MSC Assessed Civil Penalties Totaling $22.67 Million

Here are key takeaways:

• Total penalty: The Federal Maritime Commission assessed $22.67 million in civil penalties against MSC Mediterranean Shipping Company across three categories of Shipping Act violations.
• “Merchant clause” violation ($65,000): Between 2018 and 2020, MSC improperly billed customs agents as “notify parties” for demurrage and detention charges via its “merchant clause,” even though those parties were not involved in moving the cargo.
• Tariff transparency violation ($9.46 million): From 2021 to early 2023, MSC failed to include required fee disclosures for non-operating reefers in its published tariff. Penalties escalated to reflect knowing and willful violations starting from March 2022, when MSC told the Commission it would modify its tariff but did not.
• Overcharging violation ($13.145 million): MSC overcharged demurrage and detention fees on approximately 23% of all non-operating reefer bills throughout 2021. The Commission reversed the Administrative Law Judge’s initial ruling, finding the overcharging was not a billing mistake but an unreasonable practice under the Shipping Act.
• Where the money goes: The Federal Maritime Commission does not retain civil penalty revenue — all payments go directly to the General Fund of the U.S. Treasury.