Global Shippers’ Forum Webinar 7 September 2012

1. Global Shippers’ Forum Webinar7 September 2012 Mandatory weighing and verification of container weights – implications for shippers Presented by Chris Welsh Secretary General Global Shippers’ Forum Webinar 7 September, 2012

2. Global Shippers’ Forum Webinar7 September 2012 • Brief background to GSF & objectives -Incorporated in June 2011 (represents shippers in Asia, Africa, Europe, North & South America -UN accreditation to intergovernmental transport organizations • The issues keeping us awake at night -maritime competition and shipping cartels -maritime emissions (bunker levy proposals to increase global ocean rates by $5 per tonne) -maritime safety legislation aimed at shippers -aviation security -e-commerce • The topic for today – ‘Mandatory weighing and verification of container weighs – implications for shippers’

3. The Implications for Shippers • New mandatory legislation aimed at shippers • Additional handling costs • Delays in the supply chain • Extended liability for damage caused through poor stowage/misdeclarations • Greater focus on shipper’s responsibilities in the “chain of responsibility” • Insurance & other costs associated with • damage • YOUR FEEDBACK ON PROPOSALS

4. Two principal issues a) Safe loading of containers - Revision of IMO/ILO/UNECE guidelines into a voluntary Code of Practice b) Mandatory weighing of containers - Compulsory verified weight certification

5. Safe loading of containers • Industry, governments and unions in agreement that safety in supply chains can/should be improved • Poor loading practice, the MSC Napoli, Annabella, Riverdance, Flaminia; and other high-profile cases

6. Safe loading of containers • ILO/IMO/UNECE Voluntary Code of Practice to include: “What” and “How” - Technical annexes - manuals and training materials • To be applicable not only to maritime transport but also to rail, road and inland waterway modes

7. Safe loading of containers - GSF position • There is no need for further regulation. Improvements in global container safety can be achieved by - • Communicating best practice advice on loading and securing goods, which already exists, throughout the supply chain • Providing training and thereby raising the awareness of loading skills/securing techniques of workers stuffing containers

8. Safe loading of containers - GSF position • Reviewing shippers’ performance by auditing companies, possible accreditation scheme (known consignors) and introducing KPIs (cargo condition at destination etc.)

9. Safe loading of containers - workstream • Meetings have taken place over the summer with the WSC, ICS, IMO and other stakeholders • To gain endorsement of GSF’s position from its members (which is really what today is all about) • A further meeting of the Group of Experts (chaired by Chris Welsh) taking place in Geneva in October 2012 • Completion of the new IMO/ILO/UNECE Code of Practice is scheduled for May 2014

10. Safe loading of containers - GSF actions GSF to produce a variety of outputs which will contribute to the achievement of the GSF’s objectives, including: • safety sticker for vehicles/terminal handlers • pocket guide for container packers • ‘safety tips’ wallchart • safe loading guide for shipping managers • development of training courses and • internationally recognised accreditation

11. Mandatory weighing of containers • This is a separate IMO but related issue to the work on container safety currently being carried out by IMO/ILO/UNECE • National authorities, industry and unions are in agreement that, ideally, the shipper stuffing the container should supply accurate container weight information

12. Mandatory weighing of containers • There is recognition that this is not always possible for a wide variety of reasons – part container loads (groupage) only, no weighbridge facility, ingress of water, product weight changes in transit & condensation etc.

13. Mandatory weighing of containers • The GSF believes that all stakeholders have a part to play in ensuring and improving the safety of supply chains • Shippers recognise that misdeclaration of container weights is a real issue but believe the extent of the problem has been exaggerated • Millions of containers are transported on ships every year but only a few hundred are lost at sea according to the WSC

14. Mandatory weighing of containers - facts • Fact – not all losses are attributable to misdeclaration of weight by shippers • Fact - terminal/carrier interface could be improved (stow plan, turnaround time….) • Fact - Marin Report 2009 – noted carrier shortcomings • Fact - The World Shipping Council proposes a verified weight certificate – but who should do the weighing?

15. PROPOSED WSC AMENDMENT TO SOLASChapter VI, Part A, Reg. 2 • “A freight container containing cargo shall not be loaded aboard a ship unless the master or his representative and the terminal representative have the verified gross weight of the container obtained by a weighing of the container. Such verified weights shall be available sufficiently in advance of vessel loading to be used in the vessel stowage plan.”

16. Mandatory weighing-developing a GSF position • Existing SOLAS rules stipulate that shippers are responsible for accurate weight and consignment declarations • In theory, shipper can be liable for damage caused to the ship, other cargoes and injury to people arising from misdeclaration • World Shipping Council et al proposal does not extend additional responsibilities directly to the shipper • The proposal extends responsibility to the terminal representative-this is new • GSF minded not to expressly oppose the WSC proposal, but to highlight the practical difficulties with implementation?

17. Mandatory weighing – developing a GSF position Problems: • Will not reveal if the goods are properly restrained or evenly distributed within the container • Will not reveal if weight has changed since issue of the weight certificate (water ingress etc) • Will add time, cost and complication to supply chains - disproportionately

18. Mandatory weighing – developing a GSF position Problems: • Thousands of small volume or infrequent shippers are unlikely to be able to provide accurate container weights. • Who would verify a non-accredited shipper’s or forwarder’s weight certificate? What about groupage loads? • Weighing at terminals the most likely solution but there are problems with this

19. Mandatory weighing – developing a GSF position Solutions: • Calculated weight should be an acceptable alternative for ‘known’ or ‘accredited’ shippers? • Physical weighing should not be necessary for volume/regular shippers with homogenous / known loads? • A degree of tolerance should be acceptable to carriers, perhaps 1% or 1 tonne More…….?

20. Mandatory weighing of containers Solutions: • Need for a 5 – 7 year lead time to allow for global installation of weighing facilities • Education, training and rollout of best practice preferable to mandatory 100% weighing

21. Mandatory weighing of containers Finally: • Not all IMO representatives are supportive of mandatory weighing – too many unknowns • A difficult process for Maritime Administrations to enforce • No evidence that deaths have resulted from absence of mandatory weighing • IMO to continue the debate in September 2012

22. GSF Global Shippers’ Summit and Annual Meeting-London 22-23 October 2012 • GSF Global Shipper Summit to debate proposals and much more with: - International Maritime Organization (IMO) - International Labour Organization (ILO) - International Transport Federation (Labour organisation) - World Shipping Council (Christopher Koch) - International Chamber of Shipping • Climate Change-Development of market based mechanism to charge for CO2 emissions - European Commission - IMO - Shipowner proposals-bunker levy - GSF Annual Meeting -UBS financial and sea and air supply-demand forecasts for 2013 -Tour of new Thames Estuary port -Gala dinner on the Cutty Sark at Greenwich

23. Chris Welsh Secretary General Global Shippers’ Council Tel:+44 (0)1892 552384 Mobile:+44 (0)7818 450556 Email:cwelsh@globalshippersforum.com Web:www.globalshippersforum.com