Category: Sea Freight Export Import


US – Sadly some of our best read stories concern the criminal activities of the few freight forwarding executives who are prepared to break the law in order to turn a profit. As times get harder financially the line between fair competition and conspiracy blurs for some as evidenced by the surge in anti trust cases prosecuted globally which we have witnessed in the past two years. Some acts however are blatantly criminal and this week two cases concerning the cargo screening and shipping of air freight have resulted in the prosecution and punishment of several individuals and companies involved in nefarious activities.

The first case concerns the arrest and detention of Ulrich Davis aged 50 who was caught as he tried to board a flight to the Netherlands at Newark Liberty International Airport last August. Davis, a Dutch national, pleaded guilty this week to charges of conspiring to violate the International Emergency Economic Powers Act and the Iranian Transactions Regulations by misdeclaring chemicals and aircraft parts destined for Iran.

Evidence against Davis was overwhelming in that e mails he had sent to another company made it plain he knew what he was doing was illegal. The items concerned were suspected to be for military use and one of the consignees were allegedly described as ‘C-130 Red Crescent’ seemingly implying the supplies were for a section of the International Red Cross. Observers have speculated that these were parts for C-130 Hercules military transport aircraft at least twelve of which are still in service with the Iranian air force.

Davis used his position as manager of a Netherlands based freight forwarder with a New Jersey office (we are not allowed to name the company) to issue and conspire with others to issue airwaybills showing false details, the nature of the goods being such that they constituted a threat to national security. Because of his guilty plea Davis will avoid the maximum term of twenty years imprisonment but is likely to receive a five year term plus a fine up to a quarter of a million dollars when sentenced.

In the second case three employees of OHL (part of Ozburn-Hessey Logistics, LLC), a subsidiary previously being known as ActivAir and one of the world’s largest third party logistics providers, have each pleaded guilty following a federal investigation. The three confessed to failing to screen cargo due to load on passenger flights despite strict regulations as to how the procedure should be undertaken.

The offences occurred at the company’s Fortune Circle premises at Indianapolis Airport and once again penalties could be up to five years in prison with quarter of a million dollar fines for each defendant. Mitchell Totty, Brian Vanhandel and Andrew Barnes are each accused of conspiring together to violate the law instituted in 2010 which insists on accurate records regarding screened cargo following incidents when bombs were discovered whilst being carried as freight aboard passenger aircraft in Dubai and the UK.

OHL has fully cooperated with the authorities and accepted responsibility for its employees behaviour but the admission led to the company receiving a record fine of $1 million for the offences and U.S. Attorney Joe Hogsett commented the safety of the travelling public was paramount and that there could be no tolerance for shortcuts when matters of national security were involved.

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Bali shipping line news After the recent news that CMA CGM and MSC will be working more closely together to maximise efficiency of freight services the two giant container shipping lines have confirmed adjustments to their schedules whilst MaerskHamburg SüdCSAV and CSCL have also seen Winter season restructuring.

In an effort to balance supply and demand during the forthcoming traditional period of weaker demand, Hamburg Süd and Maersk Line on the one hand and CMA-CGM, CSAV and CSCL on the other, have reached an agreement to adjust their services between Asia, South Africa and the East Coast of South America as from this month until next May.

Each Group is currently operating two weekly services in the trade. For the period from December 2011 through May 2012, the existing ASAS/NGX Sling 2 service will be merged with the existing ASAX/SEAS Sling 2 service. The current capacity deployed by the carriers in the ASAS/NGX Sling 1 service (Maersk and Hamburg Süd ) and ASAX/SEAS Sling 1 service (CMA CGM, CSAV, CSCL) will remain unchanged and independent. This means the ASAX/SEAS 1 which currently utilises eleven 6,500 TEU vessels will now have the same number of smaller ships each between 4,200 and 4,600 capacity. Starting vessel for this New Joint Service will be MV Cap Jackson – Shanghai – December 16th and the rotation is :

Shanghai – Ningbo – Nansha – Hong Kong – Chiwan – Tanjung Pelepas – Singapore – Durban – Rio de Janeiro – Santos – Paranagua – Itajai – Santos – Port Elizabeth – Durban – Singapore – Hong Kong – Shanghai

Meanwhile the CMA CGM and MSC agreement means that from April 2012 the Asia-North Europe services (French Asia Line or FAL routes) will vary as follows.

FAL 1: operated by CMA CGM with 11 vessels of 13,800 – 14,000 TEU. Port rotation: Ningbo, Shanghai, Nansha, Hong Kong, Chiwan, Yantian, Vung Tau, Southampton, Hamburg, Bremerhaven, Rotterdam, Zeebrugge, Le Havre, Malta, Korfakkan, Port Kelang, Singapore, Yantian, Ningbo.

FAL 2: this service remains unchanged.

FAL 3: operated by CMA CGM with 11 vessels of 11,400 TEU. Port Rotation: Xingang, Pusan, Qingdao, Shanghai, Xiamen, Singapore, Port Kelang, Tangiers, Le Havre, Hamburg, Bremerhaven, Antwerp, Zeebrugge, Beirut, Jeddah, Port Kelang, Singapore, Xingang.

FAL 6: operated by MSC with 11 vessels of 14,000 TEU. Port Rotation: Dalian, Xingang, Kwang Yang, Pusan, Qingdao, Ningbo, Shanghai, Singapore, Port Kelang, Felixstowe, Zeebrugge, Antwerp, Rotterdam, Southampton, Valencia, Jebel Ali, Singapore, Hong Kong, Dalian.

FAL 7: operated by MSC with 11 vessels of 14,000 TEU. Port rotation: Ningbo, Shanghai, Xiamen, Chiwan, Yantian, Sines, Le Havre, Rotterdam, Antwerp, Felixstowe, Gioia Tauro, Singapore, Chiwan, Xiamen, Ningbo.

The existing agreement with Maersk Line on the Asia-Med trade will remain unchanged and final port coverage and transit times will be confirmed at a later stage as will any news regarding further rationalisation to the other FAL services.

Both MSC and CMA CGM have been at pains to stress that there new cooperation should not be viewed as any form of amalgamation with no staff being affected and no sharing of facilities. Such a move would undoubtedly set alarm bells ringing in the offices of anti trust authorities particularly those of the EU’s Competition Commissioner

This week saw two of the most substantial players in their own fields underline similar tactics for dealing with a turbulent freight market. Clarksons the London based shipping services group announced it had acquired EnShip Ltd the Aberdeen based shipping agency and marine industry logistics specialist via its Clarksons Port Services Group. Meanwhile French giant Norbert Dentressangle completed its acquisition of APC Beijing International, a China-based freight forwarding company.

Enship, formed in 2004, has built a reputation as a vessel agency within the UK, as well as being a provider of related support services to both its UK customers and worldwide client base. EnShip also encompasses Opex Industrial Supplies, a procurement house supplying the marine, oil and gas industries. It will retain brand identity and Clarksons says it complements its port sector strategy to expand its geographical reach and broaden its services to existing and new customers in bulk shipping and the offshore and renewable industries. Gross assets acquired amounted to £3 million.

Dentressangle has followed up the Memorandum of Understanding signed in July to take over, APC Beijing International which last year generated revenue of €50 million. APC employs a staff of 270 spread throughout 16 offices strategically located in China’s key costal and inland regions. Known best for its European road haulage operations the acquisition strengthens Dentressangle’s foothold in Asia and says it will enhance the company’s service offering in airfreight forwarding

The International Transport Workers Federation (ITF) which represents over 4 million union members associated with the transport industry has expressed fears over the safety of some reefer shipping containers following fatal accidents. In April of this year there were two incidents at a Cat Lai repair yard in the Port of Ho Chi Minh City whilst repairs were under way on Maersk Linereefer boxes followed by another death in Itajai ,Brazil last month.

Maersk tell us that investigations so far lead them to conclude that the three explosions have been caused by a contaminated refrigerant being injected into the cooling system. Incorrect repair processes and procedures would not be able to cause these explosions. Until the exact reason for the incidents is known and a safe repair method has been developed, Maersk Line will continue to ground all reefers that have had a gas repair in Vietnam since the 1st February. This is being done as a precautionary measure the total number of units being involved is 844 whilst the Danish group operate 230,000 reefers in total. Hutchison Ports has also advised its customers to check any containers serviced or repaired in Vietnam recently and there are reports of another similar accident in China earlier this year.

Maersk are in possession of samples from the unit that exploded in Itajai as well as gas samples from containers they have grounded and that have had gas repairs done in Vietnam. Unions are calling for full investigation into the causes and scope of the problem and ITF representative Frank Leys said the unions were pleased to see that big shipping lines like Maersk had reacted so quickly to deal with the situation and urged the US union organisations to ensure companies operating from there acted equally promptly to alleviate any risk. Mr Leys, the ITF dockers’ section secretary continued:

“Where there are possibly contaminated containers still at large, we are calling on port authorities and shipping companies to issue clear guidance on how they should be handled. The health and safety of workers is paramount and in no instance should commercial or productivity issues be allowed to supersede the welfare of workers.”

Seafarers’ section secretary Jon Whitlow added:

“We are extremely concerned for the welfare of those workers on ships who may be unaware that a defective container is being carried on board. Although we acknowledge that the maritime community is moving fast to provide the necessary information and advice on how to handle the contaminated containers in ports, we hope the same approach and priority is given to adequately inform the on board safety officers in order to protect the integrity of seafarers and ships.

“Whilst of course the explosion of a container ashore is a tragic event, we think that a similar explosion on board a vessel could have potentially catastrophic effects on workers, ships and the environment.”

Authorities in Vietnam tell us within weeks Tan Cang will begin verifying the gas quality with a specialist machine before recharging reefer containers. Last week neighbouring Cat Lai port held a meeting to review the situation and the implications for the trade in container repairs and inspections which local sources estimate will cost them up to $20 per box if standard checks are farmed out to other ports en route. A statement said that port bosses agreed to allow the shipping lines to appoint a suitable foreign inspector to oversee repair and inspection procedures.

Vietnam has long provided the essential pre trip inspections (PTI’s) required by refrigerated units. Each reefer is subject to either a 20 minute check which is suitable for empty or loaded containers or an extended test which normally takes around 3 hours and is only suitable for empty boxes. In each case the control system for the fridge unit is checked and that there are no odours, gas leaks etc plus the box is clean and trip worthy

GREECE – The Panhellenic Seamen’s Federation (PNO) has announced that its members are on strike until 0600 local time Wednesday the 19th of October. During this period no ships will be allowed to set sail from any Greek port or harbour.

The Federation is demanding that seamen’s pensions and social insurance fund continue to receive state funding and that current benefits be maintained, as well as security for Greek seamen’s jobs, improvements in training and action against unemployment. It also wants the ship owners to re-enter national collective bargaining negotiations so that wages can be upgraded.

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