Uncollected or Abandoned cargoes
Avoid Abandoned Cargo Claims
Abandoned cargo is now becoming one of the most worrying developments for freight forwarders. Cargo is uncollected and abandoned for numerous reasons and can be as broad as customs holding the goods to a commercial dispute with the shipper/consignee or even an unscrupulous shipper loading dubitable cargo.
Regardless of the reason, master carriers have become increasingly determined, investing an enormous amount of time and money to ensure they recover their costs and have broadened their terms and conditions to make it much easier to collect from the booking parties. Freight forwarders are often caught up in this situation, not realising the seriousness until it is too late.
If you are booking cargo and/or show yourself on the master bill of lading then you can be fully responsible for demurrage, storage, destruction and other charges of any uncollected cargo. Do not assume the master carrier will not have course against you because you do not own the cargo or because you have been given reassurances by the shipper/consignee the cargo will be cleared and that they will cover these costs. Whilst the cargo owner is ultimately liable, you are responsible for these charges in the first instance in the same way you are responsible for your clients’ cargo whilst under your care.
The majority of all abandoned cargo cases would only be a fraction of what is eventually paid if handled correctly. A common mistake of freight forwarders is to not take immediate action. Ignoring carriers’ notices and/or accepting merchants’ reassurances will leave you exposed to some of the biggest claims you will find on your books. Time is crucial in these situations and each day that passes makes the cargo less collectable.
Unfortunately, no one is immune. To minimize your chance of being a victim, you can take certain precaution:
- Pay close attention to any container overdue and incurring charges. This immediately becomes your problem.
- Do not delay. Most cases can be resolved quickly before costs escalate with pressure on the shipper/consignee. Remember that merchants rarely cooperate once costs mount and exceed the value of the goods.
- Whilst booking a cargo can still place you in a vulnerable position, do take the precaution to avoid being named as the shipper/consignee on the MBL.
- The majority of abandoned cargo are of low value or freehand shipments, so pay more attention or avoid low value shipments altogether. If you are not comfortable with the type of cargo or the shipper, then you should think twice whether the revenue for the shipment is worth the risk of potential claims.
- Try to have the cargo unstuffed and placed in a bonded warehouse to save costs.
- Make the shipper/consignee aware they cannot abandon the cargo without any recourse against them. In so many cases Freight Forwarders sign Letters of Abandonment without knowing the implications against them and forgo any chance of recovery from the cargo owners.
