Federal Maritime Commission fines MOL US$1.2 million for Shipping Act breach

JAPANESE shipping giant MOL has paid a US$1.2 million fine after a plea bargain with the prosecuting US Federal Maritime Commission (FMC) on charges of misdescription of cargo, unlawful equipment substitution, providing transport with unlicensed parties, using contracts with those not party to those contracts and providing transport at rates not in MOL`s published tariffs - all violations of the US Shipping Act.

MOL agreed to pay penalties, but made no admission of guilt or admitted to violations of the Shipping Act or FMC regulations. The company MOL provided information and documentation on service contracts and also agreed to cooperate with any further FMC investigation.


FMC enforcement chief Peter King said his office became convinced MOL knew about some of the abuses it uncovered by non-vessel-operating common carriers or shippers, reported American Shipper.


Mr King said his office had concentrated on possible violations by NVOs and on shipments to the United States from China, particularly the Shanghai area, as well as Hong Kong.


Mr King then described practices his investigation uncovered. A shipper may, he said, would assert his container was loaded with a commodity for which the rate was low, but then put in expensive goods that would have commanded a higher rate. In another case, a carrier may provide larger a larger container than ordered - say a 40-foot high-cube rather than a standard FEU, typically during an FEU shortage.


Carriers would provide the bigger box on condition that the shipper not use the extra space available, but some would fill it to the brim regardless of any previous undertaking.


In other cases, companies not registered or licensed as NVO [non-vessel operators] will consolidate cargo from others and pretend they are the shipper.


Said FMC chairman Richard Lidinsky: "If you`re violating the law, sooner or later, we will find you, and the consequences can be serious."