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Following is a question by the Hon Kenneth Ting and a reply by the Secretary for Economic Services, Ms Sandra Lee, in the Legislative Council today (July 4):

Question:

It has been reported that as a Korean shipping company encountered debt problems, some container terminal operators in the territory and the Mainland demanded that local consignors pay the relevant fees on behalf of the shipping company before allowing them to collect the cargoes shipped to the terminals concerned by that company, but those fees were much higher than the normal terminal handling charges on shipping companies. In this connection, will the Government inform this Council whether it has assessed how it can assist local consignors in such incidents and prevent the recurrence of similar incidents, with a view to protecting the rights and interests of local consignors?

Reply:

Madam President,

The question raised by the Hon Kenneth Ting involves commercial transactions amongst three parties, namely, a Korean shipping line, the related terminal operators and consignors and concerns commercial arrangements relating to cargo delivery and fee collection. We understand that the issue originated from a Korean shipping line which has applied to the Korean court to go into receivership. The said shipping company has asked the court to freeze its assets and debts while it goes through restructuring. As the case takes place outside Hong Kong, only very limited information is available to us.

What we gather is that the said shipping company failed to pay the terminal handling charge. The three affected terminal operators initially refused to release the containers to the consignors. One of these three operators is a container terminal operator whilst the remaining two are mid-stream operators. Subsequently, these operators released the cargo upon receiving terminal handling charges from the consignors. Terminal handling charges (THC) are fees collected by shipping lines from shippers and consignors. The fees cover the cost of paying the terminals or mid-stream operators for the loading and unloading of containers and other costs related to cargo handling.

Subsequently some consignors alleged that the charges imposed by one of the terminal operators before the release of the containers were substantially higher than the normal THC charged by other terminal operators. But the terminal operators informed us that the amounts which they charged varied among operators and consignors.

The matter at issue mainly involves the commercial arrangements for cargo collection and fees collection among the consignors, shipping company and terminal operator, Government can only obtain information which those concerned are prepared to release to us. We have discussed the case with the Hong Kong Shippers Council (HKSC) on what could be done to help the consignors concerned in this matter. Both the Government and HKSC are of the view that the current issue is principally a commercial matter, the Government cannot offer much assistance. The HKSC has suggested to the consignors to seek legal advice and to consider appropriate action.

Thank you, President.

End/ Wednesday, July 4, 2001

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