South Korean Company Failed to Perform Inland Transport Obligations, Samsung Tells FMC
South Korea-based SM Line Corp. failed to properly perform its transportation obligations to inland destinations, leading to unfair detention and demurrage charges, Samsung Electronics America said in an April 19 complaint filed with the Federal Maritime Commission. Samsung accused the global shipping company of "unjust and unreasonable" practices in handling property, providing invoices without "adequate information" and imposing unreasonable charges in violation of U.S. shipping regulations. Samsung asked the FMC to require SM Line to pay Samsung reparations for the "unlawful conduct" and order it to stop the conduct. Samsung also requested an oral hearing.
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From late 2020 to mid-2021, Samsung said SM Line failed to "perform its obligations for inland transportation," leading to unfair detention and demurrage. The electronics company also said it was "forced to undertake and perform the ocean carrierʼs inland transportation responsibilities in order to continue to import its products sold to American consumers" and was "forced" to pay charges that were not its responsibility.
Samsung said it had to "undertake significant ocean carrier responsibilities in order to facilitate the inland movement of its cargo, including arranging for inland trucking and paying SM Line’s inland terminal charges without reimbursement from SM Line." The company called the amount of demurrage and detention charges "staggering," adding that they present a "material threat to [Samsung's] ability to provide its products to American consumers, and has made it necessary to bring this Complaint."
Samsung said it chose to work with SM Line because it offered "a full range of services," including the ocean carriage of Samsung containers and the inland carriage of the containers to Samsung warehouses or directly to customers. As a result, if delays happen, SM Line would be responsible for detention and demurrage payments and "not a consignee" like Samsung, the company said, especially when SM Line is responsible for creating those delays.
Samsung said it asked SLM Line to waive some of the charges, but the shipper "refused." SM Line's invoices and billing information "routinely lacked adequate information to determine the basis for the individual demurrage and detention charge," Samsung said. SM Line also did not "engage in an adequate or meaningful dispute resolution process for demurrage and detention charges," Samsung said. SM Line is also continuing to engage in these practices, meaning that Samsung "continues to sustain injury and [damage]," the complaint said. Samsung added that it tried but failed to resolve the matter with SM Line before filing the complaint.
SM Line did not respond to our request for comment.