FMC fines NYK and K-Line

The FMC has fined  K-Line and NYK.  The press release says they violated 46 U.S.C.  41102 listed below.

My best guess is they were buying space from each other without having a space agreement on file at the FMC, and they were not charging each other as per the tariff.   

I recall carriers doing this, thinking there was nothing wrong.  It didn't use to be difficult to file these type of agreements (perhaps it is now).  Not knowing, or caring, about U.S. law cost each of these carriers over 1 USD million a piece.

Maybe that's not much money to them.

click here for press release (also quoted below)

Here's the section of the law they violated.

§41102. General prohibitions

(a) Obtaining Transportation at Less Than Applicable Rates.—A person may not knowingly and willfully, directly or indirectly, by means of false billing, false classification, false weighing, false report of weight, false measurement, or any other unjust or unfair device or means, obtain or attempt to obtain ocean transportation for property at less than the rates or charges that would otherwise apply.

(b) Operating Contrary to Agreement.—A person may not operate under an agreement required to be filed under section 40302 or 40305 of this title if—

(1) the agreement has not become effective under section 40304 of this title or has been rejected, disapproved, or canceled; or

(2) the operation is not in accordance with the terms of the agreement or any modifications to the agreement made by the Federal Maritime Commission.

(c) Practices in Handling Property.—A common carrier, marine terminal operator, or ocean transportation intermediary may not fail to establish, observe, and enforce just and reasonable regulations and practices relating to or connected with receiving, handling, storing, or delivering property.

And here's the press release from the FMC

December 23, 2013

NR 13-19

Contact: Karen V. Gregory, Secretary (202) 523-5725
The Federal Maritime Commission announced compromise agreements reached with two common carriers operating pure car carriers (PCCs) and roll on/roll off (RO/RO) vessels in U.S. inbound and outbound trades. Under these separate agreements, Kawasaki Kisen Kaisha Ltd. (K Line), paid $1,100,000 in civil penalties and Nippon Yusen Kaisha (NYK Line), paid $1,225,000 in penalties. Both carriers are headquartered in Tokyo, Japan, and operate diverse fleets trading in the U.S.-foreign trades and globally.
The compromise agreements resolved allegations that K Line and NYK Line violated provisions of the Shipping Act, including section 10(a) of the Shipping Act, 46 U.S.C. § 41102(b), by acting in concert with other ocean common carriers with respect to the shipment of automobiles and other motorized vehicles by RO/RO or specialized car carrier vessels, where such agreement(s) had not been filed with the Commission or become effective under the Shipping Act. The compromise agreements also addressed related activities and violations. Commission staff alleged that these practices persisted over a period of several years and involved numerous U.S. trade lanes, including from and/or to the Far East, Europe, the Middle East and South America.
Chairman Mario Cordero stated: "These penalties underscore the seriousness with which the Commission views the carriers’ obligation to file with the Commission any agreement with other carriers affecting working relationships in the U.S. trades, both for import and export traffic. The shipping public has a right to know the subject matter and scope of any such agreement, and the Commission is charged by Congress to oversee the parties’ operations and conduct under such agreements. Investigations by our Bureau of Enforcement as to additional carriers implicated in similar agreement activities are continuing at this time."
In concluding the compromise agreements, K Line and NYK Line agreed to provide ongoing cooperation with other Commission investigations or enforcement actions with respect to these types of activities. The carriers did not admit to violations of the Act or the Commission’s regulations. Staff attorneys with the Commission’s Bureau of Enforcement negotiated the compromise agreements.
The Federal Maritime Commission (FMC) is the independent federal agency responsible for regulating the nation’s international ocean transportation for the benefit of exporters, importers, and the American consumer. The FMC’s mission is to foster a fair, efficient, and reliable international ocean transportation system while protecting the public from unfair and deceptive practices.

Increased Tonnage Europe/U.S.

I don't really know why carriers would add tonnage at this time, but they are.

This is a press release.

Hamburg Süd and partners to upgrade Transatlantic Service



Hamburg, 19 December. In collaboration with Hamburg Süd and ZIM, Grand Alliance members Hapag-Lloyd, NYK and OOCL have decided to upgrade their tonnage deployed in the Transatlantic Service between Europe and North America East Coast. As from March 2012 instead of four 3,700 TEU vessels, four 5,400 TEU ships are then to come into operation. As hitherto, Hamburg Süd and ZIM will each provide one vessel and Grand Alliance two.



The weekly fixed-day service continues to have the port rotation: Rotterdam – Hamburg – Le Havre – Southampton – New York – Norfolk – Charleston – Rotterdam

Tracking the BBC Box

The BBC Box is onboard NYK Virgo, Voyage 14. It left Singapore on Oct. 5th, and is due in Southampton, UK, Oct. 21st.

It started out in Laem Chabang, Thailand, on Sept. 29th, on the NYK PHOENIX/045, and was transshipped in Singapore.

It is carrying canned dog food (or, as the Brits say, tinned dog food)

click here for link to NYK tracking site.

Input the container number, prefix and number (no spaces).

NYKU8210506

NYK to raise money through bonds

The Journal of Commerce reports

NYK Line said today it will issue two sets of unsecured $315 million bonds in a public offering on Aug. 11 to raise cash for its operations.

The first bond issue, which is named Unsecured Straight Bond No.28, has a five-year maturity and an annual coupon of 0.968 percent.

The second, Unsecured Straight Bond No. 29, has a 10-year maturity and bears an annual coupon of 1.782 percent.

NYK said both bond offerings have been rated AA by two Japanese rating agencies, the Japan Credit Rating Agency and Rating and Investment Information.

These are not paying that much interest, especially for something which is unsecured.
However, they will be sold in the Japanese market, so perhaps there are some tax advantages.

I'm a little surprised by the rating, since they lost so much money recently, are projecting a loss for the full year, and probably next year too.

NYK lost $262.7 million for the first quarter of its fiscal year ended June 30, compared with a profit of $610 million a year earlier. Group revenue for the three-month period fell by 41 per cent during the quarter, down to $4 billion from $7.1 billion a year earlier, as the financial crisis cut into volumes and freight rates.

The largest Japanese shipping line revised its forecast for the full year to a loss of $52.5 million, from an earlier forecast of a $190 million profit, with total revenue of $17.9 billion.

click here for link

The BBC Box loaded in Brazil

The BBC Box, NYKU8210506 was loaded by the shipper in Brazil and returned to the port of Santos on March 16th. There is no update on BBC regarding this movement.

The following is from the NYK tracking site

Current Date: Mar-18-2009
Container Search Results

Container NYKU8210506 Container Size/Type 40'/DRY

Status As Of Event Location Mode
MAR-16-2009 08:00 Arrived at first port of load Santos, BRA Truck

Moves to Date Event Location Mode
MAR-13-2009 15:30 Empty container positioned to shipper Santos, BRA

This container should load on a vessel going to Japan. I haven't checked the schedule to try and figure out which ship.

As cargo must clear Brazilian customs before it can be exported, I guess it should load on a ship by March 22nd or so.

BBC Box arrives Santos, Brazil

The vessel carrying the BBC box has arrived in Santos on Feb. 6 (1 day earlier than expected). However, the NYK web-site does not yet show the container unloaded from the vessel M/V Iwato, voyage 017.

Container NYKU8210506 Container Size/Type 40'/DRY

Status As Of Event Location Mode
FEB-06-2009 12:30 Vessel Arrival Santos, BRA IWATO/017

You can check the status yourself on the NYK web-site. You must input the full container number (prefix and numbers, no spaces) NYKU8210506.

BBC Box due Santos, Brazil Feb. 7, 2009

Here's the update on the BBC box, NYKU8210506.

It sailed from New York on Jan. 12 with household goods destined for Santos, Brazil.

I finally found the vessel Iwato in the NYK web-site. It's due into Santos, Brazil on Feb. 7th.

ANS JAN-09 New York JAN-09 New York JAN-12 IWATO/017 Santos FEB-07 FEB-08 Santos 29d 10h

As of today the BBC site hasn't been update with the ETA, so I guess once again they want to keep this under wraps.

BBC Box loaded on M/V Iwato voyage 017

According to the NYK tracking site, the BBC Box loaded onboard a vessel. M/V Iwato Voyage 017

However, there is no such vessel/voyage from New York to Santos, Brazil in the NYK sailing schedule. In fact, their web-site says this service has been discontinued.

The BBC site said it would take 3 weeks for the container to reach Santos, which is really too long of a transit, so my only guess is they are transhipping this container somewhere.

Here are the results from the NYK tracking site. If you want to look for yourself, you must input the container number - all letters and numbers with no spaces.

Container Search Results

Container NYKU8210506 Container Size/Type 40'/DRY


Status As Of Event Location Mode
JAN-12-2009 11:43 Loaded on vessel at first port of load New York, NY, USA IWATO/017

The BBC Box bound for Brazil

BBC advised The Box is loaded and going to Brazil. They aren't giving out much information. I don't know if it's because they don't have the staff to cover this story, or if everyone is trying to keep the info under wraps.

PROJECT UPDATE
The Box will be leaving New York next week bound for Santos in Brazil. The journey should take about 3 weeks. It will be carrying a cargo of household goods

Even the NYK tracking site only shows a location as NYC. It really should show the terminal location, so probably this data was forced into the system.

Container NYKU8210506 Container Size/Type 40'/DRY


Status As Of Event Location Mode
JAN-09-2009 11:28 Arrived at first port of load New York, NY, USA


It's interesting that the goods in this container are Household Goods. Probably some Brazilians moving back due to the downturn in the U.S. economy. I don't really know how the Brazilian economy is doing, but you can live pretty cheap in Brazil if you choose. Retire to a small seaside town. Not a bad life.

The BBC Box is empty in New York

According to the NYK tracking site, the BBC Box has been returned empty after being unloaded by the latest consignee, BigLots. Their warehouse (or distribution center) is in Pennsylvania. It was picked up by truck in Jersey City NJ, unloaded, and the empty container was returned to New York (so it says).

NYKU8210506 Container Size/Type 40'/DRY

Status As Of Event Location Mode
DEC-19-2008 10:03 Empty container returned to carrier at destination
New York, NY, USA Truck

If you want to check the location yourself, you can go to the NYK link, but then you must input the container number (prefix - that's the letters, and number, no spaces).

It says it's in New York, but I suspect it really in a container yard somewhere in New Jersey.

I guess it probably won't be picked up for a load until after Jan. 1.

By the way, the BBC tracking site shows that it is still loaded with consumer goods.
I thought that site was suppose to be real time, but I guess not.

The BBC Box arrived New Jersey Dec. 9

The BBC Box has arrived in Jersey City, NJ.

NYKU8210506 arrived Jersey City, NJ on December 09, 2008

I don't know if this is where it will be removed from the flat car, but I presume so.

I was wrong about when the container would arrive in New Jersey, and at what destination.

My guess was it wouldn't arrive until Dec. 12th or later. The actual transit was much faster - 5 days. Pretty good considering all the stops.



For non-Americans (or, probably more so, we Americans) who want to figure out the route, here are the state codes
CA - California
AZ - Arizona
NM - New Mexico
TX - Texas
KS - Kansas
IL - Illinois
PA - Pennsylvania
NJ - New Jersey


Status As Of Event Location Mode
DEC-09-2008 12:13 Arrived at destination rail terminal Jersey City, NJ, USA Rail


Moves to Date Event Location Mode
DEC-09-2008 05:20 Rail departure Harrisburg, PA, USA Rail
DEC-08-2008 21:20 Rail departure Pittsburgh, PA, USA Rail
DEC-08-2008 01:30 Rail departure Chicago, IL, USA Rail
DEC-08-2008 00:37 Rail departure Chicago, IL, USA Rail
DEC-07-2008 08:00 Rail departure Kansas City, KS, USA Rail
DEC-06-2008 23:38 Rail departure Wellington, KS, USA Rail
DEC-06-2008 17:30 Rail departure Amarillo, TX, USA Rail
DEC-06-2008 14:10 Rail departure Clovis, NM, USA Rail
DEC-06-2008 07:56 Rail departure Belen, NM, USA Rail
DEC-05-2008 19:01 Rail departure Winslow, AZ, USA Rail
DEC-05-2008 08:05 Rail departure Needles, CA, USA Rail
DEC-05-2008 03:29 Rail departure Barstow, CA, USA Rail
DEC-04-2008 22:48 Departed from origin rail terminal Los Angeles, CA, USA Rail

This is from the NYK tracking site, but the site has been modified and all the info is way down at the bottom (I had to look 3 times to find it).

The Box changed trains in Wellington, Kansas, which is only 20 miles from where I live. But it passed through close to midnight, so I wouldn't have seen it, even if I had been in the area.


According to the BBC site as of Dec. 9, The Box is still in California. Trust me, it's not.

The BBC Box - on the rail to New Jersey

The NYK tracking site confirms the BBC box unloaded in Los Angeles at

00:27 Dec. 04

Container NYKU8210506 Container Size/Type 40'/DRY

Status As Of Event Location Mode
DEC-04-2008 00:27 Discharged from vessel at last port of discharge Los Angeles, CA, USA NYK Starlight/065

I tried to update the info to see if the container was on the rail, but the web-site doesn't connect. It's possible that NYK has now blocked access to this site.)

updated Dec. 7, 2008, 10:17 AM
The site is now up. This shows all the rail moves so far. Container is in New Mexico as of Dec. 6, 2008.

Container NYKU8210506 Container Size/Type 40'/DRY

Status As Of Event Location Mode
DEC-06-2008 07:56 Rail departure Belen, NM, USA Rail

Moves to Date Event Location Mode
DEC-05-2008 19:01 Rail departure Winslow, AZ, USA Rail
DEC-05-2008 08:05 Rail departure Needles, CA, USA Rail
DEC-05-2008 03:29 Rail departure Barstow, CA, USA Rail
DEC-04-2008 22:48 Departed from origin rail terminal Los Angeles, CA, USA Rail
DEC-04-2008 17:48 Rail loaded at origin rail terminal Los Angeles, CA, USA Rail
DEC-04-2008 12:31 Arrived at origin rail terminal Los Angeles, CA, USA Truck
DEC-04-2008 11:51 Departed from last port of discharge Los Angeles, CA, USA Truck

According to the BBC The Box is on it's way to New Jersey

PROJECT UPDATE
The Box has left Los Angeles by rail, bound for New Jersey via Chicago
The Box arrived in Los Angeles with a cargo of consumer goods including tape measures and fashion accessorieson Wednesday

Assuming the container loaded on the rail Dec. 5 or 6, I guess it should be in New Jersey somewhere between Dec. 12 and 16. It will most likely go to Chicago on BNSF (Burlington Northern Santa Fe), or Union Pacific, and then from Chicago to New Jersey on either CSX or Norfolk Southern.

The BBC now once again says the container is both tape measure and fashion accessories.

My hunch is this is what is called a "consolidated" container - meaning the contents are for more than 1 customer, and a freight forwarder combined the shipments into 1 container.

This container will probably go into a container yard (called a CY, for Container Yard), in South Kearny, New Jersey (really the armpit of New Jersey). I think The Sopranos filmed one of the "hit" scenes close to this CY.

Oh, by the way, a CY is where they take the containers off the trains and either put them on wheels (chassis), or just stack them on the ground until the trucker comes in to pick it up.

There is also something called a Container Freight Station (CFS) where the contents of containers are loaded or unloaded (or stuffed, or unstuffed, which it is sometimes called, to be more specific).