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Policy & Compliance


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Containers abandoned overseas


If you buy space from a shipping line or airline at one price and sell from your own tariff, you are a principal and may be responsible for abandoned cargo


One of the most frequent questions regarding problems on maritime shipments that BIFA receives is about containers sitting at overseas ports unclaimed or abandoned. Often the BIFA Member has closed the file with


the goods shipped and carriage paid, and is surprised and concerned to receive a demand for storage and quay charges from the shipping line. Often Members say “but I’m only an agent”, or “but my name is not on the bill of lading”. We also see a variety of phrases such as “acting as an agent only” on pre-printed forwarder bills of lading, or similar wording as footers on correspondence issued by BIFA Members. Whilst in general terms anyone who undertakes a task for another could be called an agent, in law it is not what you say you are but what you do that defines the role you perform. Although some BIFA Members act as an agent


from time to time, the majority of transactions that occur are where a freight forwarder buys space from a shipping line or airline at one price and sells from its own tariff. In this scenario, the


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freight forwarder is a principal. If there is a later problem, for example if the goods are not collected at the destination, then the shipping line will look to the freight forwarder for quay rent, etc, as the party it contracted with.


Responsibilities


Another issue is that if you have goods sitting overseas and neither the shipper nor the consignee can be contacted, you cannot simply abandon the cargo. The shipping line will sometimes take lien if the commodity is something that can be easily sold on, but many commodities need specialist handling and the shipping line will look to the contracting party, the forwarder, for payment of such charges. It is impossible to safeguard against getting into this sort of situation if your file has been closed and the consignee does not take delivery at destination. Of course, your shipper has indemnified you against such outgoings under the BIFA Standard Trading Conditions and is liable for such costs, but if it has ceased trading


or simply gone away without trace, the forwarder may find itself liable for the unpaid charges. It is less likely that consignments from a


regular shipper to a regular consignee will cause a problem. However, if you have concerns regarding the standing of your customer, it is suggested that Members have office procedures to close files or keep a log of when goods have been discharged overseas, which we understand may be difficult.


Main commodities


Having looked at the enquiries that we have received on this matter, the main commodities involved include scrap materials, personal effects and charity goods, all of which tend to be low value. On the first mentioned, Members should be aware that countries such as China are tightening up regulations, which may lead to an increased amount of such goods being abandoned. When confronted by such a demand, our guidance would be to minimise any exposure by asking what the line will accept as a commercial settlement and look at the impact of the recent MSC v Cottonex case, which in certain instances limits the period that quay rent and demurrage can be charged for. In the final analysis, Members will be forced to seek legal advice to establish their legal position.


December 2017


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