Presentation by Mr Llew Russell,

1
Presentation by Mr Llew Russell, Chief Executive
Officer, Shipping Australia Limited to the
Chain of Responsibility Conference Sydney,
23-24 June 2008
Shipping industry and the chain of
responsibility
2
I will be addressing the following issues

• Background to the shipping industrys involvement
• Industry code of practice
• Current examples of overweight containers
• Compliance issues
• How to progress from here?

3
Shipping industry has been concerned about
mis-declared container weights for over 11 years

• Shipping industry raised mis-declared container
  weights as an issue back in 1997 and we were
  subsequently involved in the TWU call for all
  containers to be weigh-bridged.
• The reason for the shipping industrys concern is
  not necessarily containers over road limitation
  weights (clearly a matter of concern) but rather
  mis-declared weights which can see the wrong size
  truck being delivered to pick up the container
  and other problems.
• Road traffic authorities are more interested in
  import containers than export but the shipping
  industry vitally concerned with both.
• This issue affects almost all links in the
  through transport container chain from ships
  stability, overloading trucks, serious
  stevedoring accidents and so on.

4
Why are containers overloaded?

• Whilst there could be cases of deliberate
  overloading eg. to reduce the total number of
  containers required, a more rational explanation
  in many cases is simply a lack of concern.
• Failure to properly calculate weights taking into
  account, different units of different products,
  packaging, dunnage, the tare weight of the
  container etc. Access to weighing facilities an
  issue.
• You would have already heard a lot about the
  National Compliance and Enforcement legislation
  and where it currently sits amongst the various
  jurisdictions but early in the piece we worked
  with Meyrick and Associates in developing a
  voluntary code of practice for this industry.
• A copy of the code is included with your papers
  for this conference but regrettably it has never
  been officially recognised.
• SAL continues to promote its observance as a
  means of mitigating potential liability.

5
Why are containers overloaded?

• Needs to be implemented in conjunction with
  action by those arranging road transport for
  example eg. careful examination of commercial
  documents prior to producing a Container Weight
  Declaration is advisable.
• Consignees and consignors should be made more
  responsible.
• Legislation relates to overloading not accurate
  weights.
• Ensure overseas suppliers include content and
  tare weight on packing lists, for example, for
  all future shipments.
• Sometimes difficult to even determine what is
  supposed to be the average weight of a container
  if a number of containers are included in the one
  Bill of Lading and only an overall weight may be
  provided. (Packing lists should provide this
  detail)
• Important in the future perhaps that weight of
  each container is accurately identified.

6
Current examples of overweight containers

• During this year in Australia we have experienced
  problems with mis-declared weights with
  containers which have been discovered overseas
  when the container has been weighed.
• There have been famous cases this year of the
  Annabella and the MSC Napoli which highlighted
  the problems of overweight containers and the
  problems they cause for vessels and crews.(Feeder
  and overseas)
• In the case of the Annabella the stack of 30 foot
  containers collapsed into the hold of the 868
  feeder, because weight limits had been exceeded
  for these non ISO containers.
• Interestingly the incident could have been far
  more serious as the top three containers in the
  stack were carrying butylene gas.
• During a UK conference on the Annabella this year
  the interesting point was made that crew also
  needed to be included in the information chain
  and to me this is vitally important.
• International Chamber of Shipping is working with
  the Washington based World Shipping Council on
  best practice guidelines which will also take
  into account findings from the Annabella and MSC
  Napoli accident in the UK.

7
Annabella crushed container
8
MSC Napoli
9
The case for accurate weights

• The Maritime Accident Investigation Branch (MAIB)
  report on the MSC Napoli found mis-declaration of
  weights and contents of containers was a
  contributing factor in the accident
• Noted many shippers/consolidators do not have
  access to weighing facilities and mis-declaration
  erodes or eliminates safety margins.
• Overweight boxes influence stack wt, changing
  metacentric height (GM) calculations, affecting
  stability and safety in heavy weather.
• Est. 5-10 of all boxes carried are overweight.

10
Compliance issues

• Early this year SAL wrote to the National
  Transport Commission relating to their compliance
  enforcement legislation.
• The CEO replied outlining briefly the intention
  of the legislation to meet NTCs chain of
  responsibility and outlined the communications
  programme that is associated with rollout of the
  model legislation. (Slight differences in most
  jurisdictions)
• NTC acknowledged the point made by SAL there
  needs to be a continuous education of parties
  influencing the transport chain under this
  legislation and he pointed to a number of
  jurisdictions that were taking such a proactive
  approach.
• Of interest is also the fines that are being
  levied in the grain handling industry for
  overloading trucks.
• Nevertheless the NTC pointed that these matters
  of operational nature are guided by the resources
  and operational directives of each jurisdiction
  but NTC did pass on our concerns through the peak
  standing group for the CE legislation, the
  Transport Agencies Compliance Committee at its
  meeting in mid February 2008.
• The NTC also shared SALs view that successful
  prosecution for persistent offenders under the
  provisions of the legislation will have a
  positive educative and behavioural effect on
  parties in the transport chain.

11
Weighting of containers

• It is not necessarily a simple matter to get an
  accurate weight of the container and its contents
  in practice. Lifting equipment whether it be
  gantry cranes, fork lifts, straddle carriers are
  subject to stresses caused by unequal loading,
  wind and so on which can give false readings.
• Different truck weights and trailer weights along
  with the container could be consistent with
  overall gross limits but in effect have a
  mis-declared weight in the container. (Again
  depends on where in the chain the container is
  loaded)
• Really needs to be matched with what is on the
  commercial documents which clearly should be
  conveyed electronically at the time eg.
  electronic weigh-bridge at say container terminal
  gates. (Or new weighing technology)
• Truck companies could provide this information
  electronically prior to setting out to the
  container terminal. (What happens when a
  container is found to be overloaded?)
• The important point is to develop procedures
  which will give reasonably accurate weight for
  the container as a whole ie. the gross weight.

12
How to progress from here?

• It has been reported in the media last month
  besides the development of a best practice code
  for the container shipping industry by the end of
  this year, the ICS is advocating the adoption of
  a voluntary code by the International Maritime
  Organisation and subsequently the maritime
  industry on weighing containers.
• Peter Hinchliffe of ICS has told a seminar that
  he hoped the code would enable the industry to be
  self regulating and able to influence local
  legislation.
• The code will be presented to the December
  meeting of IMOs Maritime Safety Committee.
• The code calls for the weighing of containers at
  pre-shipment but the industry is eagerly awaiting
  suggestions as to how weights will be validated
  as I have outlined previously.
• This proposed action is against the background of
  a number of classification societies and others
  calling for the weighing of all containers prior
  to shipment.

13
Draft ICS Best Practice Guidelines in the
container industry

• Currently points out that weighing only part of
  the problem Code covers many issues
• Regulatory environment, standards, packing,
  shippers responsibilities, ship planning,
  observing road/rail wt-limits, intermodal, marine
  terminals ops, master and crew responsibilities
  etc.
• On weighing, recommends shipper to weigh,
  avoiding overloading (above ISO standard)
  stevedores to verify weight against
  documentation, shore to ship data exchange on
  weights, audit system, random selection, EDI used
  to override inaccurate weights found.

14
Conclusion

• As you can see there is light at the end of the
  tunnel and hopefully it is not the approaching
  train.
• We support an international voluntary code but
  would have concerns with any mandatory action to
  make pre-weighing a legislative requirement
  certainly in the absence of proper validation
  techniques and accuracy in terms of determining
  the actual weights. (And who determines them)
• SAL continues to promote the code of practice to
  our industry
• SAL will be actively pursuing a multi-disciplined
  approach for this issue including urging State
  jurisdictions to enforce the new legislation and
  determining how technology including IT can
  assist in finding solutions that will not only
  provide an overall improvement but not inhibit
  our trade facilitation efforts.
• Questions