Law Offices of Countryman & McDaniel
THE CARGO LETTER 
Air & Ocean Logistics - Customs Broker News
28 August 2008
Good Thursday Morning from our Observation Deck......overlooking the officially designated "Cargo City" area and...... Runway 25-Right, at Los Angeles International Airport, voted "Best Cargo Airport in North America.". Here is what happened in our industry during August 2008!
Well, the Beijing Olympic Games are over and -- depending on your world time zone -- we can once again get a good night's sleep!
READER NOTICE: There will be no The Cargo Letter for Sept. 2008 -- as we attend the FIATA 2008 World Congress ... 23-26 Sept. 2008, at Vancouver, Canada. We look forward to greeting our freight forwarding friends in Canada! See you in October with another edition of The Cargo Letter.
To help you find what you need -- FAST -- there's now a transport search engine installed at our Cargo Law.com website!
Contribute your knowledge, stories & company information.......by e-mail to The Cargo Letter. We strive to bring you useful information which is timely & topical. Be sure to visit our website.The Cargo Letter Archives of Past IssuesMichael S. McDaniel, Editor, Countryman & McDaniel - Trade, Transport Hull & Machinery Attorneys at LAX.
INDEX to The Cargo Letter:
OUR "A" Section: Trade, Financial & Inland News***
1. Freight Forwarder Trade Briefs ______________
2. The Cargo Letter Financial Page ______________
OUR "B" Section: FF World Ocean News***
3. Freight Forwarder World Air Briefs ____________
OUR "C" Section: FF World Ocean News***
4. FF World Ocean Briefs _____________________
5. The Cargo Letter Cargo Damage Dispatches ____
**Back By Popular Demand*
OUR "D" Section: FF in Cyberspace***
6. The Cargo Letter "Cyber Ports of Call" _________
OUR "E" Section: The Forwarder/Broker World***
7. New Transport Related Legal Cases ___________
Back To Main Page
OUR "A" Section: Trade, Financial & Inland News***
1. Freight Forwarder Trade Briefs _______________
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***Will Transport Cost Reverse Globalization? ...... as crude prices have backed off last month's run toward US$150 a barrel. But they persist above US$110 a barrel, a level that was hard to fathom even a year ago. The end of cheap oil heralds a potentially dramatic reshaping of the globalized trade flows that have emerged in the past two decades. Rising transport costs are suddenly a key factor in decisions about both where to place factories and how much inventory to stockpile. For now, the trend seems to favor the U.S. Swedish furniture maker Ikea opened a new plant in Virginia. Midwestern steelmakers are thriving and consumer products giant Procter & Gamble is considering new distribution centers. All, some say, because the cost of moving things from far-away places is beginning to trump the savings involved in using far-away, low-wage workers. "Globalization is reversible," says Jeff Rubin, an analyst at CIBC World Markets in Toronto. If long-term trends push oil prices near US$200, as some analysts expect, sending that shipping container halfway around the world would cost a staggering US$15,000. At such prices, the calculations that drove a doubling in global trade volume since 2000 and the establishment of far-flung supply networks might require rethinking. Orders might be placed with factories closer to home. Shuttered assembly lines could be given new life and, suddenly, the confident claims of globalization's cheerleaders that distance doesn't matter would ring hollow. Morgan Stanley anticipates higher fuel costs eventually reshaping global trade into regional blocs. Instead of relying so heavily on imports from Chinese factories 7,500 miles away, the U.S. will source from Mexico. Western Europe will rely upon suppliers in the former Soviet bloc or Turkey & Asia will orient itself around the ever-larger Chinese economy, expected to be roughly as large as the U.S. economy by 2030, according to a new Carnegie Endowment study.
***Trade Deficit Narrowed ..... as the U.S. narrowed its trade deficit by 4.1% to US$56.8Bn in June from US$59.2Bn in May as growth in exports exceeded import growth, according figures released by the Commerce Dept. on Aug. 12. U.S. exports increased 4% to a record US$164.4Bn, while imports rose 1.8% to US$221.2Bn. The reduction in the trade gap came even as prices for a major import commodity -- oil -- surged. Excluding oil, imports for goods & services declined 1.4% in the face of weak U.S. demand.
***Dragon's Textile Engine Slows ..... as the growth rate of Chinese textile & garment exports has been declining throughout the year as production costs rise and global demand drops, according to a report in the China Daily. "Between Jan. & July, China exported US$100.4Bn worth of textiles & garments, up 7.7%, but well down from the 24.4% growth rate for the same period last year." Effective Aug. 1, 2008, China raised export tax rebates for certain textile goods from 11% to 13%, reported Xinhua News on July 31, 2008. Items receiving the tax rebates include silk, wool, yarn, chemical fiber & cotton products.
***Good Morning Viet Nam! ....... as Dongguan City is the the shoe capital of the world: more footwear is made there than anywhere else on the globe. From 2001 to 2007, the value of footwear exports from its province of Guangdong doubled from US$4.3Bn to US$9.2Bn, according to China's state-run news agency. But in the past year, hundreds of factories have left town, driven out by the rapidly rising cost of doing business in China. The majority go to Vietnam & India. That story is being repeated throughout China's provinces as manufacturers confront sharp price shocks, sparked by stricter environmental & labor controls, higher land & commodity prices, and the Chinese government's moves to curb its trade surplus by reducing the tax incentives that helped the country become the world's low-cost production epicenter. Monthly wages for unskilled labor in Vietnam currently run from US$56 to US$65, while monthly salaries in China's coastal cities can reach US$132.
***The Lawyer Bar Exam Usually Has A Higher Pass Rate ....... as the U.S. Customs & Border Protection's "Customs Broker License Exam" will be held on Monday, Oct. 6, 2008 at various locations throughout the U.S. Applications to take the exam are due on or before Friday, Sept. 5, 2008.
***Dying Duty Drawback ...... as U.S. Customs & Border Protection plans to close its Los Angeles duty drawback center, leaving 4 regional offices to handle a shrinking number of claims. Duty drawback payments are made to parties claiming refunds on import duty payments for goods that are later exported or used in the manufacture of exported articles. The one drawback liquidator in Los Angeles will be reassigned to the San Francisco office. Other drawback centers will remain in New York-New Jersey, Chicago & Houston. For more than a decade, Customs has experienced a decrease in the number of drawback claims and the amount of drawback. The closure is part of a gradual consolidation effort, which last manifested itself in 2003 with the shutdown of drawback centers in Boston, Miami & New Orleans.
***U.S. Customs "First Sale" Requirement ..... as on August 20, 2008, Customs issued Cargo Systems Messaging Service (CSMS) message # 08-000163 outlining the reporting parameters for the "First Sale" declaration. Importers are required to transmit the letter "F" in the Entry Summary transmission when the declared transaction value of imported goods is determined on a First Sale basis. This indicator should also appear next to the declared value on a printed Customs Form 7501. The Farm Bill includes provisions requiring importers to declare "whether the transaction value of the imported merchandise is determined on the basis of the price paid by the buyer in the first or earlier sale occurring prior to introduction of the merchandise into the U.S." There is a 30-day grace period ending Sept. 19, 2008, and beginning Sept. 20, 2008, the data element will be required in all applicable transmissions. "Entries subject to the "First Sale Declaration Requirement" that were not reported between August 20 and Sept. 19, will require amendment." Customs said. Get the full details:
***E-File Your Export License ...... as the U.S. Commerce Department's Bureau of Industry & Security has issued a final rule requiring export & re-export license applications to be filed electronically through the agency's Simplified Network Application Process (SNAP-R) system, effective Oct. 20. See the Aug. 21 Federal Register notice: Currently, exporters submit these applications, requests and notifications to BIS in one of 3 ways: SNAP-R, the Electronic License Application Information Network (ELAIN), or paper BIS Multipurpose Application Form 748-P.
***Weevil Kenivel ....... as U.S. Customs officers at the Port of Los Angeles last month discovered a destructive species of weevil never before seen in the U.S. in a shipment of ceramic tiles from Italy, the agency released Aug. 25. The 3,366 pieces of tile were fumigated & released by Customs & Border Protection to the importer.
***Big Apple Watches It's Tree ...... as New York City is developing a plan to track every vehicle that enters Manhattan to help guard against potential terrorist attacks, the New York Times reported. The proposal, dubbed Operation Sentinel, would rely on various technologies, some of which are still being perfected, and includes photographing and scanning the license plates of cars and trucks at all bridges & tunnels into the city, and using sensors to detect radioactivity, the Times said. Data on each vehicle would be sent to a command center where it would be indexed and stored for at least a month as part of a broad security plan that emphasizes protecting the city's financial district, the paper reported, citing police officials.
***Calling Dynamite By It's Name ..... as Dutch postal & express giant TNT said today it has finished rebranding its India-based domestic road express arm, Speedage, to TNT. Amsterdam-based TNT acquired Speedage in Sept. 2006. Headquartered in Bangalore, TNT India has 3,500 employees, 614 depots, 29 hubs & 1,546 road line-haul vehicles all over India. TNT is rumored to be a possible acquisition candidate for UPS.
***U.S Domestic Yellow Freight Now A China Giant ...... as YRC Worldwide, the trucking & logistics conglomerate based in Overland Park, Kan., said it has completed the 1st phase acquisition of Chinese motor carrier Shanghai Jiayu Logistics Co. Ltd. Shanghai Jiayu extends the reach in China of YRC Logistics to serve domestic Chinese companies & multinational shippers. The subsidiary acquired 65% of Jiayu for US$44.7M and plans to control the remaining 35% in 2010, for an amount based on Jiayu's financial performance not to exceed US$39M Jiayu has more than 30,000 customers,1,800 employees, 200 locations & more than 3,000 vehicles in its truckload and less-than-truckload fleets.
***Spanning The Globe ..... as 3rd-party logistics provider Globe Express Services Ltd. (GES) has expanded to the U.S. West Coast to serve the Pacific region with the opening of a corporate office in Los Angeles. GES Los Angeles opened Aug. 1.
***Navigators Group Heads South ..... as its principal transport related insurance company subsidiary, Navigators Insurance Co., has received regulatory approval to underwrite reinsurance in the newly de-regulated Brazilian reinsurance market. Stan Galanski, CEO of Navigators, commented, "We are very pleased to have received this approval from SUSEP, the Brazilian reinsurance authority. This new license will support Navigators' strategic objective of growing our Latin American book of business by enabling us to better serve the newly-opened Brazilian reinsurance market through both Navigators Insurance Company & our Lloyd's Syndicate 1221."
***"Drive & Deliver" ......... as this new movie from Academy Award-nominated director Brett Morgen explores what it really means to be a long-haul trucker today &endash; tough hours, time away from home, but most importantly: the pride & joy that make up a life on the road. See the trailer.
***U.S. Hydrogen Road Tour ....... as Americans will have a unique opportunity to see what the future holds for hydrogen in the U.S. with the launch of an historic 2-week, cross country trek of a fleet of clean, efficient hydrogen vehicles. Nine auto manufacturers, the U.S. Dept. of Energy, California Fuel Cell Partnership, National Hydrogen Assn. and U.S. DOT are sponsoring the Hydrogen Road Tour to show that hydrogen vehicle & fueling technologies are approaching commercial availability, even as new research & development breakthroughs continue. Six transit agencies across the country currently operate hydrogen-powered buses, Southern California auto dealers are leasing hydrogen vehicles and hundreds of individuals are driving hydrogen-powered vehicles in demonstration programs across the U.S. Hydrogen can be used as a fuel for both a fuel cell vehicle or in a modified internal combustion engine. Starting Aug. 22 -- check the coast to coast tour schedule.
***Genesee & Wyoming Takes Ohio ....... as it has announced that it has signed an agreement to acquire 9 short line railroads known as the Ohio Central Railroad System (OCR), for US$219.0M in cash. In addition, GWI has agreed to pay contingent consideration of approximately US$25M upon satisfaction of certain conditions. Founded in 1988 & headquartered in Coshocton, Ohio, OCR operates 9 short line railroads located in Southern Ohio, in Youngstown, Ohio, and in Pittsburgh, Pennsylvania. OCR operates over 445 miles of track & owns 64 locomotives. The railroads handle approximately 140,000 annual carloads, primarily in the coal, steel & solid waste industries. America's short line railroads -- hauling America's freight -- yet virtually unknown to the public.
***Self Navigation ..... as a blind journalist was given a month's suspended jail sentence & fined US$750 by a French court Aug. 22 for driving while drunk, blind & without a license. The owner of the car, who was also drunk as he sat next to the blind man when he drove the vehicle, was given the same sentence and had his license suspended for 5 months by the court in the northeastern French town of Nancy. The pair were arrested on a country road in the early hours of July 25 by police who spotted their car zig-zagging suspiciously and moving at a very low speed. The police were astounded when the 29-year-old driver informed them that he was blind and when they breathalysed him and his passenger, a 52-year-old photographer, they found they had drunk twice the permitted level of alcohol. "I really wanted to do it (drive the car)," the blind man told the court. "I expressed this wish. He (the owner of the car) agreed." The owner said he saw "a lot of happiness emanating from him" as he drove, adding that he had "one hand on the handbrake and one hand on the steering wheel" as the blind journalist drove. "I was very concentrated on the road," he said. The judge retorted that, as he was well over the legal alcohol limit, "that didn't make you a vey reliable monitor." The blind journalist had previously driven on a closed circuit, an experience which he had recounted in a regional newspaper in an article which was accompanied by his photographer friend who was in court with him. Perhaps this explains the old expression of being "blind drunk." We question the rumor that the journalist has been admitted to the Swiss Air flight school.
***Halt -- Or We Shoot The Monkey...... as morning train commuters in Tokyo were joined on their way to work by an unusual companion Aug. 20: a wild monkey. A security guard spotted the monkey near ticket gates in Shibuya Station. The monkey climbed to a perch, high atop a departure board, and around 30 policemen surrounded the area & attempted to snare it with a variety of nets, as commuters crowded around & snapped pictures with their cell phones. The standoff ended when the monkey climbed down and dashed out of the station, with several policeman and local TV crews in tow. News reports said the monkey was last seen heading in the direction of nearby Yoyogi Park. The animal appeared to be a Japanese monkey, which are native to the country, and was about 27 inches (70 centimeters) long, from head to the tip of the tail. No one was injured & no trains were delayed in the incident. Japanese media have reported several monkey sightings in Tokyo recently, but it was unclear if they involved the same animal. Monkeys have long made appearances in rural parts of Japan, where they have been known to damage crops, swipe food from grocery stalls and even bite humans. In recent years, growth in the monkey population has meant more frequent forays out of the forests and into farms & towns.
2. The Cargo Letter Financial Page ____________
** Cathay Pacific. DOWN losing US$85M in the first half of the year, a 125% drop compared to the US$330M in profits the Hong Kong airline earned in same period of 2007.
** COSCO Pacific. UP with profit of US$153M in the 1st 6 months of the year, 11% more than the US$137.9M recorded in same 2007 period.
**Deutsche Post AG (parent of U.S. parcel carrier DHL Express) DOWN as 2nd-quarter profit fell 11% to about US$396M, or 33 cents a share.
** Expeditors Int'l of Washington Inc. DOWN with 2nd quarter profit of US$71.2M up 9% from US$65.5M in same quarter of 2007.
**Hapag-Lloyd. UP as 2nd quarter underlying earnings before interest, tax and amortization (EBITA) reach US$183M. Revenue from container shipping for the period improved 2.6% to US$2.4Bn.
**MISC Berhad (Malaysia's biggest shipping company) DOWN with aa pre-tax profit of US$172M in it's 1st quarter ended June 30, a drop of 2.6%.
**Neptune Orient Lines. UP with a net profit for the 1st half of 2008 of US$196M, an increase of 45% over the same period in 2007. NOL's core container shipping, APL UP with rise 32% to US$3.94Bn from January through June, and 31% for the 2nd quarter, to US$1.92Bn.
**OOCL. DOWN as 1st half earnings declined 31% from the same period in 2002, to US$158M.
**Pacer International. UP as 2nd-quarter profit rose 10.4% to US$13.8M, or 40 cents a share, from US$12.5M, or 34 cents, a year ago.
**Seaboard Corp.(parent of Seaboard Marine) DOWN with profit of US$21M in the quarter ending June 28, compared to US$42.7M in the same 2007 period.
**Trailer Bridge Inc. DOWN with a 2nd quarter net loss of US$329,000 compared to a net loss of US$1.9M in the same 2007 period, which included a non-recurring tax charge of US$4.6M.
**U.S. Shipping Partners L.P. DOWN with a 2nd quarter net loss of US$2.7 M compared to a profit of US$2.4M in same 2007 period.
**Trimac Group. DOWN as 2nd-quarter net earnings for the Canadian transport firm plunged to C$2.6 million, or 9 cents per unit, from C$7.9 million, or 17 cents, a year ago.
**Wilh. Wilhelmsen ASA (half owner of Wallenius Wilhelmsen) UP with net profit of US$74.2M for the 2nd quarter compared to US$62.4M in the same 2007 period.
OUR "B" Section: FF World Air News***
3. Freight Forwarder World Air Briefs __________
***United Parcel Service New Asia Home .... as the giant is investing US$125M in a new air hub in Shanghai. Dan Brutto, president of UPS' international operations, said the 1 million-square-foot facility, which is scheduled to begin operation in Nov. 2008, will feed global routes. UPS also plans to begin construction of a US$180M intra-Asia hub in Shenzhen by the end of this year, with the opening scheduled for 2010. This will replace a hub currently in the Philippines. Dan Brutto said he expects 40% of UPS' revenue to come from int'l sources by 2010, up from 25%-30% now. UPS has announced plans to buy a logistics firm in China, while downplaying European reports it may bid around US$20Bn U.S. for TNT, the 2nd biggest European mail & logistics group.
***UPS Brings Reality To Alaska ....... as it has opened its newest flight training facility, a 27,000-square-foot center in Anchorage that will reduce the time spent away from home for training by Anchorage-based pilots. Housing two flight simulators, classrooms and offices, the facility is the 2nd such pilot training center in the UPS network and will be in operation 20 hours each day. Established to support all phases of flight training, the new facility will make it unnecessary for Anchorage-based pilots to fly to Louisville for training. The UPS Airlines and its main global Worldport® hub are located in Louisville. The Anchorage Flight Training Facility was built in a converted hangar located at the south end of Ted Stevens Anchorage Int'l Airport. It houses UPS's only 747-400 flight simulator along with its 2nd MD-11 simulator. UPS Airlines is the 9th-largest airline in the world, operating 265 aircraft. UPS air operations encompass more than 1,900 flight segments each day, serving more than 800 airports around the world.
***FAA Slaps AA ...... as the Federal Aviation Administration slapped American Airlines this month with fines totaling US$7.1M for improperly deferring maintenance on safety-related equipment, and problems with its drug & alcohol testing programs, and exit lighting inspections. Several civil penalties relate to instances last Dec. involving several of the Dallas-based carrier's MD-83 aircraft. In one instance, American returned 2 planes to service after pilot complaints without replacing certain parts as required by aviation regulations. American also flew several times after improperly deferring maintenance on an autopilot system and in another case ignored a glitch with an autopilot system. "The FAA believes the large total amount of the fine for these violations is appropriate because American Airlines was aware that appropriate repairs were needed, and instead deferred maintenance. In intentionally continuing to fly the aircraft, the carrier did not follow important safety regulations intended to protect passengers and crew," the agency said. Both cargo & passengers are put at risk.
***United Airlines Kills Cancun & Kansas City ..... as it has terminated cargo service at 2 cities in North America. The Chicago-based carrier announced an immediate embargo on cargo transport to & from Cancun, Mexico. UAL cargo operations have ceased at Kansas City Int'l Airport.
***Good Bye Gemini Air Cargo ...... as it ceased all operations on Aug. 12 after failing to find a buyer to rescue it from bankruptcy, according to a message posted on its Web site. The Dulles, Va.-based full-service aircraft leasing company filed for bankruptcy protection two months ago, unable to cope with soaring fuel prices and reduced demand. Gemini grounded its DC-10 fleet, but continued to operate with 4 leased MD-11 planes as it sought additional investors to support operations. Gemini recovered from bankruptcy 2 years ago when new private investors took majority control of the carrier. More.
***Hello Airgo Airlines ...... as a Greek all-cargo start-up, will commence operations this month from its base in Athens International Airport to serve the Balkan and Southeast Mediterranean markets. Using an 8-ton ATP Freighter aircraft on long-term sub-lease from West Air Sweden -- an aircraft that in turn is on long-term lease from BAE Systems -- Airgo will initially concentrate on ad hoc cargo flights between Greece, the new accession countries of the European Union in the region such as Bulgaria, Cyprus & Romania, and the Balkan states, such as the republics of the former Yugoslavia, Albania and also into Turkey.
***Kingfisher Airlines Goes Inernational .... as the Indian carrier will commence int'l service on Sept. 3. Kingfisher will start operations with a Bangalore to London service using an A330-200.
***New Type For FedEx Fleet ...... as it has introduced the 1st Boeing 757-200 freighter to its fleet & plans to add 11 more of the narrow-body planes in the next year to replace its aging 727s, the overnight carrier said. The 757 has been placed in service on a new route between FedEx's main hub in Memphis, Tenn., & Ronald Reagan Washington National Airport, which primarily serves as a short-haul, domestic airport. This month FedEx launched next-day service in Mexico.
***Qantas Get's The Big Bird ...... as it will take delivery of its first A380 aircraft on Sept. 19, 2008. The airline will welcome its 1st A380 aircraft into the Qantas fleet at a ceremony at Airbus' Toulouse factory and fly it via Singapore to Sydney where it will land on Sunday morning, Sept. 21, 2008. Qantas has ordered 20 A380s
***Doubling The Great Wall ...... as Shanghai-based all cargo airline Great Wall Airlines is doubling its services to the U.S. to 6 weekly flights from Sept. 4. Great Wall, which began operations in 2006, had been operating three times a week from Shanghai to Seattle and Chicago via Seoul since June 1. Great Wall, which is 49% owned by Singapore Airlines Cargo and a subsidiary of the Singapore government's Temasek Holdings, operates a fleet of three 747-400 freighters.
***Meet "ALLEX" ...... as new Japanese All Express Corp. will, probably before Oct., launch an express service to Hong Kong & Shanghai which will almost automatically bring a fighting response from the Chinese carriers. Allex, is a joint venture between All Nippon Airways, which owns 36.4%; Japanese freight forwarders led by Nippon Express & Kintetsu Worldwide Express, owns 30.4% each. The rest is owned by Yusen Air & Sea & MOL Logistics. Allex will change the balance of power for air freight between China & Japan. Expect new joint ventures between Japanese & Chinese forwarders.
***Lufthansa Cargo Again Dedicated To Canada ....... as Sept. 2 it will start a twice-weekly connection between Frankfurt & Toronto, marking the 1st time since 2000 that the German group has served Canada with a dedicated freighter service. The airline will deploy MD-11F freighters for the service, which will have capacity for about 90 tons.
***TAM Linhas Aereas Grows The Amazon ....... as it has inaugurated its largest freight terminal to date, in Manaus, Amazonas, which has an operational area of 2,160 square meters (3 times the size of the former Manaus facility) and 540 square meters of administrative/commercial area.
***Faster Screening ....... as the Transportation Security Administrations has announced an intent to begin accepting "Checkpoint Friendly" laptop bags by August 16, 2008. Transportation Security Officers will accept these bags at security checkpoints provided that the traveler keeps all other articles away from the laptop enclosure. Pathfinder Luggage has heavily tested its bag at the Ontario Airport of World Port LAX, an approved test site, to ensure safe & quick passage of the laptop through the screening process. Pathfinder will begin offering tips to ensure that the traveler's bag is Checkpoint Friendly
***Delta Airlines Takes Back Hartsfield ...... as it has announced it would take back control of cargo handling operations from a contractor at Atlanta-Hartsfield Int'l Airport. The move reflects Delta's increased emphasis on improving cargo operations the past 9 months. Many airlines have outsourced cargo acceptance, delivery and gate operations in an effort to save money. Delta Cargo said it decided to take delivery, pack & load/unload planes itself to upgrade service reliability. Air Serv, a company that provides various services throughout the airport, has been handling cargo for Delta at Hartsfield since 2006
***Volumes >>> Hong Kong Int'l Airport officials said cargo volume grew 0.7% in July, to 317,000 tons, but less than the 2.4% growth seen in June. >>> Hong Kong-based Cathay Pacific Airways & sister airline Dragonair carried a combined 142,770 tons of cargo and mail in July, up 5% over same month last year.
***Did You Wish To Rent A Seatbelt, Sir? ...... as the race by airlines to shave weight & save fuel is now reaching safety equipment. Jazz airlines, Air Canada's regional affiliate, recently removed life vests from all of its planes &endash; including those that fly over water &endash; to reduce fuel consumption & save money. Transport Canada regulations allow carriers that fly within 50 nautical miles of shore to use flotation devices instead of vests. Safety cards in seat pockets will now direct passengers to use the seat cushions, which float. Jazz planes criss-cross Canada and the U.S., flying over the Great Lakes and up the Eastern seaboard from Halifax to Boston & New York. The Jazz decision, which follows surcharges for meals, baggage, pillows and, in the U.S., bottled water, is the latest attempt by airlines to make up for soaring fuel prices, which have almost doubled in recent years. Next, riding in the section with an actual seat will require an additional payment.
OUR "C" Section: FF World Ocean News***
4. FF World Ocean Briefs
***End of Far East Cartels? ...... as Asian shippers may be ready to bring shipping lines to court should operators collectively fix prices in China where a new antitrust law came into force on Aug. 1. Chairman of the Asian Shippers' Councel John Lu said after the councel's annual meeting in Macau this month, they believe the newly enacted antitrust law in China should take precedence over pre-existing Marine Regulations, which allow shipping lines to set rates collectively. However, there is, at the moment, no authoritative answer as to which law prevails and the council hopes the Chinese government will clarify the law & rule the cartel operations among shipping lines illegal. Asia is the world's largest shipping market with the intra-Asia trade making up 50% of the world's cargo flow, Asia-Europe 10% to 15%, and transpacific 20%.
***Black Sea Tension ...... as the U.S. Maritime Administration in a notice urged U.S.-flag vessel operators to exercise extreme caution in the port areas of Georgia, which have been under threat of attack since fighting erupted this month between Georgia & Russia and the separatist forces of South Osettia in northern Georgia. Russian airstrikes inflicted heavy damage at the Poti container terminal while Russians warn of stop & search policy for all Georgia-bound shipping. U.S. Navy destroyer USS McFaul (DDG 74) & U.S. Coast Cutter USCGC Dallas (WHEC 716) entered the Black Sea & called at the Georgian port of Bat'umi -- over objections of the Russian Navy.
***TWIC Begins To Come On Line ...... as the U.S. Coast Guard has begun setting dates when truckers & others who enter ports in ports must have government-issued Transportation Worker Identification Credential, or TWIC, that is meant to prevent terror attacks on the docks. The cards will be required on Dec. 1 at Savannah, Ga., Charleston, S.C. and Jacksonville, Fla., 3 of the largest U.S. ports, the Coast Guard announced. The 1st places where the cards will be required, starting Oct. 15, are ports in Boston & New England, followed by Port Arthur & Corpus Christi, Tex., as well as Cape Fear, N.C. on Nov. 28. The card will be needed in port areas for anyone to have unescorted access.
***Welcome To America ..... as according to Lloyd's, U.S. Coast Guard Guard Commandant, Admiral Thad Allen has pledged that foreign mariners will be treated more courteously & respectfully when they call at U.S. ports. His office is also supporting the establishment of a federal fund to defray costs of sustaining foreign mariners obliged to spend extended periods in the U.S. because of their involvement in investigations involving oil pollution or other alleged offences. A memorandum from Admiral Allen was allegedly circulated in Feb. among USCG sector commanders and subsequently released on the internet. It said: "Unfortunately, I have received reports from highly respected professionals recounting Coast Guard boardings, inspections, and investigations not displaying professionalism.
***NVOCCs Demand Tariff Exemption ...... as the U.S. Federal Maritime Commission has published a request for comments regarding a recent petition asking the agency to use its authority to exempt non-vessel-operating common carriers from the requirement of publishing rate tariffs. The National Customs Brokers and Forwarders Association of America filed the petition with the FMC on July 31. The FMC said comments on the exemption request are due by no later than Sept. 26. For information about filing comments, access online:
***U.S. Throughput Declines ....... as cargo volume at the nation's major retail container ports is expected to decline 4% in 2008 compared with 2007 because of the nation's slow economy, according to the monthly Port Tracker report released Aug. 7 by the National Retail Federation and economic consulting firm Global Insight. Volume is projected to total 15.8 million TEUs for the year, compared with 16.4 million TEUs in 2007. Cargo volume each month this year has been below the same month last year and is expected to continue to be below last year's levels in each remaining month except Oct. & Dec. U.S. ports surveyed handled 1.3 million TEUs in June, the most recent month for which actual numbers are available. The number was down 0.3% from May and 10.3% from June 2007.
***LAX & LBG Feel The Heat ...... as sizable diversions to other ports, in combination with a souring U.S. economy, have eroded cargo volume gains achieved at the Southern California ports over the past 5 years, according to a study released this month. Despite the ports of Long Beach & Los Angeles recording significant gains in exported containers for the past two years, the study found that declines in imported and empty container shipments through the 1st half of 2008 had reduced the two ports' total container volumes to mid-2003 levels. Most likely causes for the diversions are increases in long-haul rail intermodal rates, additional capacity through the Canadian ports of Vancouver and the newly opened Prince Rupert, and shippers opting for Panama/Suez Canal alternatives to the U.S. East & Gulf coasts, the maritime consulting & engineering firm Moffatt & Nichol said. The study found that rail movements of containerized goods from the U.S. West Coast have decreased more than 8.3% through the 1st quarter of 2008 compared to the same period in 2007. Despite the two ports suffering the largest declines of the 4 major U.S. West Coast port complexes, the study found that the Southern California ports retain a better than 70% share of West Coast volumes.
***LAX & LBG Under Fire ...... as the American Trucking Assn. has asked the Federal Maritime Commission to prevent an antitrust waiver agreement allowing the Southern California ports to cooperate on a trucking re-regulation plan from taking affect. ATA has also requested that the FMC subject the truck plan to a "competitive review & analysis" and require the ports to answer previously proffered questions on the truck plan, and detail the "planning and procedures to ensure a supply of drayage trucks & drivers," after the truck plan takes affect Oct. 1. The association, which last month filed a federal lawsuit against the neighboring ports of Long Beach & Los Angeles over a portion of the US$2.4Bn truck plan, submitted the request as part of comments filed with the FMC Aug. 18 over an amended marine terminal operator's discussion agreement the ports filed with the commission on Aug. 1. The ports need the agreement in place to discuss certain key aspects of the truck plan's implementation and with less than 45 days to go before the Oct. 1 start of the truck plan, the ports could seek an expedited FMC review allowing the agreement to take effect much sooner. Meanwhile, the U.S. District Court of Los Angeles has set a Sept. 8 hearing date on ATA's motion for preliminary injunction on the harbor commissions of the ports of Los Angeles & Long Beach, Calif.
***But LAX & LBG Truck Scheme Enrollment Laggs ...... as local drayage fleet enrollments in the Southern California ports' US$2.4 Bn trucking re-regulation plan are lagging with less than 5 weeks to go before the plan's Oct. 1 start date. While officials from the ports of Long Beach & Los Angeles report applications continue to be received, less than 1% of the more than 1,300 local drayage firms serving the two ports had applied by the start of this month. Under the truck plan, motor carriers not signed up for ports-issued access licenses by the plan's Oct. 1 start date will be barred from operating in the ports. In late breaking news, Arizona-based trucking firms Knight Transportation and Swift Transportation have agreed to enter the Southern California drayage market under contract with the Port of Los Angeles. While the number of trucks the two will bring into port service has yet to be determined, port officials estimate that two firms' collective pool will exceed 2,000 trucks.
***Somalia Pirates Take Tanker ...... as a 32,169 dwt chemical tanker belonging to Malaysia's MISC has been hijacked by armed pirates off the coast of Somalia. The 1997-built M/T Bunga Melati Dua, with 39 crew onboard, was carrying a cargo of palm oil from Indonesia for Rotterdam when the vessel was attacked in the Gulf of Aden. MISC confirmed the vessel was taken on Aug. 19. In a statement, the company said: "MISC regrets to inform that its chemical/palm oil tanker, M/T Bunga Melati Dua, has been hijacked by unknown pirates at 1409 GMT on August 19." The crew of 29 Malaysian and 10 Filpino seafarers managed to send a distress signal, but Noel Choong of the Piracy Reporting Center in Kuala Lumpur said there had been no direct contact with the crew. He said an unidentified warship was searching for the tanker which is believed to be heading for Somalia waters. M/V Bunga Melati Dua is the 4th vessel to be hijacked in the area in the past month. The Thai cargo M/V Thor Star and Nigerian tug, M/V Yenegoa Ocean, were seized the week of July 11. The bulker M/V Stella Maris was attacked & hijacked on July 20. M/V Bunga Melati Duais is insured through the UK Mutual Steam Ship Assurance Assn. (Bermuda) & classed by Lloyd's Register. Six pirate gangs are operating in the area says IMB.
***Appeal To The Governator ....... as mirroring recent moves by Hawaii & Alaska officials, a member of Guam's legislature is seeking an exemption to a proposed California statewide container fee for cargo moving headed to the U.S. territory from California. Sen. Jim Espaldon claims that the new California fee, which if signed by California Gov. Arnold Schwarzenegger would impose a US$30-per-TEU fee on all containers moving through the ports of Long Beach, Los Angeles & Oakland, would add close to US$4M a year annually to the cost of goods shipped to Guam. Four members of Hawaii's congressional delegation and 3 members of Alaska's congressional delegation called the fee "a burden of great consequence to our hard-working constituents." The delegations said that if the California container fee is enacted it would cost Hawaiian citizens US$34M a year in additional shipping costs and Alaskans US$1.4M per year.
***Seal of Approval ....... as U.S. Customs & Border Protection (Customs, CBP) has issued a Federal Register notice that all containers inbound to the U.S. must be sealed with a seal meeting Int'l Organization for Standardization Publicly Available Specification 17712 (ISO/PAS 17712) standards. The effective date for this requirement is Oct. 15, 2008. Certain types of containers will be exempt from the rule, including tanks, non-standard containers such as open top containers, & certain custom-built containers. Also in the notice, Customs reminded vessel carriers that they are required to transmit all seal numbers to CBP via the Vessel Automated Manifest System (AMS) 24 hours before cargo is laden aboard a vessel at a foreign port.
***FMC Filed Carrier Agreements Now Online........ as the Federal Maritime Comission now provides public notice of the filing of carrier & marine terminal agreements and amendments to existing carrier & terminal agreements.
***American Cadets At Sea ...... as the U.S. Maritime Administration & Hapag-Lloyd USA have entered an agreement for cadets from the U.S. Merchant Marine Academy and state maritime schools to take their training voyages on Hapag-Lloyd vessels. U.S. maritime cadets must have sailing time on working vessels to qualify as licensed mariners. The agreement with Hapag-Lloyd marks the fifth training agreement reached between MarAd and the private industry. Previous agreements were with APL, Overseas Shipholding Group, Great American Lines & SeaRiver.
***Coda Echoscope On San Francisco Bay ....... is the heart of the Coda Underwater Inspection System being adopted for U.S. Homeland Security in ports around the world and which can be linked to land based surveillance systems utilizing secure wireless communications. Underwater Inspection System (UIS), developed in cooperation with the US Coast Guard, has been purchased by the Sheriff's Office of Contra Costa County, CA. Contra Costa County will be the first on the West Coast to permanently deploy the UIS for patrol of San Francisco Bay.
***Volumes >>> APL shipped 209,800 40-foot containers in the 4 weeks ending July 25, a 14% increase from the year earlier period and the year, APL's volume gained 13% to 1.48 million FEUs with the average revenue per FEU up 14% at US$2,986. >>> U.S.-flag vessels operating on the Great Lakes carried 12 million net tons in July, fractionally less than in the same month last year and for the year, U.S.-flag Great Lakes carriage stands at 51.1 million tons, a slight decrease from both a year ago and the 5-year average for the Jan.-July timeframe.
***Throughput >>> Dutch Port of Amsterdam & its subsidiary ports achieved a 6.6% rise in cargo throughput for the 1st half of 2008 totaling 47.6 million tons -- and container volume after 6 months improved 19.4% to 209,928 TEUs. >>> The ports of Bremen and Bremerhaven reported an increase in cargo volume for the 1st half of 2008 compared to the same period of 2007 ad the the year, the ports they handled 2.7 million TEU, 15.9% more than the same period last year. The ports also handled 1.09 million cars, 9.1% more than in the first half of 2007. >>> The Port of Dunkirk on the French Atlantic coast reported a 9% rise in container traffic for the 1st seven months of the year to 133,000 TEUs as cargo volume for the period was up 1% at 33.8 million tons. >>> Dutch Port of Rotterdam, Europe's busiest port reported half-year cargo throughput of 213.3 million tons, a 7.7% increase from the 1st 6 months of 2007 as general cargo improved 4.4% to 67.6 million tons including containers (up 6.9% at 54.6 million tons) and roll on/roll off cargo (up 2.6% to 8.9 million tons). Containers, measured in equivalent units, were 4% higher at 5.4 million TEUs. >>> Throughput at Hong Kong's ports was up 4.7% in July over the same month in 2007, to a volume of nearly 2.2 million TEUs, continuing a steady pace of roughly 4.5% growth for the year, with volume from January through July at 14.2 million TEUs.
***Decline of A Navy, Despite Tragic Event ....... as the Japanese government will have to pay damages to the parents of a sailor who hanged himself after being repeatedly insulted by his superior, in the 1st such court ruling involving a civil servant. The Fukuoka High Court in southern Japan ordered US$32,000 be paid to the parents of the petty officer 3rd class, a court spokesman said, declining to give further details. Kyodo news agency said the court recognized that the sailor's suicide had been caused by depression, a result of stress accumulated from insults such as: "You are not qualified as a petty officer 3rd class" and "Are you dumb?" The sailor had been 21 when he committed suicide aboard a destroyer in 1999.
***This Month In U.S. Navy History .....
1942 - 120 women, each commissioned directly as an ensign or lieutenant j.g., reported to USS Northampton, Smith College for training.
1991 - Helicopter from USS America (CV 66) rescues 3 civilian sailors who spent 10 days in a lifeboat 80 miles off Capt May, N.J., after their sailboat capsized.
1992 - Navy & Marine forces begin providing disaster relief after Typhoon Omar hit Guam.
1992 - Marines & Army forces begin providing disaster relief in Florida after Hurricane Andrew.
5. The Cargo Letter Cargo Damage Dispatches
**Back By Popular Demand**
We're sorry, but there were so many sinkings, explosions, pirate attacks, fires, cargo mishaps, battles on the water & other disasters at sea that we do not have room to print even the highlights this month. Many people lost their lives at sea this month!! Don't miss the pirate attack on M/V Seabourn Spirit
But you can read all this month's disaster news at our special Internet web feature which provides full details of each event -- our Vessel Casualties & Pirate Activity Database. Bookmark the site and visit every day! Updated twice daily. You will be amazed.
SPECIAL NOTE: Please view the dramatic new pictures at our special "Gallery of Cargo Loss" website feature.
See our new feature for June 2008: "Too Little Runway - Too Much Plane" - TACA Flight 390 - June 2008
You Tube feature: "Container Gantry Gone"
See our newest photo feature "Singles Only" - Transportation Disasters Told In A Single Photo!
NOTE: The historic dangers of carriage by sea continue to be quite real. Shippers must be encouraged to purchase high quality marine cargo insurance from their freight forwarder or customs broker. It's dangerous out there.
OUR "D" Section: FF in Cyberspace***
6. The Cargo Letter "Cyber Ports Of Call"___
Here are our suggested world wide web sites of the week for your business, your information and your amusement..............
Cargo & Trade>>>>>>
Beijing 2008 Travel Guide
Free Reports About Emerging Markets
Hungarian Investment & Trade Development Agency
Maritime Answers .......search engine solely dedicated to the shipping industry
Play RFID Roulette Online
Rules of Navigation For Suez Canal
The Quixotic Quest for Invulnerability ....... new paper on security & terrorism. More
The Year in Trade 2007 ..... operation of the World Trade Organization (WTO) & an overview of U.S. free trade agreements & U.S. bilateral trade relations with major trading partners.
Trade With Sweden
U.S. African Growth and Opportunity Act
U.S. Customs & Border Protection Container Security Initiative Response To Terrorism Video
U.S. Customs & Border Protection Publishes Interim Rules Ror Softwood Lumber Imports
U.S. Customs & Border Protection Quota Book Transmittals
U.S. Customs Mitigation Guidelines: Fines, Penalties, Forfeitures & Liquidated Damages
U.S. Customs Valuation Encyclopedia (1980 - 2003)
U.S. Trade Agreements
OnlineDrayage ....... aimed at improving user operating efficiencies by matching empty containers with over-the-road operators serving local, regional & long-haul trucking markets.
Patented Portable Storage Units
Report: Logistics in Bulgaria
The Essential Guide to Logistics in Hungary
Trade Shows, Exhibitions, Conferences & Business Events Worldwide
World Trade Organization Events
1st Journal of Commerce Container Transport Investment Conference ....... Jan. 14-15, 2008 in New York City
2nd Int'l Railway Symposium ...... 15-17 Oct., Istanbul, Turkey
3rd Annual Canada Maritime Conference ...... Sept. 30&endash; Oct. 1, Vancouver, Canada
4th China Int'l Container & Intermodal Transportation Development Forum ......Sept. 5-6, 2008, Renaissance Tianjin TEDA Hotel & Convention Center,Tianjin, China
7th Annual Maritime Security Expo .........18-19 Nov. 2008, Long Beach Convention Center
9th Annual Global Export Finance Conference .....27&endash; 29 Oct. 2008, Radisson Hotel, Berlin
17th Int'l Congress of Maritime Arbitrators ..... 4-9 Oct. 2008, Hamburg
2008 China Warehousing Annual Conference & Exposition ....... Sept. 23-24 in Beijing
AltCar Expo 2008 ........ Sept. 26 & 27 Sept. 2008, Santa Monica, CA
AltCar Expo 2008 ........ Sept. 16 & 17 Oct. 2008, Austin, Texas
Annual U.S. Customs and Border Protection Trade Symposium ....... 29 &endash; 31 Oct., 2008, JW Marriott, Washington, D.C.
CargoFacts 2008 ...... 15 Sept. 2008, Loews Miami
Expo Logistica Panamá .... 15 & 16 Oct. 2008
FIATA 2008 World Congress .......... 23-26 Sept. 2008, Vancouver, Canada
Int'l Congress of Maritime Arbitrators ......5 - 9 Oct. 2009, Empire Riverside Hotel, Hamburg
Int'l Freight Week ...... 23-25 Nov. 2008, Abu Dhabi National Exhibition Centre
Logistics Expo Panama ........15-16 Oct. 2008, Panama
MARAD Approved Maritime Security Awareness Classes
MarineLog 2008 Global Greenship Conference & Expo ....... 16-17 Sept 2008, Washington, DC
Port & Shi[ Int'l India ....... Oct. 23-25 2008, Mumbai
Structured Trade & Export Finance Ib Africa Conf. .......17 & 18 Sept. 2008, 2008, Johannesburg, South Africa
Transport & Infrastructure India 2008 .............27-29 November 2008, Mumbai, India
U.S. Customs & Border Protection 2008 Trade Symposium .... Oct. 29-31, Washington
10 Worst Laws In China
A2B Electric Bike
American Express Members Project ...... who will win?
Cull: New Search Technology ....... claims to be largest search engine in the world & searches 3 times as many pages as Google.
Demise of The Proud S.S. Norway ..... a tear - no, several
ElectriPlast ....... breakthrough fusing plastic for conductivity of metal with the lightness and malleability of plastic.
Fuel Economy? ........ what does your car get?
History of a Legendary Notebook
Hot For Words
In the Crosshairs with Uncle Jimbo - Atwar Bahjat's Killers
Lost Whale Bonds With Yacht ....... a tragic ending. More
Oil Is Not A Fossil Fuel
Silence Your Rooster!
Use the Right Search Engine
Web 2.0 Travel Tools ........plot, plan & map your trip
OUR "E" Section: The Forwarder/Broker World***
7. New U.S. Transport Related Legal Cases _____
North America Freight Car Ass'n v. Surface Transportation Board
U.S. Court of Appeals For The District of Columbia
June 24, 2008, 529 F.3d 1166
Challenge to BNSF Railcar Storage Charges Loses Steam -- demmurage >>> The North America Freight Car Assn. (NAFCA) is made up of companies that either own or lease their own railroad freight cars, which they use to transport their goods on railroad-owned track. In July of 2001, the BNSF Railway Company began charging "storage" and "demurrage" charges for these privately-owned cars when left empty on BNSF tracks. NAFCA filed a complaint with the Surface Transportation Board ("STB"), alleging that the charges violated several provisions of the Interstate Commerce Commission Termination Act of 1995 ("ICCTA"). When the STB dismissed the complaint, NAFCA filed a petition for review to the U.S. District Court for the District of Columbia.
First, NAFCA alleged that BNSF's charges were not "reasonable practices" as required by ICCTA Section 10702, 49 U.S.C. 10702. As evidence of "unreasonable[ness]," NAFCA posited that the charges violated the four congressional policies set forth in 49 U.S.C. 10101. The Court of Appeals held that the STB conclusion of reasonableness was entitled to particular deference and was supported by the policies, including allowing the market to control railway rates, promoting "sound economic conditions in transportation," "encourag[ing] . . . efficient management of railroads," and levying charges against only those users who generate the costs. The Court of Appeals next rejected the NAFCA challenge to the STB decision on the basis that the charges were unreasonable because they failed to take into consideration that the use of private rail cars and the storage of these cars on BNSF track was necessitated by BNSF's "erratic" service. The Court held that NAFCA failed to show that the railroad was responsible for this variability, that the need for private rail cars was due primarily to an increase in demand, and that shippers were capable of retrieving their cars promptly to avoid the additional charges.
The Court systematically rejected the remainder of NAFCA's bases of "unreasonable[ness]," holding that the time period allowed for storage prior to a charge was not too short, and that the charges were not discriminatory against users of privately-owned cars, were appropriately levied against those who generate the costs of "system fluidity" by keeping empty railcars on the tracks, and resulted in more efficient rail service. NAFCA next argued that the charges violated 49 U.S.C. 10746 in that they did not allow corrections of charges caused by BNSF's erratic service; as noted above, the Court of Appeals held that NAFCA failed to carry its burden of proof that service variance was attributable BNSF. The Court further held that BNSF did not violate 49 U.S.C. 10746 by seeking, with its new charges, to reduce the number of privately-owned cars in use on its tracks, as long as the supply of railcars did not become inadequate.
Finally, the Court of Appeals disagreed with NAFCA that 49 U.S.C. 10745 required that BNSF compensate the users of privately-owned cars for the storage of their idle cars, as that storage was providing no service to BNSF. Accordingly, the Court of Appeals denied NAFCA's petition for review.
Totes-Isotoner Corp. v. United States
U.S. Court of International Trade
3 July 2008
Decision by the Court of Int'l Trade establishes that importers can legally challenge the constitutionality of gender - and age-based import tariffs. Totes-Isotoner, a U.S. importer of men's gloves, challenged the constitutionality of the tariff rate imposed on its imports, claiming that by setting out different tariff rates for certain gloves, the tariff schedule violated its right to equal protection under the law because it discriminated on the basis of gender and/or age. The government asked the court to dismiss Totes' complaint, claiming that the court did not have jurisdiction because the complaint presents a "nonjusticiable political question," and because Totes did not have a sufficient stake in the matter so as to possess standing to bring this equal protection claim. But the court rejected that argument and found Totes had standing to bring its claims. However the case was dismissed on other grounds. The Decision.
Twardowski v. American Airlines, Inc.
U.S. 9th Circuit Court of Appeals
30 July 2008 No. 06-16726
Int' Law / Warsaw Convention Article 17 / Airlines' Obligation to Warn of Medical Risks >> Opinion: Twardowski and multiple other airline passengers (Plaintiffs) sued American Airlines and several other airlines (Airlines), as the Airlines did not warn of the possible danger of a medical condition called Deep Vein Thrombosis (DVT) that can develop on long, int'l flights. Five of the Plaintiffs died from DVT. The district court granted summary judgment for the Airlines, as the Plaintiffs did not prove that developing DVT was an accident under the definition provided by the Warsaw Convention, Article 17. Furthermore, multiple cases held that developing DVT during a flight is not an accident. The Plaintiffs appealed as they claimed that the airlines had a duty to tell of risk because multiple agencies had suggested airlines do this and some airlines had taken preventative steps. The 9th Circuit upheld that under the definition of the Warsaw Convention, Article 17, the liability of the airlines is limited to dangers or risks not caused by a person's own reaction. The 9th Circuit held that a person's own reaction causes DVT and, therefore, the Airlines are not liable. Furthermore, a failure to warn is not an accident. Airlines are able to violate their own policies and there is no duty on behalf of the airlines to warn of DVT. AFFIRMED. Read The Decision.
Aguilera v. Alaska Juris F/V
U.S. 9th Circuit Court of Appeals
4 Aug. 2008, No. 07-35148
Maritime Law / Maintenance & Cure / Subject to Attachment Pursuant to Child Support Order >>> Aguilera was injured while working for the Fishing Company of Alaska (FCA) aboard the F/V Alaska Juris. Consequently, Aguilera began receiving $20 per day in maintenance and cure payments from FCA. FCA, however, began deducting $10 from Aguilera's maintenance & cure payments pursuant to a state of Texas child support order (Order).The district court held that Aguilera's maintenance and cure payments were subject to reduction pursuant to the Order. On appeal, the Ninth Circuit noted that under general principles of maritime law, seamen are entitled to maintenance & cure for injuries incurred in the service of the ship. The Ninth Circuit held that state law, instead of maritime law, governs the issue of whether maintenance and cure payments are subject to attachment under an order. Thus, because Texas law broadly defines the term "resources" to include disability and workers compensation benefits, maintenance and cure payments are subject to reduction under a child support order. Accordingly, the 9th Circuit rejected Aguilera's argument that maintenance & cure payments are an exception to this general rule. AFFIRMED. Read The Decision.
Written from wire stories, the Associated Press, Reuters, Hong Kong Shipping News, Lloyds & other world sources.
The Cargo Letter Correspondents:
Michael S. McDaniel Esq, Editor (Countryman & McDaniel)
Maria Payne (Countryman & McDaniel)
Christoph Whaner, Esq. (Countryman & McDaniel)
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