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China is stepping up its crackdown on container transport service providers for regulatory breaches, as the industry navigates an increasingly volatile trade environment.
China’s Ministry of Transport (MoT) has issued notices imposing fines on several major container lines and domestic NVOs that have allegedly engaged in freight rate filing violations.
Liners facing the heat include CMA CGM, MSC, Hapag-Lloyd, ONE, Evergreen, Wan Hai and Emirates Shipping.
The MoT is said to have found discrepancies between actual freight rates and filed rates, adding that it had held talks with companies before coming down hard on them “to strengthen the regulation of international container liner shipping and non-vessel operating common carrier markets, and enhance public oversight, in accordance with the administrative penalty law”.
It added: “…shipping companies and NVOCC operators are requested to take this as a warning, improve their freight rate filing systems, ensure accountability, and earnestly fulfil their freight rate filing obligations.”
The authority also warned that regulatory scrutiny would be further intensified.
The ministry said it had carried out inspections at the ports of Guangzhou, Qingdao, and Ningbo between August and November last year before moving ahead with the punitive action.
Chinese regulatory crackdowns on carriers are nothing new. In 2017, more than a dozen container lines faced the crack of the MoT whip for failing to be transparent on freight rate quotes. And in the aftermath of the Middle East war this year, the ministry warned ocean carriers against “opportunistic pricing”, as capacity and port connectivity became a challenge for shippers.
Despite the regulatory whip, the Middle East supply chain crisis has seen carriers roll out a wave of surcharges on freight to the Persian Gulf.
India, through its national maritime administrator the Directorate General of Shipping (DGS), has also come down on carriers, seeking transparency in logistics costs and warning against predatory pricing practices.
“The DGS has received representations from various stakeholders in the export/import trade regarding the levy of multiple ancillary charges by shipping lines/carriers and their agents,” it said.
“These charges are perceived to be non-transparent and opportunistic in nature, resulting in an escalation of transaction costs in the logistics chain and appearing to take undue advantage of the prevailing geopolitical tensions and war-like situation.”
But questions remain on the effectiveness of that intervention, as hefty war-risk surcharges and other extra costs have found their way into shippers’ freight bills.
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