighing the loaded container
Method 2: Adding the verified weight of the contents of each container to the container tare weight.
Though enforcement of the new rule will go into effect on July 1, questions that stakeholders around the world are struggling to address include how container weights should be determined, be reported to carriers, how will the rule be enforced, and what is the implication of non-compliance.
At present no single global standard exists for the above, and it appears unlikely that such a standard will be adopted prior to July 1. Even within the United States, there is no uniform standard for how to obtain container weights and communicate them to carriers.
There is also uncertainty over how far in advance VGMs will need to be submitted to carriers. It appears that carrier cutoff times for VGMs will vary from vessel cutoff times – with VGM deadline dates occurring earlier than general cutoffs, depending on the carrier.
As a general rule, carriers are requiring VGM receipt prior to containers being received at port for export. Carriers are further advising that if the VGM is not received by their deadline, costs will be incurred for the account of cargo which may include port weighing charges, additional terminal handling, container roll charges and demurrage.
To further complicate implementation, the IMO did not specify a uniform margin of error for declared container weight vs. actual weight. As a result, each of the 162 effected countries will be able to define their own margin of error and terms for enforcement. Below is a snapshot of how different countries are approaching enforcement:
- Argentina – Weight must be accurate within 5%.
- Brazil – The countries container terminals have an existing policy in place of weighing containers upon receipt at port. The terminals plan on charging the carriers 40-60 reais/container for VGM input
- Canada – Spot checks will be performed on container weight. Violators will be fined ranging from C$600-C$1,200.
- China – Weight should be within 5% or 1 Ton.
- India – Weight must be exact within 200 kg.
- Japan – Fine of up to USD 2,600 per violation if there is a discrepancy of more than 5% in container weight.
- Russia – Terminals such as Container Terminal Saint Petersburg and NUTEP Novorossiysk will allow container weighing at the port, though it is unclear whether the necessary infrastructure will be in place by July 1.
- South Africa – Auditing, inspections to ensure compliance. Violators can be imprisoned for up to one year or fined.
- United Kingdom – Shippers planning to weigh the contents and packaging of a container as per Method 2 will have to become certified by the U.K. Maritime and Coast Guard Agency, and pay a fee for their application. Shippers will need to fill out a checklist and provide documented evidence in order to receive MCGA approval, and once certified, will be added to a publicly available database tracking exporters. Shippers must have documented evidence of a process control system such as an ISO 9000 certification, the weighing method used, detailed information of weighing equipment that will be used, equipment maintenance and calibration processes, record retention, training in equipment use and procedures for dealing with faulty equipment. Failure to adhere to the new law (weight must be accurate within 5%) will constitute a criminal offense punishable by imprisonment or significant fine.
- UAE – DP World has advised they will weigh each container at the terminal and provide the VGM for a fee per container.
- United States – Coast Guard is leaving enforcement of the rule up to interpretation of, and enforcement by, the shipping industry. Congress refuses to clarify official U.S. Government stance. Speculation of possible involvement by Federal Maritime Commission (FMC) to set clearer guidelines.
Summary – US exports
As far as shipments from the US are concerned, the practical application of the new regulations, whilst still in the process of being formalised, can currently be summarised as follows :
- The shipper (as identified by the Shipping Line’s B/L) is responsible to declare the VGM to the Carrier.
- The VGM is currently expected to be an electronic declaration to the carrier.
- The VGM should be transmitted by the shipper’s authorised forwarder or the NVOCC (if not a direct shipment), based on the verified container contents information confirmed by the shipper, including shipment weight (product and packaging), loading/dunnage materials, added to the tare weight of the container.
- The shipper should have a method in place to determine the actual weight of the contents of the container. Methods could include :
- weighing the contents prior to loading,or
- using published manufacturer’s weights if product is shipped in manufacturer packaging and the weight is printed on that packaging, or
- for manufacturers, using standardised shipment weights where weights of samples have been separately verified, or
- any combination of the above.
- The shipping lines will generally require receipt of the VGM information prior to the container arriving in to port for onward shipment, otherwise cost will be incurred for delay / port handling – which cost will not be inconsequential.
- In the case of a less than container load shipment, the responsibility for verifying the detail of, and transmission of, the VGM remains with the NVOCC/consolidator/master loader.
We will continue to keep you updated on developments, and please be assured that we will work with each of our customers on a case by case basis to ensure that shipments are in compliance with the new rulings, and do not incur unnecessary cost or delay on export.
Courtesy : JOC, American Shipper, CargoSmart, Cargo Business, IMO, World Shipping Council