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EUROMOVERS International

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BIFA calls for end to surcharges

Jul 19, 2018
The British International Freight Association (BIFA) has called for an end to surcharges imposed by shipping lines.

This follows recent announcements by the world’s leading container shipping companies, almost in unison, that they would be levying ‘emergency’ bunker surcharges in response to rising fuel costs.

“Forwarders do not like shipping line surcharges of whatever nature and we have been challenging their legitimacy on behalf of our members, and their customers, for many years,” said Robert Keen, BIFA Director General. “In the past, we have seen equipment imbalance surcharges, peak season surcharges and currency surcharges, in addition to fuel surcharges. The number of surcharges and fees continues to grow, often with no real explanation or justification. For instance, what does an extra ‘administration fee’ or ‘container sealing fee’ cover that is not in the standard service offered?”BIFA has been challenging the legitimacy of surcharges for many years

Shippers can also be asked to pay surcharges when there is port congestion caused by labour unrest or bad weather, or haulage surcharges when there is a shortage of HGV drivers. BIFA says that forwarders do all they can to minimise the effects of the surcharges but in the end at least some of the costs need to be passed on to the customers.  “There is sometimes an unfair perception that our members are to blame,” said Robert.  “If a shipper enters a contract to buy goods they should know exactly what they are paying and that price should not change.”

According to iContainers, however, the trickle-down cost, while frustrating for shippers, is a fair move by the shipping lines. “The Emergency Bunker Surcharge is a result of market movements,” said Klaus Lysal, Vice President of Operations at iContainers.  “It’s fair for carriers to pass this additional cost on to their clients since it’s a cost that they do not control and can change drastically depending on factors that they have absolutely no influence over. The exasperation felt by shippers is completely understandable and natural. But despite the backlash, I reckon some shippers would prefer to pay a little more overall and have fewer surprises come into their supply chains such as changes to rates and services.”

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