MSC Faces $63M Fine for Alleged Shipping Act Violations

Global shipping giant Mediterranean Shipping Company (MSC) is facing a hefty fine of at least $63 million after the US Federal Maritime Commission (FMC) accused them of violating the Shipping Act. The FMC launched its investigation in August 2023 following complaints from several MSC customers who disputed substantial charges, including detention and demurrage fees, dating back to 2017.

Unfair Practices Targeting US Businesses:

The FMC’s Office of Enforcement alleges that MSC engaged in unreasonable and unfair business practices impacting Non-Vessel Operating Common Carriers (NVOCCs), freight forwarders, customs brokers, and truckers in the United States. These practices, according to the FMC, hindered the efficiency and competitiveness of US ocean commerce.

Key Allegations:

  • Misuse of “Merchant Clause”: The FMC alleges that MSC misused its “merchant clause” in standard bills of lading to bill non-contracting third parties for detention and demurrage fees, exceeding 18 violations.
  • Overcharges on Non-Operating Reefers: The investigation uncovered over 3,000 instances of alleged overcharges related to non-operating refrigerated containers (reefers). The FMC claims these overcharges were due to a lack of proper auditing and reconciliation by MSC, potentially constituting a deliberate violation or negligent accounting practices.

MSC Accused of Exploiting Market Power:

The FMC’s Office of Enforcement further accuses MSC of exploiting its market dominance to manipulate standard bill of lading terms like “merchant” to justify billing non-consenting third parties listed as “notify parties.” This practice essentially turned these third parties into involuntary billing departments for MSC.


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