Under new rules scheduled to take effect on July 01, 2016, shippers will have to provide a signed, certified weight declaration for each container, to the ocean carrier and terminal.( A new SOLAS (Safety of Life at Sea convention of the International Maritime Organization or IMO) takes effect requiring shippers whose name appears on the bill of lading to verify the gross mass of a container carrying cargo when tendering the container to the ocean carriers and terminals. Is this workable? Will containers without proper certification be allowed into terminals? The Journal of Commerce developed a “Shippers guide to the container weight mandate” JOC Staff, December 14, 2015. Every international shipper should familiarize themselves with this rule and stay up to date on any new developments. The Journal of Commerce and JOC.com are excellent sources of information on this topic. Their Dec 14th guide is below.
On July 1, 2016, a new SOLAS (Safety of Life at Sea convention of the International Maritime Organization or IMO) takes effect requiring shippers whose name appears on the bill of lading to verify the gross mass of a container carrying cargo when tendering the container to the ocean carriers and terminals. Many questions still remain unanswered, and there is widespread frustration about lack of information including from key service provides including container lines and marine terminals. Rules and legal enforcement are likely to vary potentially widely among countries, ocean carriers and marine terminals, making this rule potentially a big headache for shippers to comply with. But a few things are already clear: On July 1 the rule becomes not just international law under the IMO but national law within the 170 countries and three associate members that are signatories to the IMO. The legally responsible party for providing a verified gross mass (VGM) signed either electronically or on paper is the shipper. Approximately 300,000 container weights will need to be certified each day globally, and roughly half of all booking requests and shipping instruction submissions each day are non-digital, in other words, in paper form, according to Inttra. Early analysis suggests the ocean carrier and the marine terminal will be strict in not accepting containers lacking an accompanying VGM since under the SOLAS rule they can be held responsible, and thus incur unacceptably high legal liability, for loading a container for which a VGM hasn’t been provided. For example, Hapag-Lloyd said, “A packed container, for which a verified gross mass has not been obtained, will not be loaded on the vessel.” Crowley said it “stands firmly behind the rationale for this regulation.” Marine terminals may in some cases offer weighing services if it can be done without disrupting regular terminal operations, but this will not be in all cases, as some terminals, such as Maher Terminals at New York-New Jersey, in December said it does not have the capacity to offer weighing services for non-compliant containers and won’t in-gate any container without the VGM already received via EDI. Overall, frustration levels across the industry were rising as of January, 2016 based on lack of specific plans by key parties and concerns that individual countries will issue differing regulations, creating a compliance nightmare. Bjorn Jensen, vice president for global logistics at the consumer goods manufacturer Electrolux, reflected these sentiments on Jan. 7, saying “I am immensely frustrated, as is every other shipper I have talked to, by the near total lack of industry co-ordination, and indeed by the feeling I’m getting that even carriers have no idea how this is going to play out.”
The following questions and answers are drawn from a variety of sources, including JOC.com reporting, published commentaries, press releases, statements by speakers at JOC events, and an official Q&A published jointly in December, 2015 by the World Shipping Council, TT Club, Global Shippers Forum and International Cargo Handling Coordination Association (ICHCA). Additional information can be found on the World Shipping Council website here. A page containing the full JOC coverage of the issue is here.
This FAQ has been updated as of Jan. 27, 2016 and we will continue to update it as more information becomes available.
– There is the beginning of political pushback to the rule. The U.S. Agriculture Transportation Coalition is complaining in Washington that the rule is unworkable and would disadvantage U.S. exporters. See 21) Below (updated Jan. 27)
– A source at the International Maritime Organization said there are currently no efforts under way to delay implementation of the SOLAS container weight rule, See 2) below.
– Sources are saying that China factories won’t be willing to invest in weighing equipment, complicating shippers’ efforts to provide carriers with required VGM. See 7) below (updated Jan. 20)
– Another Method 2 issue is that packing cartons are printed well in advance of packing, and the weight printed on the carton may be different to the mass of the contents, see 16) below (updated Jan. 20).
– Complying with the new SOLAS VGM rule is mandatory, so carriers will not have a choice of whether or not to accept containers without a VGM, see 2) and 12) below (updated Jan. 20).
– Some shippers are concerned that contract manufactures who conduct the weighing may be unreliable and need to be monitored. See 7) below
– A port equipment maker says marine terminals won’t practically be able to weigh containers at the gate. See 9) below
1) At a basic level, what is the new requirement put on shippers?
Under the new SOLAS VGM (verified gross mass) requirement, the shipper named on the ocean bill of lading is the party responsible for providing the container carrier and the terminal operator with the verified gross mass of a packed container. The carrier and the terminal operator must not load a packed container aboard a ship unless they have the verified gross mass for that container. The “shipper” according to MSC 1 / Circ. 1475 (the IMO’s guidance on VGM), is “a legal entity or person named on the bill of lading or sea waybill or equivalent multimodal transport document as shipper, and/or who (or in whose name or on whose behalf) a contract of carriage has been concluded with a shipping company.” This responsibility shipper doesn’t go away if a shipper uses a forwarder to pack and weigh a container, forward it to the port and even make the booking with the carrier. If the forwarder is acting purely on the instructions of the shipper to undertake that work on his behalf, and the shipper’s name is still what appears on the bill of lading, it’s the shipper that is responsible for verifying the gross mass weight. The shipper will have to ensure that it’s satisfied with the integrity of the forwarders’ weighing process if it’s relying on the forwarder’s measurement.
2) How will the rule be enforced, and what are the risks for shippers?
Certain basic facts are known. The rule will be officially enforced by the maritime authorities of individual nations, whose implementing regulations will vary, potentially widely depending on country and region. As a practical matter the real-world “enforcement” that will affect shippers most directly seems most likely to be carried out directly by the container lines and terminal operators, who are both required not to load a container without the certified VGM document accompanying it and to use the VGM for stowage planning. Enforcement agencies may implement measures to satisfy themselves that compliance is achieved, which could include documentation checks, auditing or random weight checks. The carriers and terminals are expected to be disciplined in their unwillingness to accept containers tendered to them without the required VGM documentation in order to avoid costs and penalties such as delayed sailings, to avoid costs for the storage and handling of affected containers which could congest terminals and which might be difficult to recover from the shipper, and especially to avoid liability in the event of a casualty whether at the dock or at sea. Hapag-Lloyd in a brochure on the issue said “A packed container, for which a verified gross mass has not been obtained, will not be loaded on the vessel.” Thus, “the risk is your container won’t get shipped. It would be turned away from the terminal,” said Global Shippers Forum secretary general Chris Welch told JOC.com in an interview in October. Some, though not all, terminal operators are considering introducing weighing services as a revenue stream and to assist non-compliant containers to be loaded, as this paper from the Port Equipment Management Association suggests. Some terminals like Maher at New York-New Jersey are saying they will explictly not offer weighing services on their facilities and will turn away non-compliant containers at the gate. But not all terminals are expected to adapt such a stringent “no VGM, no in-gate” position since carriers would likely see this as disrupting the flow of their customers’ cargo. As a practical matter no container with a VGM will be included on the “terminal load list” which is the list of all containers to be loaded provided to the terminal by the ocean carrier prior to the loading of each ship. At the same time, some are speculating that since many shippers are telling carriers that they won’t be ready for implementation of the rule on July 1 (see report on Inttra shipper survey released on Dec. 1) there may need to be some kind of an initial soft launch, similar to how U.S. container security measures were implemented, following by a hard launch when penalties would take effect. Or if confusion continues to grow some may seek a delay in implementatoin. But that is mere speculation at this point. In fact, an IMO source said in late January, 2016 that no efforts were currently under way to delay the ruling. Some goverments like the UK have begun to issue guidelines for example for certifying those who will be carrying out Method 2 weighing procedures (that is, weighing the contents of the container and adding that to the tare weight, or unloaded weight, of the container).
3) When does the new regulation take effect?
The new regulation, called Verified Gross Mass, takes effect on July 1, 2016, and will apply to all containers loaded for export on or after that date, from any port in the world. Containers loaded prior to July 1 that are already in transit once the new rule is imposed will not be affected.
4) Will legislation be required by each country to make the convention law at their ports?
No. The rule is law in each of the 170 countries and three IMO associate member countries that are signatories to SOLAS. The reason is that SOLAS has international legal status so there need not be any further implementing legislation for states that are party to it. There has been no precedent for non-implementation or delay in the implementation of a SOLAS regulation, so there is no reason to expect any delay in implementation beyond July 1, 2016, although due to the many complexities that are arising and described at various points within this Q&A, some are beginning to say that a delay or phased in approach may be neede. As an United Nations agency, the IMO leaves it to each of the individual countries to implement the ruling, which means that the exact system of penalties and procedures is left to each government and managed by the agency representing IMO in the respective country, for example the Coast Guard in the U.S., or the Maritime & Coastguard Agency in the U.K. The exact timing of regulations being promulgated and enforced will inevitably vary country by country. That said, it is understood that several countries’ agencies are currently investigating how to prevent the loading of container without the VGM submitted. However the potential for lack of uniformity in the implementing regulations among countries has created alarm.
5) What is meant by the requirement for a “signature” on the VGM document?
What the SOLAS rule requires is that the shipper communicates the verified gross mass in a “shipping document.” It must be signed by a person duly authorized by the shipper, with a first and last name, not just a company name. The signature may be an electronic signature or may be replaced by the name in capitals of the person authorized to sign it. The VGM and signature can be part of the shipping instructions communicated via electronic data interchange (EDI), or be contained within a separate communication including a hard copy document. In either case, the document should clearly highlight that the gross mass provided is the “verified gross mass.” There is no requirement that a so-called “weight ticket” generated by a weighbridge be presented, but national implementing regulations may require that shippers using Method 1 (weighing of the cargo and container as one) produce weight tickets or other documentation upon request.
6) How will the signature and documentation be handed off from one party to the next in the supply chain?
This is an area where regulations won’t apply and it will be a matter of coordination among parties, with processes very much still to be worked out as of early 2016. According to a Q&A published in December by the World Shipping Council, the Global Shippers Forum, TT Club and ICHCA International, “There are inevitable process challenges to ensure effective coordination between the shipper and hauler to achieve effective documentary handoff (whether electronic or paper) to avoid in-gate delays. Such processes should be discussed between the commercial parties, including the maritime carrier and the terminal operator.” In reality, electronic communication will need to be core to how the signature is passed from party to party, though use of electronic data interchange or other electronic platforms is far from universal within the industry. Maher Terminals at the Port of New Jersey said it will it not accept containers without an electronic signature sent via EDI. The ocean carrier portal Inttra which facilitates electronic documenation has been active in the issue, indicating the importance of EDI and other electronic systems in implementing the rule.
7) When sourcing from contract manufacturers at origin countries, will retailers, consumer product firms and others rely on their manufacturers to conduct the weighing at the origin?
Most shippers use third-party logistics companies (3PLs) to pack and transport containers to ports. Therefore, it is fair to expect that contracts for contract logistics and freight forwarding services will be amended to reflect the VGM requirement. Shippers can expect 3PLs to try to assess an incremental fee to weigh containers. It is unrealistic to expect the shipper themselves to perform this work themselves in most cases since they lack resources, space and staff able to undertake the actual weighing of cargo or loaded containers. Therefore all 3PLs and freight forwarders will have to offer such services in some form, but in order to minimize supply chain disruption as the implementation date approaches in 2016, a customer should inquire early to be certain that the requirement can be met. In situations where the manufacturer loads the container, the shipper – who is the responsible party under the rule – will have to leverage vendor-compliance tools and processes to ensure that the weight the manufacturer states for the bill of lading is the real weight that will hold up in an inspection. But this opens the door to risk; according to one shipper interviewed by JOC.com in January, “what goes on the paper might not be what is in the box, and that will leave us with a serious problem. We will have to enforce the rule at all our vendors.” According to some sources, China factories will be reluctant to invest in weighing equipment and overall are shrugging off the impending rule.
8) Are shippers that only tender partial loads to a forwarder or master loader responsible for providing a VGM?
No. The responsibility for providing the accurate, verified gross mass of a co-loaded container remains with the shipper named on the maritime carrier’s bill of lading, i.e. the “master” loader or freight forwarder. The contractual terms between the ultimate shipper and a co-loader may allow the shipper to provide a VGM to the master loader, or the master loader or forwarder might undertake the weighing process themselves, but either way this would be a commercial arrangement between those parties. However, the situation could be different in the case of full container loads that move under NVOs’ contracts with the carriers. One larger trans-Pacific NVO told us in mid-December that he expected the NVO to require the shipper to provide the weight of the cargo even if, according to the rule, it is the NVO as the official shipper on the bill of lading who will be required for presenting the VGM to the carrier. However as of mid-December NVOs had not disclosed their official policies. Still, for shippers shipping full container load boxes under an NVOCC bill of lading, they will most likely have to provide a weight to the NVO which would include the figure on its own bill of lading. For shippers using NVOs that consolidate boxes on their behalf – a business dominated by carrier-owned or former carrier-owned NVOs like APL Logistics, Yusen Logistics and Damco, those NVOs will need to undertake the weighing directly themselves in order to be in compliance.
9) Is it most feasible for the weighing process to take place at the port or earlier in the supply chain?
There is a lot of debate and discussion around this issue currently. According to Inttra, it is unrealistic to expect weighting units to be installed at ports in even close to a necessary quantity to weigh every container prior to loading. In most cases, even if the capital and equipment existed, there is simply not enough physical space or related infrastructure (such as roads and cranes) to accommodate weighing for all containers at every port in the world. Maher Terminals at New York-New Jersey said recently that it does not have the capacity to perform weighing services, and we are hearing that most U.S. terminals are adapting the same or similar position. However some port equipment providers are advocating that terminals consider providing weighing services to help shippers comply, offering suggestions about where within their facilities containers could most feasibly be weighed. One port equipment manufacturer said in a recent presentation that weighing at the terminal gate would be difficult since some trucks arrive with two 20-foot containers, while others have noted that use of a weighbridge that weighs the full truck is an imprecise measurement since the weight of the truck and any fuel would have to be subtracted out. Weighing using the ship-to-shore gantry crane is considered too late for the weight to be used for the vessel stowage plan- a requirement that the new rule puts on container lines. Thus the suggests that terminals, if they are to get into the business of weighing containers, should do it in the stacking yard. But there there are also challenges and investment required by termials. According to the monitoring equipment provider Strainstall in a recent white paper, “With the 2016 SOLAS regulations in force, it is likely that all new container handling equipment will be designed from the outset to incorporate container VGM (verified gross mass) technology. Other than for the very few new installations currently in planning, however, SOLAS compliance will need to be achieved via the installation of retro-fit solutions onto existing assets.” It is unclear how many terminals globally are making this investment. APM Terminals said for example that it is considering weighing services and other SOLAS rule-related services at some ports. More realistically, however the most likely scenario in most cases will be for the cargo and the container to be weighed separately at origin, under Method 2, and the total weight provided as the VGM with a certified signature. However for some cargoes like scrap metal that is loose and difficult to be weighed on its own, it will be necessary to weigh the packed container on a chassis and subtract the chassis. This can potentially be performed at weighing stations at distribution center facilities or independent stations. It means adding time and cost to the contract for the beneficial cargo owner (BCO) with the trucking company and weighing station, as well as capabilities to receive details from them for submission to the carrier. The documentation submitted to the carrier has to come from the BCO or been authorized in a way that prevents fraud and accounts for liabilities. For standard and smaller items — palettes, crates, parts or smaller industrial equipment — the weighing will most likely be performed at the facilities where the packing is done, whether it is BCO owned or a freight forwarder’s distribution center. The latter usually have weights for such items but again, the parties need to augment existing commercial agreements to account for labor, costs and time. In some cases it results in adding more weights to the facilities. In a dedicated distribution center, the customer may have to pay, in a multi-customer DC, the freight forwarder has to pay but will most probably pass over the cost.
10) What will happen if a container is turned away at the terminal gate or allowed into the terminal but not allowed to be loaded?
Containers may get turned away at the gate if they lack the required VGM. Marine terminal operators, already combating congestion due to mega-vessels are concerned that accepting non-compliant containers which by law cannot be loaded risk further congesting their facilities. There are two scenarios if a container gets turned away, one if the container does not arrive at the terminal with the required VGM document and is turned away, and two if it is allowed into the terminal but is subject to a random check and the weight is determined to be different from the declared VGM weight. In the first case arrangements will have to be made to transport, store and weigh the container so a certified VGM can be presented to the carrier and terminal. This will by definition involve additional trucking and storage cost to the shipper, which is leading carriers to be particularly focused on assisting shippers to ensure that containers don’t arrive at the gate without the VGM. In the second scenario, the terminal will initially sequester and store the container and will most likely charge appropriate fees, on top of any fines assessed. How each terminal will handle overweight containers is one of the murkiest issues of the container weight mandate. For example, in reference to the question just above this one, it is unclear how many terminals will equip themselves to perform weighing services for containers that arrive at the terminal without a VGM.
11) What is the shippers’ deadline to provide the required container weight verification to the ocean carrier?
The VGM “cutoff” will vary by carrier and port and is not mandated by the SOLAS requirement. However practically speaking it must arrive early enough for the carrier to use the VGM figure in its stowage plan, which is a requirment the SOLAS rule puts specifically on the terminal and carrier. Given that many terminals will not be offering weighing services and will refuse entry to any containers that arrive unaccompanied by the VGM, practically speaking the VGM will have to be in the terminal’s hands prior to the in-gate cutoff for a particular sailing. Some U.S. carriers however are saying that terminals should be able to in-gate containers with no VGM if it is provided quickly thereafter so as not to disrupt the normal flow of the container from the in-gate through to loading on the vessel. Ultimately any deadlines imposed will be a commercial matter that is not determined by regulation, and could reflect the specific needs of certain just-in-time or high priority cargo provided, as determined by the relationship between the carrier and the terminal and provided the carrier can still use the VGM in its stowage plan. This is where commercial relationships among the shipper, carrier and terminal operator will come into play as it relates to certain cargoes such as bulk exports that are loaded into containers near the port and sent to the terminal in large quantities. A system among the commercial parties will be required to prevent delays to such cargoes. Shippers are already concerned that cutoff times may vary widely among carriers. “The primary concern is that there is no standard process that carriers are using to implement this regulation. Many of us have received emails and alerts educating us that this rule is coming, but with no content on the procedure,” Donna Lemm, vice president at Mallory Alexander International Logistics, wrote in a JOC.com commentary in October. Carriers can be expected to provide shippers with cut-off times within which the carrier must receive the required container weight verification from the shipper for vessel stowage planning prior to shipment. This will likely be a newly imposed cutoff time separate from terminal arrival cutoff to make a certain vessel sailing.
12) Can a carrier enforce the rule selectively for certain shippers but not others?
Likely not. Enforcing the rule will start with government agencies — not carriers — with the container simply not allowed to be loaded without the required documentation. The size or importance of the customer to the carrier would not matter. The only area where carriers will have flexibility is concerning how penalties that get assessed are passed to customers, and how selectively they do it. This is important, because while the legal responsibility for submitting VGM lies with the shipper, the carrier is also required not to load container unaccompanied by the VGM. “It is law, and the liabilities (for a carrier) associated with not complying are really enormous” for example if an accident occurs whether at berth or at sea and it were discovered that no VGM had been submitted for a container that may have been involved, World Shipping Council Chairman Ron Widdows told JOC.com on Jan. 19. But if a carrier cannot load a container, the carrier suffers monetary costs — for loss of revenue and any terminal and handling costs associated with a container that was rejected by the terminal for lack of a VGM — even before any fines by the relevant maritime authority. Thus most carriers can be expected to do whatever is necessary to assist the shipper to obtain the VGM information for a container sufficiently in advance of its arrival at the terminal. While some carriers such as Hapag-Lloyd and Crowley have stated already that they will not load containers without the VGM, the reality is the rule is law worldwide and thus compliance is not a matter of choice for the lines. The gate-in event for a container becomes the moment of truth — whether at port or railhead since after that point any costs associated with the container’s rejection becomes the carrier’s responsibility, unless it’s known in advance that the terminal will weigh the container on behalf of the shipper. But as answers above indicate, it is not yet clear at all which terminals or how many will offer weighing services or who they would even charge for the service. Certainly container lines will want to avoid a scenario where a terminal bills the carrier for weighing a container given the lack of a guarantee that the carrier will be able to pass that bill along to the customer.
13) Are carriers and terminals required to verify the accuracy of the VGM submitted by the shipper?
No. The requirement is for the carrier and terminal operator to ensure only that the VGM has been communicated in sufficient time to be used for stowage planning, and to not load a container for which a VGM has not been provided. There is no legal obligation on the carrier or terminal to confirm the VGM communicated by the shipper, and there is no requirement for the VGM to be conveyed to relevant governmental authorities. There is also no requirement that the carrier or terminal operator weigh a loaded container for which the shipper has failed to provide the VGM, and some terminals are already stating that they will not have services available to weigh containers that arrive at the terminal unaccompanied by a VGM.
14) What costs is the shipper looking at for non-compliance?
Actual payment fees for non-compliance have largely not been established or published yet by national governments, but the costs for failing to present a certified VGM document can be expected to go way beyond any actual penalties assessed. In terms of penalties, “Depending on national legislation, national maritime administrations can levy punishments ranging from fines and sanctions to jail time. In the U.K., fines and imprisonment are possibilities,” said Global Shippers’ Forum Secretary General Chris Welsh in a Q&A with JOC.com. But there will be other costs as well. Taking a container off a ship and resulting storage will result in costs applied to the carrier by the terminal. Therefore shippers can expect a non-selective approach by carriers to cost recovery especially now when historically low freight rates in certain East-West trades are leaving container lines with little in the way of profits and a high motivation to recover costs applied to them by marine terminals. Carriers can thus be expected to put preventative measures in place to avoid these costs by ensuring they receive the VGM and refuse to accept containers without it.
15) Under the new rule there are two two methods by which a shipper may obtain the verified gross mass necessary for submission to the ocean carrier. What are they?
The two options are Method 1 and Method 2. Method 1 is that upon the conclusion of packing and sealing of the container, the shipper weighs the packed container itself, or arranges for a third party to do it. Under Method 2, the shipper or a third party working on behalf of the shipper may weigh all the packages and cargo items in the container, including the mass of pallets, dunnage and other packing and securing material to be packed in the container, and add the tare mass of the container to the sum of the single masses of the container’s contents. (The tare mass, also called unladen weight, is the weight of an empty container. The tare mass of every container is marked on the exterior of every container at the time of manufacture. Shippers should solely rely on the tare mass number marked on the individual container being used, and should not use a standardized weight for any 40-foot container. Where it is missing, or believed to be inaccurate, the container operator should be contacted to take appropriate remedial action.) Some governments will require approval for those who carry out Method 2 weighing processes. The UK Maritime & Coastguard Agency government states this in an official document providing guidance to shippers on implementing the rule. Usage of Method 2 “requires that the MCA has to approve the certified method used by that shipper.”
16) Are there situations where the cargo doesn’t have to get physically weighed?
Yes, under Method 2, which allows the contents of the container as well as any bracing materials to be weighed separately and then added to the tare weight (empty weight) of the container, it is possible to sum up the weight of individual sealed cartons where the weight is known in advance and use this figure in the total weight calculation. This method qualifies “so long as the weight is clearly and permanently marked on the surface of each individual sealed package to be stuffed into the container,” according to a World Shipping Council spokesperson. “And then the weight of any bracing and securing material, derived by weighing such material, is added along with the tare weight of the container to attain the verified gross mass (VGM) of the loaded container.” For example, according to the WSC, “a shipper of identical television sets whose individual cartons are marked by the manufacturer with the shipping weight could calculate the shipment’s weight by multiplying the number of television sets in the container by the weight of an individual set, and then adding that to the weight of the combined calculated weight of the packaging, pallets, packing and bracing material and the container’s tare weight. This approach has four required elements: It only applies to 1) original, sealed packages, 2) that have been previously weighed, 3) with the accurate mass clearly and permanently marked on their surfaces, and 4) such weights being added to the calculated weight of all packing, securing and other material that may have been used in the packing of the container.” The WSC spokesperson added: “We understand this exception will apply to a very small percentage of the total cargo to be moved.” However, shippers have pointed out that cartons are made and the weight printed well in advance of the product being packed inside, which could lead to possible discrepancies in the weight of the finished product and its accessories under Method 2. With thousands of boxes in a container, even small discrepancies can make a significant difference to the declared weight.
17) What are the necessary requirements for those doing the weighing, the weighing equipment itself, and accuracy?
The weighing equipment to be used must meet the applicable accuracy standards and requirements of the country in which the equipment is being used. There is no such thing under SOLAS as a “verified weigher.” The only obligation under SOLAS for any party weighing a packed container is to use equipment certified by the relevant national standards. But national standards may get more specific, for example national governments may as part of their enforcement policies implement requirements applicable to owners of weighing equipment and could determine acceptable levels of accuracy of the weighing equipment used. There is no provision in the SOLAS rule for any margin of error; the rule is only a physical weighing requirement, thus verified gross mass derived using compliant equipment and procedures will meet the legal requirements. Some cargo products may incur normal, minor changes in mass from the time of packing and weighing until delivery (e.g. due to evaporation or humidity changes) and some containers’ tare mass may change over time and vary somewhat from the tare mass marked on the container. However, these margins of error should not normally present safety concerns.
18) Why was the container weight rule put into effect?
Simply put, shippers — not all of them but unfortunately still too many — misdeclare cargo on the bill of lading, whether out of sloppiness, negligence or willful intent to ship more cargo than allowed for the same rate. The impact on safety to workers, ships and cargo can be catastrophic, as these examples indicate. Misdeclarations apply both to weight and cargo descriptions, though the IMO VGM rule applies only to weight. When cargo is misdeclared, since the cargo itself isn’t visible and the ship master’s knowledge of the cargo on board the ship is limited to what is stated on shipping documents, there is significant danger inherent in shipping by container. This rule aims to crack down on one aspect of misdeclarations, that applying to weight, in the hope that the safety of container shipping will improve and overall risk be reduced. “Misdeclared container weights have been a long-standing problem for the transportation industry as they present safety hazards not only for ships and their crews but for other cargo on board as well as workers in port facilities handling containers and on roads,” Matthew Gore of the law firm Holman Fenwick Willan wrote in a 2014 bulletin.
19) Why does it appear that there is no leadership or coordination to efficiently get the rule implemented by July?
Part of the reason why there appears to be so much confusion, at so many levels, has to do with who’s rule this is. The International Maritime Organization is primarily concerned with ship safety and ship operations. The SOLAS convention that was amended to create the rule refers to “Safety of Life at Sea” and traces its origins to the sinking of the Titanic. The IMO has little institutional knowledge of or experience with issues beyond the vessel and especially not into the origins of the supply chain at manufacturing sites where some containers or contents will be weighed possibly hundreds of miles inland from seaports. It is safe to say that in implementing the rule the IMO and others involved were not able to fully envision the complexities involved in complying with the rule, and as a result left the details to commercial parties to work out on their own, with little if any practical guidance other than to say that containers not accompanied by a VGM can’t be loaded on the ship. That is why this rule is proving so difficult for so many to get their arms around. The rule brings to mind the U.S. Importer Security Filing, also known as “10+2” to refer to the data points that importers were required beginning in 2009 to submit to U.S. Customs 24 hours prior to the ship sailing from the foreign port. Complying with that rule had significant supply chain implications for U.S. importers, but the rule only applied to the U.S., whereas the VGM rule will be enforced by 171 nations. “Those who wrote the rule have no idea of the complexity of cargo movements through the ports,” Agriculture Transportation Coalition Executive Director Peter Friedmann told JOC.com in late January.
20) Is there any global EDI standard in the works to implement the SOLAS VGM rule?
Yes, the UN EDIFACT message standard described in this 85-page document has been published by the standards setting body SMDG, a nonprofit that develops and promotes UN/EDIFACT EDI-messages for the maritime industry and is an official Pan European User Group recognized by the UN/EDIFACT Board. But it’s not yet clear how universal the standard’s adaption will be globally and obviously it won’t apply to the significant amount of cargo whose documentation is currently submitted via hard copy, fax or other non-electronic means.
21) Is there political pushback to the IMO rule?
Yes, though whether any change to the current time frame, which has the rule being implemented on July 1, is speculative, and as the World Shipping Council has pointed out, there is no precedent for the implementation of an IMO rule being delayed. Peter Friedmann, executive director of the U.S.-based Agriculture Transportation Coalition, said that since complying with the rule could impact the competitiveness of U.S. exporters relative to exporters from other nations that he says may be lax in their enforcement of the rule. The group has approached the Federal Maritime Commission and members of Congress to express concerns that the rule is unworkable in its current form. For example, U.S. exporters of transloaded agricultural goods, that is, goods that are shipped to the coast via truck or rail and transloaded into containers, may be unable to provide the VGM to the carrier quickly enough to allow a smooth flow of containers through a terminal and on to a ship. For its part, an IMO source said in late January, 2016 that it was aware of no effort to postpone the effective date or implement a phased in approach. According to Friedmann, “Everyone who knows about how cargo moves from the origin and onto a ship knows that this thing is absolutely unworkable and will create unbelievable congestion unless minds who are familiar with how cargo moves are allowed to intercede.”