Shipping companies' bunker surcharge on freight raises hackles

Shipping companies and airlines are living in two different worlds. While airlines including Cathay Pacific have agreed to pay large fines over fuel surcharge collaboration, the same rigorous oversight it seems is not being applied to the shipping industry.

The Hong Kong Shippers' Council, which represents exporters, yesterday said eight shipping lines were acting together to levy a so-called emergency bunker surcharge on cargo. The council said yesterday that Orient Overseas Container Line, Evergreen Marine and six other Asian shipping companies would collect a surcharge of HK$440 per teu (20-foot equivalent units) or HK$880 per 40-foot equivalent units from companies shipping goods from Taiwan to Hong Kong and southern China. The eight lines provide almost all shipping services in the region.

The annual volume of shipments in the Taiwan to Hong Kong and southern China region is estimated to be 1 million teu. translating into HK$440 million in additional costs for exporters, according to the council.

'Bunker and fuel surcharges should be collected from the party that pays for the freight,' said council chairman Willy Lin yesterday. However, as about 90 per cent of freight charges are pre-paid in Taiwan, the shipping lines specified the new surcharge would be collected from consignees in Hong Kong and south China. Mr Lin said this had violated international shipping practices and was unacceptable.

The council has urged its members to reject the charge and called for government intervention to avoid potential chaos in the trade.