FMC Launches Expedited Review of Shipping Carriers’ Congestion Surcharges & Other Fees

Toy Association Exec. Committee Met FMC to Advocate for Solutions to Shipping Crisis

August 5, 2021 | The Federal Maritime Commission (FMC) announced Wednesday that it is launching an expedited review of eight shipping carriers and whether their surcharges and other fees tied to the current supply chain disruption meet legal and regulatory requirements. Container lines will be fined if the FMC finds carriers did not correctly establish tariffs. The Toy Association, whose executive committee met with the FMC and its chairperson July 14 and has been aggressively advocating on this issue at all levels of government, is encouraged to see the agency take action.

“In speaking with the FMC, we shared our members’ stories and urged action to help the hundreds of toy companies that are struggling to get their products onto ships and, if they do find containers and space, are being met with insurmountable surcharges and fees,” said Ed Desmond, executive vice president of external affairs at The Toy Association. “We are glad the FMC is acting on this issue of paramount importance to many small and medium toy companies that are still recovering from the pandemic and are counting on a successful Q4 – as well as to the millions of American families who are looking forward to a fun holiday season.”

The FMC is investigating CMA CGM, Hapag-Lloyd, HMM, Matson, Mediterranean Shipping Co., OOCL, SM Line, and Zim Integrated Shipping Services; the carriers have until August 13 to provide details showing that they gave shippers at least 30 days of notice about surcharges and published clear, definite tariffs.

The FMC’s aim is to determine whether carriers gave proper notice of surcharges, whether the reason for the extra fees was clearly explained, and which conditions prompted the carriers to issue surcharges, as well as how they defined when the surcharges would end. Currently, container lines are levying charges ranging from $350 to $5,000 on Asia imports.

This order follows a July 20 announcement from the FMC to the top nine container lines operating on U.S. trades that the agency would immediately begin auditing how they bill customers’ detention and demurrage charges.

The Toy Association continues to advocate on this issue, urging government officials to implement solutions and encouraging consumers to #shopearly4toys to avoid disappointment this holiday season. Questions on this topic may be directed to Ed Desmond, executive vice president of external affairs.

Be on the lookout next week for a Toy Association President’s Letter from Steve Pasierb that dives deeper into the issue and what The Toy Association is doing to help.