On July 1, 2016, a new regulation from SOLAS (Safety of Life at Sea convention of the International Maritime Organization or IMO) takes effect requiring shippers whose name appears on the bill of lading to verify the gross mass of a container carrying cargo when tendering the container to the ocean carriers and terminals. Many questions still remain unanswered, and there is widespread frustration about lack of information including from key service provides including container lines and marine terminals. Rules and legal enforcement are likely to vary potentially widely among countries, ocean carriers and marine terminals, making this rule potentially a big headache for shippers to comply with. But a few things are already clear: On July 1 the rule becomes not just international law under the IMO but national law within the 162 countries that are signatories to the SOLAS convention. The legally responsible party for providing a verified gross mass (VGM) signed either electronically or on paper is the shipper. Carriers will not load containers anywhere in the world unaccompanied by a VGM, because doing so would leave their ships out of compliance with flag state and insurance rules. Hapag-Lloyd, the world's sixth-ranked carrier in capacity deployed, according to Alphaliner, said, "A packed container, for which a verified gross mass has not been obtained, will not be loaded on the vessel." Crowley said it "stands firmly behind the rationale for this regulation." Approximately 300,000 container weights will need to be certified each day globally, and roughly half of all booking requests and shipping instruction submissions each day are non-digital, in other words, in paper form, according to Inttra. Marine terminals may in some cases offer weighing services if it can be done without disrupting regular terminal operations, but this will not be in all cases, as some terminals, such as Maher Terminals at New York-New Jersey, in December said it does not have the capacity to offer weighing services for non-compliant containers and won't in-gate any container without the VGM already received via EDI. Overall, as the first quarter of 2016 came to a close, shippers worlwide were very busy determining how they will be in compliance, but many questions remain particularly around governments' plans for penalties for non-compliance, or allowable tolerances from stated VGMs.." A country-by-country breakdown of published guidelines from the World Shipping Council shows that only about two dozen countries had published guidance as of early June. Part of the remaining challenges stems from the desire by all parties to avoid incremental costs which has resulted in limited progress in the key private-sector issues that the SOLAS rule leaves up to the commercial parties to work out amongst themselves.
The following questions and answers are drawn from a variety of sources, including JOC.com reporting, published commentaries, press releases, statements by speakers at JOC events, presentations, government and company documents, and an official Q&A published jointly in December, 2015 by the World Shipping Council, TT Club, Global Shippers Forum and International Cargo Handling Coordination Association. Additional information can be found on the World Shipping Council website here, as well as the website of the Ocean Carrier Equipment Management Association or OCEMA, here. The World Shipping Council recently published a country-by-country breakdown of official published regulations. Extensive links to external resources are provided throughout the Q&A below. The actual SOLAS rule is here. A page containing the full JOC coverage of the issue is here.
This FAQ has been updated as of June 28, 2016 and we are continuing to update it as more information becomes available.
- Maersk Line has joined OCEMA in its acceptance of VGMs generated by existing, in-terminal weighing processes at U.S. ports. (June 28)
- India has provided an extension for shippers to comply with its national guidance on SOLAS compliance. (June 28)
- A Hong Kong shipping association said freight forwarder fees for SOLAS are unjustified. (June 28)
- All the terminals at the second-busiest U.S. gateway at the Port of New York and New Jersey will provided weighing services, but fees may apply. (June 27)
- The Federal Maritime Commission gave approval to a discussion group between ports and container lines that will help establish a system that will use pre-existing weighing processes to satisfay the SOLAS rule. (June 27)
- A group of marine terminal operators is unhappy with the idea that they should be responsible for creating VGM documentation. (June 23)
- A non-profit has established a global database of container tare weights to facilitate the process of VGM generation. (June 22)
- Container lines are backing the use of existing processes in the United States to meet the SOLAS VGM rule. (June 20)
- A number of non-vessel-operating common carriers have released their SOLAS guidelines. (June 20)
- Damco will offer container weighing services worldwide. (June 14)
- The National Customs Brokers & Forwarders Association of America has compiled a list of container terminal and container line guidance on SOLAS (June 10).
- An International Maritime Organization call for countries to exercise regulatory leniency has added to shipper confusion and is the latest harbinger that disruption will hit many of the world’s ports in three weeks. (June 9)
- Europe’s top terminal operators and equipment manufacturers are accelerating moves to help shippers comply with the SOLAS rule. (June 9)
- Exporters using the Port of New York and New Jersey are getting a better idea of terminals' SOLAS polices after a facility issued guidance. (June 9)
- United Arab Shipping Company will charge shippers that fail to provide a VGM a steep charge based on the freight rate, and bunker and currency adjustments. (June 8)
- Seattle's largest container terminal said it will keep weighing containers to meet federal rules, but it won't provide them to shippers to they can fulfill the VGM requirement. (June 8)
- Orient Overseas Container Line told customers that they'll offer container weighing prices at $300 per unit. (June 8)
- Brazilian container terminals are finalizing their pricing for the transmission of VGMs. (June 8)
- More Canadian terminals are disclosing their SOLAS policies, but others still have yet to do so. (June 8)
- A trucking company will offer container weighing service for $10 a unit for shippers using the Port of New York-New Jersey. (June 7)
- Shipping stakeholders expect disruptions after the rule takes effect July 1, but argue the industry will muddle through. (June 6)
- Forwarders are being warned not to take the IMO circular regarding a three-month grace period as an excuse for noncompliance. (June 6)
- Too few Russian exporters are prepared for SOLAS container weight rule and the government might not be able to process certifications for one method of meeting the rule in time. (June 4)
- Time is running out for the U.S. maritime regulators to give the go-ahead for what could be a major breakthrough for U.S. exporters, carriers and marine terminals. (June 3)
- Container terminals at the ports of Long Beach, Los Angeles and Oakland are positioning themselves to offer container weighing services. (June 2)
- Kuehne + Nagle detailed surcharges their customers will have to pay for electronic and non-electronic transmission of VGM declarations. (June 2)
- Global terminal operator PSA International will offer container weighing services at most of its facilties. (June 2)
-CMA CGM became the first carrier to unveil a platform allowing shippers to directly submit their VGM electronically. (June 1)
- Australian ports are worried that the country is going to be too lenient about SOLAS in the early months after taking direction from the IMO. (May 31)
- The second-largest Russian container terminal will offer container weighing services. (May 30)
- Shippers are encouraged by IMO's statement urging signatory countries to take a lenient hand to SOLAS enforcement during the first three months. (May 27)
- The largest U.K. port detailed how much it will charge shippers for container weighing service. (May 26)
- Modern Terminals said its Hong Kong facility and two of its Chinese termianls will provide container weighing assistance to shippers. (May 26)
-The International Maritime Organization encouraged the 162 signatory countries of the SOLAS convention to exercise "practical and pragmatic" policies. (May 23)
- A new survey shows that shippers and forwarders are still confused on how to meet the SOLAS rule. (May 23)
- Insuring cargo in the short term will likely get more expensive due to the new SOLAS rule. (May 23)
- OOCL warned customers that fail to comply with the rule that they'll be subject to penalties, spot checks and shipment delays. (May 23)
- APM Terminals bemoaned the lack of clarity on SOLAS in the industry. (May 23)
- A Pearl River Delta terminal has become the first in the region to announce it will offer container weighing servies (May 23)
- U.S Gulf ports are grappling with how to implement SOLAS rule at their marine termianls (May 21)
- The Port of Charleston pulled back on plans to charge exporters to weigh their containers, saying it will provide the service for free. (May 19)
-A proposal by six East and Gulf Coast operating ports and 19 container lines to craft a common SOLAS strategy could be a breakthrough for U.S. exporters worried about meeting new rule. (May 19)
- The U.S. Congress has asked the U.S. Federal Maritime Commission to determine if container lines and marine terminals' approaches to SOLAS are consistent with U.S. maritime law. (May 19)
- A cottage industry has sprung up aimed at helping shippers meeting the SOLAS rule. (May 18)
- Although scales are available at Port Everglades, it's up to each of the port's 11 terminals to decide whether to provide weighing services. (May 17)
-A group of U.S. exporters said "no thanks" to container lines' attempt to mollify their concerns over the liablity of tare weight of containers. (May 17)
- Latin American and Caribbean countries take different approaches to SOLAS, adding to shipper confusion. (May 17)
- India finalizes SOLAS guidelines, detailing error thresholds and hinting to penalties for offenders. (May 16)
- Questions swirl about the strength and scale of the U.S. enforcement of the SOLAS container rule. (May 16)
- APM Terminals added its facility at Rotterdam to the list of terminals that will offer container weighing services. (May 16)
- North Carolina's Port of Wilmington said it won't charge exporters for existing container weighing services, which can be used to gain the verified gross mass declaration. (May 13)
- Hutchison said the majority of its terminals in its global network will offer container weighing services. (May 13)
- Los Angeles and Long Beach marine terminals are reluctantly considering whether they should offer container weighing services. (May 11)
- A group of 19 container lines said they would soon state in written legal terms that U.S. exporters won't be held legally liable for inaccuracies in the container tare weight when generating a verified gross mass. (May 11)
- India gave shippers some more breathing room in terms of what level of variation it will allow for container weights. (May 11)
- APM Terminals will provide container weighing services at 29 locations across its global network. (May 11)
- The first terminal at the Port of New York and New Jersey to detail how it will respond to the rule said it will provide the service to shippers for $69.10 per unit. (May 10)
- Israel revealed that it will be double-checking the VGM of containers moving to ports via rail or road. (May 10)
- The Port of Virginia changed course on its container weighing policy, saying it will provide weights to exporters. (May 10)
- U.S. exporters and carriers are in a high-stakes game of chicken over the newly-blessed alternative method allowing shippers to weigh goods and then have container lines add the tare weight of the box. (May 6)
- DP World said it will charge shippers 65 dirhams (approximately $18) to weigh containers at its Jebel Ali terminal. (May 5)
- The Georgia Ports Authority said it will weigh containers at no cost to shippers. The authority emphasized it will not verify the weights, but it will provide them to the shippers so they can create the VGM. (May 5)
The U.K. is increasing its scrutiny of exporters that will calculate the contents and packaging of a container before adding that sum to the tare weight to gain the VGM. (May 5)
- The majority of Class I railroads have said they will continue to load containers on trains whether or not they are accompanied by certified weights. Concern, however, lingers over what will happen to containers without a VGM if they are off-loaded from the rail ramp but refused by the terminal. (May 3)
- The U.S. Coast Guard gave its blessing to two alternative methods for compliance: where the terminal weighs the container on behalf of the shipper, and where the shipper provides the weight of the cargo only and the carrier verifies the tare weight of the container. The latter approach may still be rejected by carriers such as APL. (April 29)
- Japan has finalized its regulation and penalties to implement the rule, with failure to provide or falsifying a VGM carrying a penalty up to $1,870. (April 29)
- China issued its regulations, saying it will conduct random inspections of containers and that vessels cannot load containers without the VGM. (April 29)
- The Port of Charleston is taking steps to weigh containers and generate a VGM on behalf of exporters, a sharply different approach from several other U.S. terminals, like those at Houston, that say they will reject containers that arrive without a VGM. (April 28)
- The 13 terminals at Los Angeles-Long Beach have collectively said they will not offer weighing services. See story here and follow up here where U.S. exporters say the move by the terminals still leaves many questions unanswered. Also see 9) below (April 4)
- Shippers can expect to pay to comply with SOLAS. The financial services company Cowen & Co. says it sees shippers paying incremental sums to comply with the SOLAS rule. See 7) and 26) below. (April 1, April 5)
- One shipper, VOXX International, a consumer electronics company, is having its China forwarder collect and weigh goods from 150 suppliers and add the tare weight to create the VGM, rather than relying on its suppliers to supply weights. See 7) below. (April 1)
- Kuehne & Nagel is telling its full container load customers, the vast majority of the ocean cargo it handles, that it will treat them as a "shipper" required to provide a valid VGM to it as the "carrier". See 8) below (March 31)
- MSC will use the Inttra "eVGM" tool to assist customers in electronically transmitting their VGMs to the carrier. Early indications are that the service will comes at a cost for shippers, but costs haven't been defined. See 6) below. (March 30)
- OCEMA, the U.S. ocean carrier equipment group, is telling U.S. exporters they won't be held responsible for the accuracy of the container tare weight. This statement was contained within a document released on March 21 of best practices for shippers, carriers and terminal operators. See 1) and 6) below (March 21)
- The U.S. Coast Guard is telling shippers that they need to comply with the "spirit" though not necessarily the "letter" of the new SOLAS rule given that it has no authority to enforce the rule on U.S. shippers. See 1) below (Feb. 26)
- UK Terminals at Southampton and London Gateway, both operated by DP World, as well as Felixstowe, will offer a container weighing service to ensure UK shippers can comply with the new SOLAS VGM. See 10) below (Feb. 11)
- OCEMA, the ocean carrier equipment group in the U.S., is stepping in to work out details for how U.S. exports will comply with the rule without disrupting trade, see 6) below (Feb. 8)
- Multinational shippers are making extensive process and operational changes to their supply chains in order to ensure they are in compliance as of July 1, see 15) below (Feb. 5)
- Containerization founder Malcom McLean "strongly believed that (overweight containers) were dangerous on the road and in the port," his former lawyer said. See 19) below. (Feb. 3)
- A growing question from shippers is what degree of variance from submitted VGMs that coast guard agencies around the world will allow before issuing a violation. See 22) below (Feb. 2)
- An effort is under way to create a new electronic shipping document to convey the VGM from the shipper to the carrier. See 6) below (Feb. 2)
- Terminals at the large JNPT complex at Mumbai, anticipating that many containers will arrive without the VGM, are preparing to conduct weighing to produce the VGM, using yard cranes within the terminal. See 10) below (Feb. 3)
- One NVOCC that loads less than containerload cargo will make its end-customers fill out a weight form but says it will weigh cargo itself to ensure its own declared weight is accurate. See 8) below (Jan. 28)
1) At a basic level, what is the new requirement put on shippers?
Under the new SOLAS VGM (verified gross mass) requirement, the shipper named on the ocean bill of lading is the party responsible for providing the container carrier and the terminal operator with the verified gross mass of a packed container. The carrier and the terminal operator must not load a packed container aboard a ship unless they have the verified gross mass for that container. The “shipper” according to MSC 1 / Circ. 1475 (the IMO’s guidance on VGM), is “a legal entity or person named on the bill of lading or sea waybill or equivalent multimodal transport document as shipper, and/or who (or in whose name or on whose behalf) a contract of carriage has been concluded with a shipping company.” This shipper responsibility doesn’t go away if a shipper uses a forwarder to pack and weigh a container, forward it to the port and even make the booking with the carrier. If the forwarder is acting purely on the instructions of the shipper to undertake that work on his behalf, and the shipper’s name is still what appears on the bill of lading, it’s the shipper that is responsible for verifying the gross mass weight. The shipper will have to ensure that it’s satisfied with the integrity of the forwarders’ weighing process if it’s relying on the forwarder’s measurement. However, at least in the U.S. since the Coast Guard, which enforces SOLAS in the U.S., has begun to enter the dialogue much of what shippers will actually have to do to comply has been called into question. The Coast Guard is saying that shippers need to comply with the "spirit" of the new role, in other words state an accurate weight of their cargo to the carrier, but as the agency has no authority to actually enforce weighing requirements on shippers it is saying that what shippers must actually do to comply is a matter of commercial dialogue between shippers and their carriers. For example, the Agriculture Transportation Coalition said on Feb. 26, 2016 that exporters do not need to comply with the letter of the SOLAS rule, citing statements from the U.S. Coast Guard. According to the AgTC, "Admiral Paul Thomas of the United States Coast Guard later reiterated that the current process for exporter submission of cargo description and weight is compliant with SOLAS and thus there is no need for delay or change to the current cargo weight information flow from shipper to carrier. The admiral stated that VGM requirements for the ship will be satisfied if shippers provide container gross cargo weights, and the carriers provide tare weights for their equipment to the master." The statements from the Coast Guard indicate that any requirements will be only within the realm of commercial interactions between shippers and carriers, thus it is expected that carriers will adjust their requirements at least on U.S. exporters to ensure their rules are no more onerous than any other carrier which would thus leave them uncompetitive. The Ocean Carrier Equipment Management Association, or OCEMA, on March 21 told U.S. exporters as part of a larger set of best practices for shippers, carriers and terminals that the exporters won't be held legally responsible for the tare weight of the containers. This is meant to address a concern by exporters that since an individual person is required to sign the VGM on behalf of the exporter, they are being asked to verify the weight of an object - i.e. the container itself - that the exporter neither owns nor controls. According to OCEMA director Jeffrey Lawrence as told to JOC.com, "If a shipper accurately uses the tare weight shown on the container door in calculating the VGM, the carrier position on the law is that the shipper and verifying person are not liable for inaccuracies in actual container tare weight versus tare weight printed on the container door. After stating that there were multiple ways that the industry can meet the rule, the Coast Guards in late April gave its blessing to two alternative approaches. Shippers could send the weight of their goods and the carriers could add the tare weight of the container to establish the VGM, the agency said. The Coast Guard also said it was acceptable to use weights measured at ports to meet the Occupational Safety and Health Administration rule — first proposed by the South Carolina Ports Authority — to tabulate the VGM. In declaring an equivalency, allows the VGM to be determined via "any equipment currently being used to comply with Federal or State Law, including the Intermodal Safe Container Transport Act, and the container requirement" of existing Occupational Safety and Health Administration regulations.
2) How will the rule be enforced, and what are the risks for shippers?
Certain basic facts are known. The rule will be officially enforced by the maritime authorities of individual nations, whose implementing regulations will vary, potentially widely depending on country and region.The IMO in late May urged signatory countries to provide regulatory leniency in the first three moths of the rule so as not to impede trade and help industry deal with teething problems. However, shippers are still required to provide the VGM during this grace period. As a practical matter the real-world “enforcement” that will affect shippers most directly seems most likely to be carried out directly by the container lines and terminal operators, who are both required not to load a container without the certified VGM document accompanying it and to use the VGM for stowage planning. Enforcement agencies may implement measures to satisfy themselves that compliance is achieved, which could include documentation checks, auditing or random weight checks. The carriers and terminals are expected to be disciplined in their unwillingness to accept containers tendered to them without the required VGM documentation in order to avoid costs and penalties such as delayed sailings, to avoid costs for the storage and handling of affected containers which could congest terminals and which might be difficult to recover from the shipper, and especially to avoid liability in the event of a casualty whether at the dock or at sea. Hapag-Lloyd in a brochure on the issue said "A packed container, for which a verified gross mass has not been obtained, will not be loaded on the vessel." Thus, “the risk is your container won’t get shipped. It would be turned away from the terminal,” said Global Shippers Forum secretary general Chris Welsh told JOC.com in an interview in October.
Some, though not all, terminal operators are considering introducing weighing services as a revenue stream and to assist non-compliant containers to be loaded, as this paper from the Port Equipment Management Association suggests. Some terminals like Maher at New York-New Jersey are saying they will explictly not offer weighing services on their facilities and will turn away non-compliant containers at the gate. But not all terminals are expected to adapt such a stringent "no VGM, no in-gate" position since carriers would likely see this as disrupting the flow of their customers' cargo. As a bottom line matter no container lacking a VGM will be included on the "terminal load list" which is the list of all containers to be loaded provided to the terminal by the ocean carrier prior to the commencement of vessel loading. At the same time, some are speculating that since many shippers are telling carriers that they won't be ready for implementation of the rule on July 1 (see report on Inttra shipper survey released on Dec. 1) there may need to be some kind of an initial soft launch, similar to how U.S. container security measures were implemented, following by a hard launch when penalties would take effect. Or if confusion continues to grow some may seek a delay in implementation. But that is mere speculation at this point. In fact, an IMO source said in late January that no efforts were currently under way to delay the ruling. The organization in late May urged signatory countries to provide regulatory leniency in the first three months of the rule. Some goverments like the U.K. have issed guidelines for example for certifying those who will be carrying out Method 2 weighing procedures (that is, weighing the contents of the container and adding that to the tare weight, or unloaded weight, of the container). In its latest guidelines, the U.K. is requiring shippers to register and pay a fee if they plan to weigh the contents and packaging of a container before adding that sum to the tare weight to gain the verified gross mass.
3) When does the new regulation take effect?
The new regulation, called Verified Gross Mass, becomes legally binding on July 1, 2016, and will apply to all containers accepted for transportation (gate-in to the terminal or off-rail into the terminal) on or after that date, from any port in the world. Containers accepted for transport prior to July 1 that are already in transit once the new rule is imposed will not be affected. IMO member states have the option to delay implementation of the rule for a one year period if they notify the IMO prior to July 1, 2016, but as of Feb. 11, 2016 no government was known to have taken that step. A member state can give notice to the IMO that it "exempts itself from giving effect to that amendment for a period not longer than one year from the date of entry into force," according to SOLAS Article VIII (b) (vii) (2).
4) Will legislation be required by each country to make the convention law at their ports?
No. The rule is law in each of the 162 countries that are signatories to SOLAS. The reason is that SOLAS has international legal status so there need not be any further implementing legislation for states that are party to it. There has been no precedent for non-implementation or delay in the implementation of a SOLAS regulation, so there is no reason to expect any delay in implementation beyond July 1, 2016, although due to the many complexities that are arising and described at various points within this Q&A, some are beginning to say that a delay or phased in approach may be needed. As a United Nations agency, the IMO leaves it to each of the individual countries to implement the ruling, which means that the exact system of penalties and procedures is left to each government and managed by the agency representing IMO in the respective country, for example the Coast Guard in the U.S., or the Maritime & Coastguard Agency in the U.K. The exact timing of regulations being promulgated and enforced will inevitably vary country by country. That said, it is understood that several countries’ agencies are currently investigating how to prevent the loading of container without the VGM submitted. However the potential for lack of uniformity in the implementing regulations among countries has created alarm.
5) What is meant by the requirement for a “signature” on the VGM document?
What the SOLAS rule requires is that the shipper communicates the verified gross mass in a “shipping document.” It must be signed by a person duly authorized by the shipper, with a first and last name, not just a company name. The signature may be an electronic signature or may be replaced by the name in capitals of the person authorized to sign it. The VGM and signature can be part of the shipping instructions communicated via electronic data interchange (EDI), or be contained within a separate communication including a hard copy document. In either case, the document should clearly highlight that the gross mass provided is the “verified gross mass.” There is no requirement that a so-called “weight ticket” generated by a weighbridge be presented, but national implementing regulations may require that shippers using Method 1 (weighing of the cargo and container as one) produce weight tickets or other documentation upon request. One NVOCC that handles less-than-containerload cargo has created a document that it is providing its customers to be filled out, but given that it's the shipper on the carrier bill of lading says it will also be weighing cargo that it consolidates along with other customers' cargo, discussed here.
6) How will the signature and documentation be handed off from one party to the next in the supply chain?
This is an area where regulations won’t apply and it will be a matter of coordination among parties, with processes very much still to be worked out as of early 2016. On March 30th MSC announced it would use the Inttra "eVGM" tool to assist its customers in electronically transmitting the VGM to the carrier, with the required information and signature. OCEMA, the U.S. carrier equipment management association, on March 21 published a set of best practices that included guidance for shippers on the several ways the VGM can be conveyed to the ocean carrier, including EDI, carrier websites and neutral portals such as Inttra and Cargo Smart. The pressure is on given that the clock towards July 1 is ticking ever louder, the large percentage of containers that are shipped using non-electronic documents including hard copies and faxes. According to a Q&A published in December by the World Shipping Council, the Global Shippers Forum, TT Club and ICHCA International, “There are inevitable process challenges to ensure effective coordination between the shipper and hauler to achieve effective documentary handoff (whether electronic or paper) to avoid in-gate delays. Such processes should be discussed between the commercial parties, including the maritime carrier and the terminal operator.” In reality, electronic communication will need to be core to how the signature is passed from party to party, though use of electronic data interchange or other electronic platforms is far from universal within the industry.
Maher Terminals at the Port of New Jersey said it will it not accept containers without an electronic signature sent via EDI. The ocean carrier portal Inttra which facilitates electronic documenation has been active in the issue, indicating the importance of EDI and other electronic systems in implementing the rule. As of early 2016 there was an effort under way to create a new, standardized electronic shipping document solely for the purpose of conveying the VGM along the supply chain. According to this FAQ published by Hamburg Sud, it will accept a VGM whether in the shipping instructions, booking request, or separately for example in a declaration containing a weight certificate issued by the weighing party, but irrespective of how it is conveyed it must state that it is the VGM and be signed by the representative of the shipper. As of early February, at least in the U.S., OCEMA (the Ocean Carrier Equipment Management Association) was stepping in to work out details for how U.S. exports will comply with the rule without disrupting trade. OCEMA was the group that determined the information flow needed to comply with the 24-hour advanced manifest rule implemented in the U.S. in 2002 following 9-11.
7) When sourcing from contract manufacturers at origin countries, will retailers, consumer product firms and others rely on their manufacturers to conduct the weighing at the origin?
Most shippers use third-party logistics companies (3PLs) to pack and transport containers to ports. Therefore, it is fair to expect that contracts for contract logistics and freight forwarding services will be amended to reflect the VGM requirement. Shippers can expect 3PLs to try to assess an incremental fee to weigh containers. It is unrealistic to expect the shipper themselves to perform this work themselves in most cases since they lack resources, space and staff able to undertake the actual weighing of cargo or loaded containers. Therefore all 3PLs and freight forwarders will have to offer such services in some form, but in order to minimize supply chain disruption as the implementation date approaches in 2016, a customer should inquire early to be certain that the requirement can be met. In situations where the manufacturer loads the container, the shipper - who is the responsible party under the rule - will have to leverage vendor-compliance tools and processes to ensure that the weight the manufacturer states for the bill of lading is the real weight that will hold up in an inspection. But this opens the door to risk; according to one shipper interviewed by JOC.com in January, "what goes on the paper might not be what is in the box, and that will leave us with a serious problem. We will have to enforce the rule at all our vendors." According to some sources, China factories will be reluctant to invest in weighing equipment and overall are shrugging off the impending rule. Thus it is not surprising that VOXX International, a U.S.-based manufacturer of consumer electronics, told JOC.com it plans to use Method 2. Its longtime China forwarder will weigh all packaged products from its 150 China suppliers, and will add the container tare weight to create the VGM. VOXX decided not to ask each of 150 suppliers to provide the weight of each product shipped and its packaging, anticipating additional charges and other issues.
8) Are shippers that only tender partial loads to a forwarder or master loader responsible for providing a VGM? What about full loads tendered to forwarders?
Shippers that only tender partial loads to a forwarder are not reponsible for providing a VGM. The responsibility for providing the accurate, verified gross mass of a co-loaded container remains with the shipper named on the maritime carrier’s bill of lading, i.e. the “master” loader or freight forwarder or NVOCC. The contractual terms between the ultimate shipper and a co-loader may require the shipper to provide a weight to the master loader, or the master loader or forwarder might undertake the weighing process themselves, but either way this would be a commercial arrangement between those parties. However, the situation will be different in the case of full container loads that move under NVOs' contracts with the carriers. Kuehne & Nagel, the largest seafreight forwarder, is telling its full container load customers, who represent the vast majority of its ocean freight, that it will require them to provide a valid VGM as if it were the actual shipper on the bill of lading. It's likley that other large forwarders will adapt similar policies. The reason is that in handing FCL cargo Kuehne & Nagel and other major seafreight forwarders don't pack or otherwise handle the cargo; rather it only gets moved under their ocean carrier contracts where the freight rate for the shipper presumably is lower than what the shipper could obtain on their own. "We will be requiring a valid VGM that is in compliance with the rules," Bill Rooney, the forwarder's vice president for trade management for North America, told JOC.com on March 30th. "We will require customers to meet the requirement." For shippers using NVOs that consolidate boxes on their behalf - a business dominated by carrier-owned or former carrier-owned NVOs like APL Logistics, Yusen Logistics and Damco, those NVOs will need to undertake the weighing directly themselves in order to be in compliance. This article describes how one NVOCC that consolidates less-than-containerload cargoes is ensuring that the VGM rule gets properly implemented without impacting customers' supply chains or its own operations.
9) Is it most feasible for the weighing process to take place at the port or earlier in the supply chain?
There is a lot of debate around this issue currently. Some ports such as Felixstowe in the UK, as this article reports, and JNPT in Mumbai, as we report here, as well as London Gateway, say they will offer weighing services. Also in Brazil, plans are under way for weighing to occur at the port, as JOC.com reported here. Terminals at Los Angeles-Long Beach, the largest U.S. gateway, said on April 1 (not as a joke either) they will explicity not offer weighing services, saying they don't have the ability to and thus want shippers to obtain the VGM earlier in the supply chain. According to Inttra, in general it is unrealistic to expect weighting units to be installed at ports in even close to a necessary quantity to weigh every container prior to loading, thus in many if not most cases shipper will need to have their cargo weighed prior to arrival at the port. At some ports, even if the capital and equipment existed, there is simply not enough physical space or related infrastructure (such as roads and cranes) to accommodate weighing of containers. Maher Terminals at New York-New Jersey said in late 2015 that it does not have the capacity to perform weighing services, and we are hearing that most U.S. terminals are adapting the same or similar position (though whether carriers as the terminals' major customers will demand that containers without VGMs be accepted is still an open question in certain markets such as the U.S. Some port equipment providers, sensing a business opportunity, are advocating that terminals consider providing weighing services to help shippers comply, offering suggestions about where within their facilities containers could most feasibly be weighed. One port equipment manufacturer said in a recent presentation that weighing at the terminal gate would be difficult since some trucks arrive with two 20-foot containers, while others have noted that use of a weighbridge that weighs the full truck is an imprecise measurement since the weight of the truck and any fuel would have to be subtracted out. Weighing using the ship-to-shore gantry crane is considered too late for the weight to be used for the vessel stowage plan- a requirement that the new rule puts on container lines. Thus the suggests that terminals, if they are to get into the business of weighing containers, should do it in the stacking yard. But there there are also challenges and investment required by termials. According to the monitoring equipment provider Strainstall in a recent white paper, "With the 2016 SOLAS regulations in force, it is likely that all new container handling equipment will be designed from the outset to incorporate container VGM (verified gross mass) technology. Other than for the very few new installations currently in planning, however, SOLAS compliance will need to be achieved via the installation of retro-fit solutions onto existing assets." It is unclear how many terminals globally are planning to make this investment. APM Terminals said May 11 that it will offer container weighing at 29 of its facilities and plans to provide the service at more.
More realistically, however the most likely scenario in most cases will be for the cargo and the container to be weighed separately at origin, under Method 2, and the total weight provided as the VGM with a certified signature. However for some cargoes like scrap metal that is loose and difficult to be weighed on its own, it will be necessary to weigh the packed container on a chassis and subtract the chassis. This can potentially be performed at weighing stations at distribution center facilities or independent stations. It means adding time and cost to the contract for the beneficial cargo owner (BCO) with the trucking company and weighing station, as well as capabilities to receive details from them for submission to the carrier. The documentation submitted to the carrier has to come from the BCO or been authorized in a way that prevents fraud and accounts for liabilities. For standard and smaller items — palettes, crates, parts or smaller industrial equipment — the weighing will most likely be performed at the facilities where the packing is done, whether it is BCO owned or a freight forwarder's distribution center. The latter usually have weights for such items but again, the parties need to augment existing commercial agreements to account for labor, costs and time. In some cases it results in adding more weights to the facilities. In a dedicated distribution center, the customer may have to pay, in a multi-customer DC, the freight forwarder has to pay but will most probably pass over the cost. One service says it will show up to a facility anywhere to weigh containers and transmit the VGM to the carrier.
10) Will some terminals agree to weigh containers on behalf of shippers?
Yes, but not in all regions. In the U.S. most terminals so far have either said or indicated that they do not want to provide weighing services, given the potential to add to port congestion and the possibility that they will make the necessary investments in new or upgraded equipment but not achieve a remunerative revenue stream. Terminals at Los Angeles-Long Beach on April 1 said they would not offer weighing services. After Charleston's alternative approach received the Coast Guard's go-ahead, the ports of Savannah and Virginia also changed their stances on weighing services. Port Newark Container Terminal will also offer container weighing services and other facilities at the New York and New Jersey could follow suit. Also, the Port of Baltimore’s Ports America Chesapeake said it plans provide on-site container weighing services to shippers whose boxes arrive at the waterfront without VGM documentation.
Other terminals, such as those at Mumbai and the DP World-operated Southampton and London Gateway facilities in the UK, as well as the terminal at Felixstowe in the U.K., are setting themselves up to generate a VGM on behalf of the shipper, given the possibility that many containers will arrive unaccompanied by the VGM. According to the DP World terminal at the JNPT complex at Mumbai, "we will integrate VGM with our existing terminal operating systems, or TOS, enabing the yard cranes to capture the verified weight of the container." DP World at JNPT told JOC.com on Feb 3: "We will weigh containers using our yard equipment and shall integrate weight information with our existing Terminal Operating Systems. The captured information for Verified Gross Mass will reflect during the transaction and be further shared with concerned stakeholders. In a situation where a container vessel shows up at the terminal and the VGM is not provided by the shipper, then the terminal yard equipment will be capable of weighing containers and shall provide the VGM information upon request by the shipper and shipping lines." The possibility that many containers will show up at Mumbai with no VGM is driving the terminals' approach. "Proper weighing facilities may not be ready or available close to the port and there are chances that containers may arrive at the terminal gates without the VGM. The weighing activity is with the lifting equipment and the captured information will be relayed through our Terminal Operating System. There will be no delays at the port as we will integrate VGM infrormation with our existing TOS."
11) What will happen if a container is turned away at the terminal gate or allowed into the terminal but not allowed to be loaded?
Containers may get turned away at the gate if they lack the required VGM. Marine terminal operators, already combating congestion due to mega-vessels are concerned that accepting non-compliant containers which by law cannot be loaded risk further congesting their facilities. There are two scenarios if a container gets turned away, one if the container does not arrive at the terminal with the required VGM document and is turned away, and two if it is allowed into the terminal but is subject to a random check and the weight is determined to be different from the declared VGM weight. In the first case arrangements will have to be made to transport, store and weigh the container so a certified VGM can be presented to the carrier and terminal. This will by definition involve additional trucking and storage cost to the shipper, which is leading carriers to be particularly focused on assisting shippers to ensure that containers don't arrive at the gate without the VGM. In the second scenario, the terminal will initially sequester and store the container and will most likely charge appropriate fees, on top of any fines assessed. How each terminal will handle overweight containers is one of the murkiest issues of the container weight mandate. For example, in reference to the question just above this one, it is unclear how many terminals will equip themselves to perform weighing services for containers that arrive at the terminal without a VGM.
12) What is the shippers’ deadline to provide the required container weight verification to the ocean carrier?
The VGM "cutoff" will vary by carrier and port and is not mandated by the SOLAS requirement. However practically speaking the shipper must submit it early enough for the carrier to use the VGM figure in its stowage plan, which is a requirment the SOLAS rule puts specifically on the terminal and carrier. OCEMA, (the Ocean Carrier Equipment Management Association) issued on March 21 issued best practice guidelines that discuss the VGM cutoff at least for U.S. exports. According to Hamburg Sud it is the shipper's responsibility not just to generate the VGM but to provide it to the carrier, according to this FAQ. Given that many terminals will not be offering weighing services and will refuse entry to any containers that arrive unaccompanied by the VGM, practically speaking the VGM will have to be in the terminal's hands prior to the in-gate cutoff for a particular sailing. Some U.S. carriers however are saying that terminals should be able to in-gate containers with no VGM if it is provided quickly thereafter so as not to disrupt the normal flow of the container from the in-gate through to loading on the vessel. Ultimately any deadlines imposed will be a commercial matter that is not determined by regulation, and could reflect the specific needs of certain just-in-time or high priority cargo provided, as determined by the relationship between the carrier and the terminal and provided the carrier can still use the VGM in its stowage plan. This is where commercial relationships among the shipper, carrier and terminal operator will come into play as it relates to certain cargoes such as bulk exports that are loaded into containers near the port and sent to the terminal in large quantities. A system among the commercial parties will be required to prevent delays to such cargoes. Shippers are already concerned that cutoff times may vary widely among carriers. “The primary concern is that there is no standard process that carriers are using to implement this regulation. Many of us have received emails and alerts educating us that this rule is coming, but with no content on the procedure,” Donna Lemm, vice president at Mallory Alexander International Logistics, wrote in a JOC.com commentary in October. Carriers can be expected to provide shippers with cut-off times within which the carrier must receive the required container weight verification from the shipper for vessel stowage planning prior to shipment. This will likely be a newly imposed cutoff time separate from terminal arrival cutoff to make a certain vessel sailing. The IMO said in May that it will permits goods packed containers that are loaded on a ship before the July 1 deadline and are transshipped on or after July 1 to be shipped to their final port without a declaration of their VGM, as this story reports.
13) Can a carrier enforce the rule selectively for certain shippers but not others?
Very likely not. Carriers are expected to be unwilling anywhere in the world to load containers with a VGM for that container. The reason is that doing so would put the vessel out of compliance with flag state and insurance rules, exposing a the carrier to unacceptable levels of liability in the event of an accident. Thus carriers will become the de-facto agent of enforcement irrespective of how much or little enforcement of the rule exists from government agencies. The size or importance of the customer to the carrier would not matter. The only area where carriers will have flexibility is concerning how commercial penalties and costs, such a terminal storage or re-handling, are passed to customers, and how selectively they do it. While the legal responsibility for submitting VGM lies with the shipper, the carrier is also required not to load container unaccompanied by the VGM. "It is law, and the liabilities (for a carrier) associated with not complying are really enormous" for example if an accident occurs whether at berth or at sea and it were discovered that no VGM had been submitted for a container that may have been involved, World Shipping Council Chairman Ron Widdows told JOC.com on Jan. 19. But if a carrier cannot load a container, the carrier suffers monetary costs — for loss of revenue and any terminal and handling costs associated with a container that was rejected by the terminal for lack of a VGM — even before any fines by the relevant maritime authority. Thus most carriers can be expected to do whatever is necessary to assist the shipper to obtain the VGM information for a container sufficiently in advance of its arrival at the terminal. While some carriers such as Hapag-Lloyd and Crowley have stated already that they will not load containers without the VGM, the reality is the rule is law worldwide and thus compliance is not a matter of choice for the lines. The gate-in event for a container becomes the moment of truth — whether at port or railhead since after that point any costs associated with the container’s rejection becomes the carrier's responsibility, unless it's known in advance that the terminal will weigh the container on behalf of the shipper. But as answers above indicate, it is not yet clear at all which terminals or how many will offer weighing services or who they would even charge for the service. Certainly container lines will want to avoid a scenario where a terminal bills the carrier for weighing a container given the lack of a guarantee that the carrier will be able to pass that bill along to the customer. OOCL has told customers that it will conduct spot checks of containers to determine if the VGM is correct and will shippers face penalities if they provide an inaccurate VGM, as this article states.
14) Are carriers and terminals required to verify the accuracy of the VGM submitted by the shipper?
No. The requirement is for the carrier and terminal operator to ensure only that the VGM has been communicated in sufficient time to be used for stowage planning, and to not load a container for which a VGM has not been provided. There is no legal obligation on the carrier or terminal to confirm the VGM communicated by the shipper, and there is no requirement for the VGM to be conveyed to relevant governmental authorities. There is also no requirement that the carrier or terminal operator weigh a loaded container for which the shipper has failed to provide the VGM, and some terminals are already stating that they will not have services available to weigh containers that arrive at the terminal unaccompanied by a VGM. In fact, as reported here by JOC.com on March 17, carriers are telling shippers they have no plans to verify the VGM provided to them. Accoriding to one major carrier, "I can tell you that on the carrier side there is no focus to investigate/inquire on the origin of the weighing method used by the shipper. As long as we have a certified VGM form, with a signature/name on it, we have covered our portion and will simply transmit to the terminal."
15) What costs is the shipper looking at for non-compliance?
Actual payment fees for non-compliance have largely not been established or published yet by national governments, but the costs for failing to present a certified VGM document in terms of storage or re-handling can be expected to go way beyond any actual official penalties assessed. In terms of penalties, “Depending on national legislation, national maritime administrations can levy punishments ranging from fines and sanctions to jail time. In the U.K., fines and imprisonment are possibilities,” said Global Shippers’ Forum Secretary General Chris Welsh in a Q&A with JOC.com. But there will be other costs as well. Taking a container off a ship and resulting storage will result in costs applied to the carrier by the terminal. Therefore shippers can expect a non-selective approach by carriers to cost recovery especially now when historically low freight rates in certain east-west trades are leaving container lines with little in the way of profits and a high motivation to recover costs applied to them by marine terminals. Carriers can thus be expected to put preventative measures in place to avoid these costs by ensuring they receive the VGM and refuse to accept containers without it. In a broader sense, multi-national corporations adhere to a policy of 100 percent legal compliance throughout their operations, judging the costs for non-compliance irrespective of the law or jurisdiction to be inconsistent with responsible corporate governance. Thus large shippers are digging deep into their supply chains, making extensive process and operational adjustments in order to ensure they will be in compliance by July 1 irrespective of what guidance, or lack thereof, they are receiving from carriers, governments and other parties. This article describes some of the many steps companies are taking to ensure compliance.
16) Under the new rule there are two methods by which a shipper may obtain the verified gross mass necessary for submission to the ocean carrier. What are they?
The two options are Method 1 and Method 2. Method 1 is that upon the conclusion of packing and sealing of the container, the shipper weighs the packed container itself, or arranges for a third party to do it. Under Method 2, the shipper or a third party working on behalf of the shipper may weigh all the packages and cargo items in the container, including the mass of pallets, dunnage and other packing and securing material to be packed in the container, and add the tare mass of the container to the sum of the single masses of the container’s contents. The tare mass, also called unladen weight, is the weight of an empty container. The tare mass of every container is marked on the exterior of every container at the time of manufacture. Shippers should solely rely on the tare mass number marked on the individual container being used, and should not use a standardized weight for any 40-foot container. Where it is missing, or believed to be inaccurate, the container operator should be contacted to take appropriate remedial action. Some shippers have raised the issue that the tare mass may be inaccurate as a result of an earlier repair or some other reason. For this reason shippers are watching closely what variance from the stated VGM that governments will allow, in the event of an inspection, before issuing a violation. Some governments will require approval for those who carry out Method 2 weighing processes. The UK Maritime & Coastguard Agency government states this in an official document providing guidance to shippers on implementing the rule. Usage of Method 2 "requires that the MCA has to approve the certified method used by that shipper."
17) Are there situations where the cargo doesn't have to get physically weighed?
Yes, under Method 2, which allows the contents of the container as well as any bracing materials to be weighed separately and then added to the tare weight (empty weight) of the container, it is possible to sum up the weight of individual sealed cartons where the weight is known in advance and use this figure in the total weight calculation. This method qualifies "so long as the weight is clearly and permanently marked on the surface of each individual sealed package to be stuffed into the container," according to a World Shipping Council spokesperson. "And then the weight of any bracing and securing material, derived by weighing such material, is added along with the tare weight of the container to attain the verified gross mass (VGM) of the loaded container." For example, according to the WSC, "a shipper of identical television sets whose individual cartons are marked by the manufacturer with the shipping weight could calculate the shipment's weight by multiplying the number of television sets in the container by the weight of an individual set, and then adding that to the weight of the combined calculated weight of the packaging, pallets, packing and bracing material and the container's tare weight. This approach has four required elements: It only applies to 1) original, sealed packages, 2) that have been previously weighed, 3) with the accurate mass clearly and permanently marked on their surfaces, and 4) such weights being added to the calculated weight of all packing, securing and other material that may have been used in the packing of the container." The WSC spokesperson added: "We understand this exception will apply to a very small percentage of the total cargo to be moved." However, shippers have pointed out that cartons are made and the weight printed well in advance of the product being packed inside, which could lead to possible discrepancies in the weight of the finished product and its accessories under Method 2. With thousands of boxes in a container, even small discrepancies can make a significant difference to the declared weight. This might help certain shippers in the U.S., said veteran shipping executive Gary Ferulli in a JOC.com commentary published on Feb. 2, 2016. Other than loose agricultural commodities, "those in the U.S. exporting to almost anywhere will have, relatively speaking, the least disruption and additional cost because virtually all packaged goods already have some sort of weight on the packages and in databases for shipping purposes."
18) What are the requirements for those doing the weighing, the weighing equipment itself, and accuracy?
The weighing equipment to be used must meet the applicable accuracy standards and requirements of the country in which the equipment is being used. There is no such thing under SOLAS as a “verified weigher.” The only obligation under SOLAS for any party weighing a packed container is to use equipment certified by the relevant national standards. But national standards may get more specific, for example national governments may as part of their enforcement policies implement requirements applicable to owners of weighing equipment and could determine acceptable levels of accuracy of the weighing equipment used. There is no provision in the SOLAS rule for any margin of error; the rule is only a physical weighing requirement, thus verified gross mass derived using compliant equipment and procedures will meet the legal requirements. Some cargo products may incur normal, minor changes in mass from the time of packing and weighing until delivery (e.g. due to evaporation or humidity changes) and some containers’ tare mass may change over time and vary somewhat from the tare mass marked on the container. However, these margins of error should not normally present safety concerns.
19) Why was the container weight rule put into effect?
Simply put, shippers — not all of them but unfortunately still too many — misdeclare cargo on the bill of lading, whether out of sloppiness, negligence or willful intent to ship more cargo than allowed for the same rate. According to the World Shipping Council, it is not uncommon for the actual total cargo weight on a loaded vessel to be 3-7 percent greater than the declared weight (weights have long had to be declared on the bill of lading, with the difference under the SOLAS rule being that the weight value has to be derived from an actual weighing process). The impact on safety to workers, ships and cargo can be catastrophic, as these photographs, and also those at this link, indicate. Misdeclarations apply both to weight and cargo descriptions, though the IMO VGM rule applies only to weight. When cargo is misdeclared, since the cargo itself isn’t visible and the ship master’s knowledge of the cargo on board the ship is limited to what is stated on shipping documents, there is significant danger inherent in shipping by container. This rule aims to crack down on one aspect of misdeclarations, that applying to weight, in the hope that the safety of container shipping will improve and overall risk be reduced. "Misdeclared container weights have been a long-standing problem for the transportation industry as they present safety hazards not only for ships and their crews but for other cargo on board as well as workers in port facilities handling containers and on roads," Matthew Gore of the law firm Holman Fenwick Willan wrote in a 2014 bulletin. It's an issue that's been on container lines' radar screens for years. Container shipping founder Malcom McLean highlighed the issue to his subordinates. According to William Gottimer, McLean's former personal and business attorney and general counsel for all his transportation companies from 1991 until McLean's passing in 2001, it was a big issue for the Sea-Land Service Inc. founder. "Malcom McLean had a visceral sentiment on the issue of overweight containers. He strongly believed they were dangerous on the road and in the port. I believe it stemmed from an accident he either once had or knew of where the driver was unable to control the load due to weight. He also knew commercially that strict weight restrictions led to more containers that needed to be moved. He had me speak with each of the various transportation departments of the states up and down the eastern seaboard to seek their support to limit overweight containers citing the constant damage overweight loads were doing on the roads."
20) Why does it appear that there is no leadership or coordination to efficiently get the rule implemented by July?
Part of the reason why there appears to be so much confusion, at so many levels, has to do with who's rule this is. The International Maritime Organization is primarily concerned with ship safety and ship operations. The SOLAS convention that was amended to create the rule refers to "Safety of Life at Sea" and traces its origins to the sinking of the Titanic. The IMO has little institutional knowledge of or experience with issues beyond the vessel and especially not into the origins of the supply chain at manufacturing sites where some containers or contents will be weighed possibly hundreds of miles inland from seaports. It is safe to say that in implementing the rule the IMO and others involved were not able to fully envision the complexities involved in complying with the rule, and as a result left the details to commercial parties to work out on their own, with little if any practical guidance other than to say that containers not accompanied by a VGM can't be loaded on the ship. That is why this rule is proving so difficult for so many to get their arms around. The rule brings to mind the U.S. Importer Security Filing, also known as "10+2" to refer to the data points that importers were required beginning in 2009 to submit to U.S. Customs 24 hours prior to the ship sailing from the foreign port. Complying with that rule had significant supply chain implications for U.S. importers, but the rule only applied to the U.S., whereas the VGM rule will be enforced by 171 nations. "Those who wrote the rule have no idea of the complexity of cargo movements through the ports," Agriculture Transportation Coalition Executive Director Peter Friedmann told JOC.com in late January.
21) Is there any global EDI standard in the works to implement the SOLAS VGM rule?
Yes, the UN EDIFACT message standard described in this 85-page document has been published by the standards setting body SMDG, a nonprofit that develops and promotes UN/EDIFACT EDI-messages for the maritime industry and is an official Pan European User Group recognized by the UN/EDIFACT Board. But it’s not yet clear how universal the standard’s adaption will be globally and obviously it won’t apply to the significant amount of cargo whose documentation is currently submitted via hard copy, fax or other non-electronic means. As of early 2016 there was an new effort under way to create a new, standardized electronic shipping document solely for the purpose of conveying the VGM along the supply chain. Hamburg Sud in this Q&A on the SOLAS rule cites the VERMAS standard as one EDI standard that shippers can use to convey the VGM to the carrier.
22) Is there political pushback to the IMO rule?
Yes, particularly in the U.S. where as of February, 2016 there was an effort by agriculture exporters to get the rule delayed (which has since made no progress; indeed there are few if any who believed as of late March that the July 1, 2016 implementation date will get pushed back). However whether there might be any change to the current time frame, which has the rule being implemented on July 1, is purely speculative, and as the World Shipping Council has pointed out, there is no precedent for the implementation of an IMO rule being delayed and no provision in the law for a delay. Nevertheless as of early 2016 there was growing concern that implementing the rule could impact the flow of international trade and thus have economic consequences. Peter Friedmann, executive director of the U.S.-based Agriculture Transportation Coalition, said that since complying with the rule could impact the competitiveness of U.S. exporters relative to exporters from other nations that he says may be lax in their enforcement of the rule. The group has approached the Federal Maritime Commission and members of Congress to express concerns that the rule is unworkable in its current form. For example, U.S. exporters of transloaded agricultural goods, that is, goods that are shipped to the coast via truck or rail and transloaded into containers, may be unable to provide the VGM to the carrier quickly enough to allow a smooth flow of containers through a terminal and on to a ship. For its part, an IMO source said in late January, 2016 that it was aware of no effort to postpone the effective date or implement a phased in approach. According to Friedmann, “Everyone who knows about how cargo moves from the origin and onto a ship knows that this thing is absolutely unworkable and will create unbelievable congestion unless minds who are familiar with how cargo moves are allowed to intercede.” However as of March, 2016 there was no indication that the July 1 implementation date would be pushed back.
22) What happens if upon inspection variation is found between the VGM and the actual weight of a container?
This question is still very much in the air and possibly a major hurdle to worldwide implementation. It's an open question how aggressively national maritime agencies will police the VGMs submitted by shippers. A review of U.S. Coast Guard enforcement activities by JOC.com found little if any inspection of actual container weights as compared to weights as submitted in the bill of lading. But shippers wanting to ensure they remain in compliance with the law need to know what official tolerances versus stated VGMs will be. They want there to be a global standard though as of early April, 2016 no-global standard had emerged. Under the SOLAS rule, variances to the signed VGM weight aren’t necessarily illegal but must be defined by the maritime authority of the country where the container was packaged and loaded, opening the door to as many regulatory regimes as there are participating states. The World Shipping Council recently published a country-by-country breakdown of official published regualtions (showing that as of late March, very few countries had weighed in). The U.K. Maritime & Coast Guard agency said in a document issued in 2015 explaining how it will implement the rule that “It is anticipated that Regulators and other authorised cargo inspectors will use an enforcement threshold ±5% of the verified gross mass of the container. However, this will be used on a case by case basis.” (See section 13.1) The key point there being “anticipated” and with the U.K. being the only nation to have published guidance on variation, it remains to be seen how the UK will actually implement the rule and if other countries will match the plus or minus 5 percent threshold for the sake of uniformity, or establish a different threshold altogether. Shippers concerns in this regard stem mainly from the tare weight of the container. It is the shipper that is required to verify the total weight of the container and its contents, yet other than using the tare weight printed on the outside of the container, shippers have no way of knowing the real weight of the container. For shippers using Method 2 in which the tare weight is added to the weight of the contents and packing materials, they could face fines if actual combined weight differs significantly from the total weight as weighted by the Coast Guard or other authority. This is the essence of the dispute that was playing out in the U.S. as of March, 2016 in regards what information the shipper will be forced to supply to comply with the VGM rule.
23) Do containers being transshipped have to be weighed again at the transshipment port?
No, according to an Hamburg Sud FAQ, all packed containers discharged from a SOLAS vessel in the transshipment port should already have a VGM and therefore further weighing in the transshipment port is not necessary.