U Shippers Group has lodged a complaint with the Federal Maritime Commission (FMC) alleging carrier Maersk to have violated a 2020 shipping contract.
According to U Shippers Group, in the contract Maersk committed to providing minimum space on its carriers for U Shippers members. Meanwhile, Maersk was introducing a new online booking platform, Twill. Still in development stages, Maersk and U Shippers reached an agreement for the association to use the booking system exclusively for a two-year period.
The association, in exchange, would use the platform with its members. The complaint noted that beginning in late 2020 or 2021, Maersk undertook a “series of acts” designed to shut out U Shippers from utilising space committed under the Service Contract.
In January 2021, through June 2021, Maersk repeatedly declined to provide the shipping volume it committed to in the Service Contract, U Shippers alleged. The refusal to provide space forced U Shippers members to obtain space on other vessels at inflated spot market rates.
What is more, U Shippers claims that the Service Contract obligated Maersk to pay U Shippers a Volume Incentive Program (VIP) based on the number of containers shipped by Maersk.
Continuing, U Shippers added that the failure to provide space reduced the amount of VIP payments U Shippers was entitled to under the contract.
This unreasonable practice resulted in a cash flow shortage for U Shippers
the association added.
Taking the above into consideration, U Shippers alleged that Maersk’s actions led to eight violations of the Shipping Act including unreasonable and undue preference to shippers other than U Shippers; and unfair or unjustly discriminatory action.
In fact, through lost fees and higher shipping costs from alternative carriers, the association claims its members have lost $180 million and currently accruing and to be further demonstrated in lodging the complaint.
Interesting article. Seems Maersks woes know no end.