UASC SCHUAIBA, containership

UASC Settles With U.S. Federal Maritime Commission Over Shipping Act Violations

Mike Schuler
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August 4, 2015

Image: R.Almeida/gCaptain


The U.S. Federal Maritime Commission says it will collect at total of $1,227,500 in civil penalties after reaching settlement agreements with eight common carriers over violations of the Shipping Act.

Dubai-based United Arab Shipping Company, the only vessel-operating common carrier (VOCC) involved in the settlement, will pay the lion’s share of the penalties, agreeing to pay $537,500 to the FMC.

According to the FMC, it was alleged that UASC violated 46 U.S.C. 41104(1) by unlawfully rebating to its non-vessel-operating common carriers (NVOCC) customer, Falcon Maritime and Aviation Inc., a portion of the applicable service contract rate in the form of an administrative fee not identified in the service contract, and for which no services were provided. 46 U.S.C. 41104(1) says that a common carrier, either alone or in conjunction with any other person, directly or indirectly, may not allow a person to obtain transportation for property at less than the rates or charges established by the carrier in its tariff or service contract by means of false billing, false classification, false weighing, false measurement, or any other unjust or unfair device or means.

UASC also violated 46 U.S.C. 41104(2) by providing transportation not in accordance with the rates and charges in its published tariff, the FMC said.

The FMC says that the eight common carriers, including seven NVOCCs, settled after investigations conducted by the Commission’s Area Representatives in New York and Seattle, and headquarters staff in Washington D.C. In all cases, the eight parties agreed to the settlement but did not admit to and wrongdoings.

In making the announcement, Chairman Mario Cordero stated: “I commend the staff at FMC in fulfilling their responsibility to protect the American shipping public from entities who may be in breach of the Shipping Act. The compromise agreements demonstrate how serious we are about protecting the international shipping marketplace from fraud and threats to cargo security, and in our commitment to shield the many lawful participants in international trade from commercial deception and other unlawful trading practices.”

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