News / Voltage Creative

The Ocean Carrier Equipment Management Association (“OCEMA”) amended its Recommended Best Practice for the Acceptance and Transmission of Verified Gross Mass (VGM) to include a Terminal Weighing Approach (TWA). The TWA contemplates that marine terminals will provide gross container weights directly to ocean carrier stowage planners as VGM on behalf of shippers.

What this Means: Vessel Operators have finally agreed that the existing practice, whereby the marine terminals weigh containers prior to loading, is sufficient compliance for purposes of the VGM rule. Many Carriers have indicated they will now accept the weight provided by the terminals in lieu of receiving anything from shippers or NVOCCs with respect to traffic moving to the terminals by truck. With respect to containers moving by rail to the port of lading, most carriers have agreed to provide tare weights of the containers to be added to the weights reported by the shippers and NVOCC’s, and that would again constitute sufficient compliance with the VGM amendment.

MIQ Amended Procedures: MIQ will no longer require the Verified Gross Mass (VGM) Certification distributed in June. Instead, MIQ requests that our client shippers either (a) use the revised MIQ Shipper’s Letter of Instruction (SLI) or, should the client shipper prefer to use its own form(s), (b) sign and return the MIQ Amended Terms and Conditions acknowledging that (i) MIQ is entitled to rely on the accuracy of weights provided by the shipper and (ii) agreeing to indemnify and hold MIQ harmless from any and all claims, all claims, losses, penalties or other costs resulting from any incorrect or questionable statements of the weight provided on which MIQ or its agent relies.

MIQ will continue to monitor the situation very carefully on a carrier by carrier basis. Please contact your MIQ Account Representative with your questions and concerns.

CBP issued CSMS #16-000499 on June 17, 2016 announcing that (a) Local Customs Ports will now issue Liquidated Damage claims without Headquarters’ review; (b) no longer will Ports issue three warnings before initiating Liquidated Damage claims (i.e. the “three strikes” policy); and, (c) Ports may hold cargo instead of (or in addition to) initiating Liquidated Damage claims.

The maximum liability for ISF filings is $10,000 in liquidated damages. However, CBP will normally assess a liquidated damages penalty of $5,000 per violation for most ISF violations (except for missing ISF’s). The guidelines also state that CBP will consider the presence of mitigating and aggravating factors when determining the final liquidated damages or penalties. Mitigating factors include: evidence of progress in implementing ISF requirements, a small number of violations compared to the number of shipments, Tier 2 or Tier 3 C-TPAT status, and demonstrated remedial action to prevent future violations. Aggravating factors include: lack of cooperation with CBP, evidence of smuggling, multiple errors on the ISF, and a rising error rate. Source: THE INTERNATIONAL LAWYER, Vol 44, No 1 (Spring 2010)