Ocean Network Express feels it is being singled out by the US Federal Maritime Commission (FMC) following the regulator's decision to launch an investigation into its allegedly unreasonable practices.
The Singapore-headquartered liner said in legal filings on Wednesday that the incident prompting the investigation was a unique circumstance that happened three years ago and does not place undue burdens on the US supply chain today.
"Setting up ONE as simply the first in a row of dominoes is unjust," the liner operator said in a motion for reconsideration.
The FMC began its probe on 30 December, looking into ONE's use of merchant clauses following a legal dispute with Greatway Logistics.
The commission said ONE's terms and conditions considered Greatway to have an ownership interest in the cargo — two shipments of pine plywood carried from Brazil to Houston — when it did not.
In its filing, ONE said the 2018 dispute led to a lawsuit in early 2019 when the liner attempted to recoup demurrage and storage charges.
ONE said it included Greatway as a defendant in the lawsuit as it appeared to be acting as if it had an interest in the cargo by refusing to make changes to bills of lading, but ended up dismissing the company.
Greatway was eventually dismissed from the lawsuit and ONE said it even admitted to taking actions that could suggest it had a beneficial interest.
The liner operator would later settle with other, non-Greatway parties.
Singapore-based ONE, a joint venture of Japan's NYK Line, K Line and Mitsui OSK Lines, said it believes it has more reasonable merchant clauses than other carriers and that the FMC should look into the entirety of the industry, not just one company.
The company further argued the one-off event does not legally constitute a practice nor was its actions unreasonable. The outfit argued that the FMC wrongly chose to waive its policy of informing targets of potential investigations ahead of a formal probe.
It said the FMC's rationale was to de-clog the supply chain, which has made headlines as US consumer prices rise.
"The order gives no reason or rationale as to how this hearing will 'alleviate stress' on the
supply chain, or how this unique episode in 2018 — where upon clarification of the relevant facts ONE decided not to seek to collect demurrage from Greatway — will move any current cargo any faster," ONE said.
Following President Joe Biden's executive order in July 2020 instructing the FMC to look into detention and demurrage charges, the commission has taken a more aggressive stance toward container shipping.
The agency launched several initiatives to investigate liners and their practices toward US shippers as well as a push to gain new powers to investigate the conduct of liner operators.
The FMC has also begun looking into Wan Hai Lines over daily fees charged for containers levied regardless of whether or not it gave return instructions or if the terminal was open to receive the container.
The FMC is also considering a complaint made by MCS Industries against Mediterranean Shipping Co.
That dispute sees MCS Industries accuse MSC of agreeing to provide MCS Industries with cargo space that it then refused to provide.
