Containers: “heavies over lights” a thing of the past?

Container port

On 1 July 2016, the amendments to Chapter VI Regulation 2 of the Safety of Life at Sea Convention (“SOLAS”) will become effective. From that date, it will be: (i) mandatory for a shipper of a packed container to verify and provide the container’s verified gross mass (“VGM”); and (ii) a violation of SOLAS for a packed container to be loaded onto a vessel, if the ship operator and marine terminal do not have the container’s VGM.

What is a container’s VGM?

A container’s VGM is the mass of an empty container (the tare mass) and all packages and cargo items, including dunnage and packing/securing materials, packed into that container. Under the amendments to SOLAS, there are two permissible methods for calculating this:

Method 1: weighing the packed container using calibrated and certified weighing equipment; and

Method 2: weighing all packages and the cargo items, including pallets, dunnage and packing/securing materials, which are to be packed into the container and adding the tare mass  using a certified method that has been approved by the competent authority of the state in which packing of the container is completed (for example, in the United Kingdom, approval will need to be obtained from the Maritime & Coastguard Agency (“MCA”)).

Who is responsible for verifying a container’s VGM and when do they need to provide this information?

It is the shipper’s responsibility to obtain the VGM of a packed container. The shipper for these purposes is defined as being the person or legal entity named on the ocean carrier’s bill of lading or sea waybill or equivalent multimodal transport document and/or in whose name (or on whose behalf) a contract of carriage has been concluded with a shipping company. So, for example, if a freight forwarder/non-vessel-owning contractual carrier is co-loading the cargo shipments of other freight forwarders, it will be that freight forwarder (being named on the ocean carrier’s bill of lading) who will be responsible for the accurate cargo weight verification of all the cargo and all packaging/securing materials from all the co-loading forwarders using the container.

Once the VGM has been ascertained, the shipper is required to communicate this to the master or the master’s representative and the terminal representative in a shipping document which: (i) has been signed by a person duly authorised by the shipper; and (ii) clearly highlights that the stated gross mass provided constitutes the VGM. While a shipping document can be a separate communication, it can equally be part of the shipping instructions. It, however, has to be submitted sufficiently in advance, as required by the master or his representative, so as to enable its use in the preparation of the vessel’s stowage plan.

It should, however, be noted that while the provision of a VGM is a prerequisite to loading onto a vessel to which SOLAS applies, it does not constitute an entitlement for loading. The master of the vessel retains ultimate discretion in deciding whether to accept a package container for loading onto his vessel.

Where a container is presented without a VGM, that container cannot be loaded, unless the master or his representative and the terminal representative manage to obtain the VGM on behalf of the shipper.

Comment

Although the amendments to SOLAS are to be welcomed, much uncertainty remains as to their implementation. While the MCA has produced a guidance note providing, amongst other things, details on how accreditation under Method 2 might be obtained, comments made by the US Coast Guard would seem to suggest that they consider themselves to have no authority to check that shippers are providing VGMs. In addition, decisions as to how to implement the mandatory regulations are to be taken at local state level. This has generated significant controversy as it will almost certainly result in different standards or procedures being adopted in different jurisdictions. This is already being seen in relation to issues such as the ‘margin for error’ that is allowed when calculating the VGM.

Whilst it is not anticipated that the container trade will grind to a halt on 1 July 2016, there is likely to be disruption and a period of adjustment to be endured by the liner industry. Carriers should take pro-active steps to prepare themselves for 1 July 2016 and may wish to consider some of the following:

•  ascertaining which is the Competent Authority in the jurisdictions in which they operate and how the amendments will be implemented by that Competent Authority;

•  putting in place procedures to ensure that all containers included in the stow plan/loaded have VGMs;

•  putting in place procedures to deal with containers which arrive without a VGM;

•  amending any contracts in place with terminals so as to enable VGMs to be obtained for containers that arrive without a VGM; considering whether the present “cut off dates” by which containers are received are sufficient in light of the amendments to SOLAS;

•  putting in place systems to allow the efficient transfer of VGMs from shippers;

•  reviewing any contractual arrangements with shippers to expressly deal with the allocation of costs and losses that arise where a container does not have a VGM and shipment is delayed; and

•  whether the manner by which maximum and tare weights shown on those containers comply with the ISO Standard for Container Marking and Identification.

Article authors: Rory Macfarlane, Antonia Jackson

 

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