Forwarders hit back at 'shipping monopoly' and 'no limit' box detention fees

Ecuadorian forwarders are fighting back against a “major trade risk” presented by what they call the “monopolisation” of the shipping sector, and unregulated container detention fees.

Speaking to The Loadstar at Fiata’s World Congress, president of Latin American forwarding association Alacat, Galo Molina Aguilar, claimed shippers were being “taken advantage of”.

“Not only are the carriers taking advantage of shippers by collecting fees for the detention of containers, they are failing to invoice separately for these fees,” said Mr Aguilar.

He said such fees were rarely itemised in carriers’ invoices, while the reduction in number of lines had left the incumbents with even less incentive to invest in customer service.

“Consolidation among the carriers has only exacerbated this problem by creating a monopoly, which is creating a major trade risk,”

Detention fees are leveraged by shipping lines when containers are held for longer than agreed to under contracts with shippers. Mr Aguilar said he had “no problem” with this practice, noting that the detention was not the fault of the carrier but rather a customs issue.

“The problem is the lack of regulation surrounding how these fees are applied and invoiced, and the lack of limits on what they can charge for detention,” he continued.

“They are exploiting problems, and this exploitation ultimately hits customers as it increases the costs of the goods being shipped.”

According to Mr Aguilar, the Ecuadorian government has agreed to take action on the issue and is pushing through legislation to regulate these costs.

He said international freight forwarder association Fiata was working with Alacat on recommendations it would share with other governments on how best to limit these costs.

“We’re pleased with the Ecuadorian government’s actions to alter these carrier practices, but more is required,” said Mr Aguilar, who runs forwarder Planet Cargo. “This has to happen – has to be solved – at a global level, it cannot only happen at regional levels if it is to have any hope in working.”

The US Federal Maritime Commission is also undertaking an in-depth investigation into demurrage and detention fees applied in the US following a series of complaints from shippers and freight forwarders.