Freight forwarders have renewed calls for shipping lines to axe their surcharges
“Forwarders do not like shipping line surcharges, and we have been challenging their legitimacy on behalf of our members – and their customers – for many years,” said Robert Keen, BIFA Director General.
Earlier this year, the Global Shippers’ Forum launched a campaign promising to end the surcharge system by 2020, threatening to “name and shame” carriers and forwarders that use surcharges to “exhort” extra payments from customers.
“Our members have become used to shipping lines adding peak season, fuel and currency surcharges, but the number of surcharges and fees continues to grow – often with no real explanation or justification,” said Mr Keen this week.
“For instance, what does an extra ‘administration fee’ or ‘container sealing fee’ cover that is not in the standard service offered?
“Last week, one line said it was moving to address the container imbalance problem in North Europe, brought on by increasing demand for containers, by introducing ‘equipment imbalance surcharges’ on the eastbound Europe-Asia trade,” he added.
Shippers have also been asked to pay surcharges when there is port congestion caused by labour unrest or bad weather, or haulage surcharges when there is a shortage of HGV drivers.
Part of the impetus for the GSF’s campaign was carriers introducing surcharges when the new SOLAS regulations on the verified gross mass of container weights came into effect in July.
This week, CMA CGM published its 2017 ancillary charges for UK exporters – some 61 separate items the carrier can levy on shippers, including a £20 VGM “UK administrative fee”.
Earlier this year, GSF secretary general Chris Welsh said: “The shipping industry campaigned vigorously for the introduction of this new requirement on safety grounds. it is therefore regrettable that many in the maritime supply chain, including some carriers, are using the opportunity of the new rules to levy unjustified and arbitrary surcharges on shippers. As part of GSF’s campaign to rid world trade of surcharges by 2020 this practice has got to stop now!”
However, BIFA’s Mr Keen stressed that forwarders did all they could “to minimise the effects of the surcharges, but in the end at least some of the costs need to be passed on to the customers”, and added: “There is sometimes an unfair perception that our members are to blame.”
He is also chairman of the Multimodal Transport Institute within FIATA, the international trade association that represents the world’s freight forwarders and logistics service providers, which has focused on surcharges for several years.
“If a shipper enters a contract to buy goods, they should know exactly what they are paying and that price should not change. If they use Incoterms, they can buy ex-works or FOB and control the supply chain. If they let their supplier arrange shipping, they have no control over the charges applied.
“But in either case, additional surcharges imposed by shipping lines should not be allowed,” he said.
Along with naming and shaming “the worst examples of opaque and unjustified surcharges”, the GSF said it would also make the World Trade Organisation and UN “aware of the scale and impact” of the system and seek an amendment to the INCOTERMS compiled by the International Chamber of Commerce “to make clear who is responsible for the settlement of certain costs currently recovered through surcharges”.