Lack of Insurance adds to Hanjin’s Woes

Sadie Keljikian, Top Billion Finance

The latest issue in the Hanjin Shipping bankruptcy scandal surrounds a lack of insurance on chassis in the US.

Chassis provider Flexi-Van Leasing has requested assistance from a federal judge to cancel all its per-diem leasing agreements with Hanjin. Flexi fears that Hanjin will send “thousands” of chassis onto US highways without proper insurance coverage.

Ever since Hanjin’s filing for protection in a Korean bankruptcy court on August 31st, significant controversy has surrounded the fate of goods, containers, and ships under the Korean shipper’s jurisdiction. Formerly the seventh-largest container shipping company in the world, Hanjin’s losses dramatically affected the international shipping and trade industries.

Flexi-Van Leasing, a New Jersey-based provider filed the motion in US District Bankruptcy Court. The claim is that Hanjin’s insurance ceased on October 10th when the shipper failed to pay its premium. Flexi-Van says that when Hanjin failed to pay its premium, thousands of uninsured chassis in Hanjin’s possession. Hanjin has suspended all deliveries except to ports, but can resume deliveries at any time, according to Flexi-Van’s filing.

The current state of affairs relating to Hanjin is concerning US creditors and customers, understandably, but the Newark court is attempting to resolve some of them. Hanjin is seeking Chapter 15 status in the US, which would allow the shipper to move forward with bankruptcy domestically.

Although the court has yet to rule on Hanjin’s Chapter 15 status, it has on many of the other issues surrounding the shipper’s recent difficulties. Keeping up has proven a challenge as the court addresses dozens of attorneys working for numerous involved parties. Cargo owners, container companies, logistics providers and terminals are just some of those approaching the court for assistance.

In the last month, the court has already determined next steps for Hanjin and its customers. The court has instructed shippers in securing release of their cargo, told Hanjin what to do in order to deliver goods to their destinations, and decided what happens to the containers and chassis after the goods have been delivered. Customers of Hanjin continue to raise issues, mostly relating to damages incurred and payments made to Hanjin.

Flexi-Van claims that Hanjin owes them $3 million for services provided prior to the bankruptcy filing and held several contracts with the shipper, all requiring insurance coverage. Flexi-Van has requested a termination of their agreements with Hanjin, as well as payment for their insurance premium. In theory, this will allow delivery of all goods to move forward as originally planned.

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Brown Marmorated Stink Bug Strikes Exporters

Exports to Australia: Brown Marmorated Stink Bug (BMSB) SeasonBrown Marmorated Stink Bug, pictured here from Penn State's Department of Entomology

Australia’s Department of Agriculture and Water Resources has developed measures to manage the 2016-17 brown marmorated stink bug (BMSB) season. In addition to standard import requirements, these measures affect ocean FCL & break-bulk shipments of targeted tariffs imported from the United States between 1 September 2016 and 30 April 2017. A complete list of the exact commodities subject to these measures can be found here. The department considers goods transported on flat rack containers to be break bulk cargo. LCL shipments are excluded.

Break bulk goods treated for BMSB before December 1, 2016 must undergo treatment within 96 hours of loading. Containerized goods sealed after treatment and arriving with seals intact are not subject to a treatment window. Break bulk goods treated on or after December 1, 2016 are unlikely to become re-infested, so are not subject to a treatment window. Commodities manufactured after December 1, 2016 are exempt, as long as they are accompanied with a Not Field Tested (NUFT) Declaration that includes the Date & Place of Manufacture. A good is only considered to be newly manufactured after 1 December 2016 if all of its large, complex components have also been manufactured after 1 December.

Treatment Certificates must identify the Cargo Treated & include a unique identifiable link to the consignment, specify the date, type & timeframe of treatment and include a plastic wrap declaration. Australia’s Document Requirement Policy is available here.

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Definition of Importer Security Filing Importer

Notice of Proposed Rulemaking for Definition of Importer Security Filing Importer

US Customs and Border Protection (CBP) has issued a notice of proposed rulemaking in the Federal Register regarding the definition of the Importer Security Filing (ISF) Importer. The proposed rule would broaden the definition of the Importer for certain types of ISFs filed, for example foreign cargo remaining on board (FROB), IE, TE and FTZ admissions.

Comments must be received on or before September 6, 2016.

Additional details can be found at the Federal Register here.

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Gibraltar Port Gains Edge

Sadie Keljikian, Top Billion Finance

The Honorable Albert Isola, Gibraltar’s Minister for Shipping, hosted a working breakfast at Gibraltar House in London recently to draw attention to the ongoing work being done to make Gibraltar a more attractive port to international clients. The gathering was held in honor of London International Shipping Week and included discussions on the port’s new cargo handling facilities, on-site towage companies, and added cruise accommodations.

The Gibraltar Ship Register, a member of the Category I Red Ensign Group of the United Kingdom and United Kingdom dependency registers, represents nearly every type of commercial vessel. The port, constructed in 2005, is strategically situated to take advantage of Mediterranean transit.

“It is hugely helpful to have face to face and open communication with our major suppliers and to work through directly with them [to] improve the Gibraltar proposition, for the benefit of all those who work with and service clients of the port,” said Isola.

Peak Season for Asia-Europe Trade Falls Short

Sadie Keljikian, Top Billion Finance

Q3, often the most profitable season for the Asia-Europe trade lane, has been decidedly lackluster thus far. Analysts largely attribute the decline to the recent Russian economic downturn.  Merchandise for the winter holiday season typically begins to ship now as retailers and carriers alike in Europe and the US prepare for their busiest time of the year.

In anticipation of the holiday uptick and subsequent overcapacity, Asia-Europe carriers often use intentionally cancelled sailings within a journey, also referred to as void or blank sailings, to increase freight rates and avoid exceeding capacity.  In other words, a carrier will cancel certain legs of a journey opting for the most direct route to its destination.  Such route reductions are being applied more permanently to compensate for the significant decrease in activity this holiday season.

Warehouse Explosion in Port of Tianjin Results in Shipping Disruptions


A warehouse containing hazardous chemicals in the Port of Tianjin, China exploded causing significant disruptions to onshore operations. Shipping traffic carrying hazardous products into the port has been halted and operations at two container terminals have been suspended. Port operations, however, are normal for Northern China’s largest port and main maritime gateway to Beijing.

We will provide updates in the event that further port disruptions unfold.

Weather Alert: Shipment Delays Expected in Shanghai Through Weekend

Current severe weather conditions in Shanghai, China are affecting normal operations of handling ocean and air shipments.  Thunderstorms are expected to continue over the next few days causing loading and unloading operations to experience delays and cancellations.


Drayage drivers picket LA, Long Beach marine terminals


Jon Slangerup, executive director of the Port of Long Beach, said the drivers’ pickets are informational in nature and are not affecting cargo-handling.

“Let’s be clear, this is not a strike. We do not expect there will be any adverse impact to port terminals,” he said. Longshoremen are moving cargo, and trucks continue to move freely into and out of the terminals, Slangerup said

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