YANG MING SETTLES US SHIPPER'S CLAIM THAT CARRIER BROKE ITS CONTRACT

Yang Ming has reached an out of court settlement with a shipper that claimed it was a victim of pandemic-era price manipulation.

The complaint was lodged with the US Federal Maritime Commission (FMC) by Delaware-based food shipper MSRF last August, alleging the Taiwanese carrier refused to provide the full capacity agreed in service contracts – “instead, forcing MSRF to buy space on the inflated spot market”.

It alleged: “[Yang Ming] refused to provide more than a fraction of capacity requested and needed, even though it overall has continued to operate at, or near, pre-pandemic capacity.

“[Our] written service contract with [Yang Ming] included minimum quantity commitments to tender cargo from various points in Asia for [Yang Ming] to transport via ocean vessels to the US at agreed intervals and for agreed prices.”

“[Yang Ming] then proceeded to engage in a practice of refusing to perform full commitment under the service contract, instead forcing MSRF to buy space on the inflated spot market.”

At the time, a container that, pre-pandemic cost approximately $2,700 to ship from China to the US west coast, was being quoted at $25,000 or more and, in the period under scrutiny – May-December 2021 – Yang Ming carried just four of the 100 contracted feu boxes, claimed the shipper.

MSRF said as a result of “the carrier’s practice of selling MSRF-contracted space on the spot market”, it had lost in excess of $1m and was seeking “remuneration and damages”.

But, following “arms’ length negotiations”, the two parties submitted a joint motion in support of a confidential settlement, which the FMC approved last week.

Source: theloadstar.com by Alexander Whiteman