New empty container ruling raises liability issues for truckers

Durban container truckers have objected to shipping lines’ demand for supposedly empty import containers to be delivered direct to Transnet Port Terminals (TPT) rather than the previous practice of dropping them off at the lines’ nominated empty depots. The truckers saw various problems arising from this new procedure – including possible delays, extra costs, liability and security issues. Liability and security aspects are key. Under the previous system, the lines’ empty depots checked the containers were empty and clean, and had the export empties returned to the Durban container terminal (DCT) or Pier 1 terminal in a sealed condition. But, by contract law, and SA Revenue Service (Sars) regulations applied by customs, the liability for the containers being empty – and not being used for noncompliant exports or more serious smuggling activity – will now be switched to the truckers, and their principals, the importers. This, according to Kevin Martin, chairman of the Durban harbour carriers’ section of the SA Association of Freight Forwarders (Saaff), created a major problem. The following clause, he told FTW, is on the standard bill of lading (BoL): “If containers supplied by or on behalf of the carrier are unpacked by or for the merchant, the merchant is responsible for returning the empty containers with interiors clean, odour free and in the same condition as received, to the point or place designated by the carrier, within the prescribed period. Should a container not be returned in the condition required and/or within the time prescribed in the tariff, the merchant shall be liable for any detention, loss or expense incurred as a result thereof.” And, Martin added, the merchant is defined as “including the shipper, holder, consignee, receiver of the goods, and person owning or entitled to the possession of the goods or of this bill of lading and anyone acting on behalf of such person, or any principal of such person”. These are pretty standard conditions, he said, “and are not sinister in content”, but bring two very important issues into being. “The third party, or agent of the merchant (importer), be it his transporter, warehouse or clearing and forwarding (C&F) agent, is seen as the principal in all transactions – and their actions or inactions, as the case may be, are seen to be the actions of the principal, for which the principal could be held liable by the line. “Moreover, nowhere is it stated that a seal has to be placed on the empty container by the merchant or his third parties.” These conditions were no worry under the previous procedure, but they raise problems now. “In the past the empty container had been destined for a local depot so a seal was not required,” said Martin. ‘But now, these containers are destined for international destinations – and a completely new set of liabilities could be imposed on the merchant/importer.” To avoid this unwanted liability, he added, “it is of the utmost importance that neither the merchant nor his agents seal the empty container.” These concerns regarding security and importer liability risk were put before the lines - in this case, executives of both Safmarine and Maersk Line – and these lines have agreed to address the problems. “They have undertaken to appoint their own third parties to verify that the containers are empty, attach the seal, and fill in all relevant documentation required for acceptance into terminal,” Martin said. The lines also told the truckers’ body that both customs and the border police were happy with the plan to run empty containers directly back to terminals after discharging the import cargoes. “I see no reason to doubt their word on this matter,” said Martin. But, to achieve clarity on this issue in writing, Saaff is currently discussing it with these two authorities. And, although the lines have also agreed not to pressure truckers to comply with the new procedure, and will allow a local depot turn-in, Martin suggests that container carriers should use this local turn-in option “until they are happy that the third parties have been appointed and that the system is working”. And he also added that it was worth truckers examining the impact on their vehicle turn-around times and cost impact, to see if it is viable for them. “I believe that any system that can reduce costs within a logistic chain – in this case for the lines – is worthwhile,” he said. “But extra cost to transport is of concern and will have to be examined and addressed.”