WTSA carriers publish service contract checklist for shippers

MEMBER container lines in the Westbound Transpacific Stabilisation Agreement (WTSA) have published a checklist of issues to be considered in service contract negotiations to avoid disputes.

The guidelines are a result of two-year informal discussions between shippers and carriers since the economic downturn 2009-2010 that highlighted issues of bookings, space and equipment availability.

WTSA members focused on seven points: volume commitment, rate stability and predictability, surcharges, fuel surcharges, service, recourse and miscellaneous issues such as contract duration as well as detention and demurrage.

"The checklist is not intended to be a rigid, one-size-fits-all approach to contracting," said WTSA executive administrator Brian Conrad, presenting the guidelines as suggestions in their individual contracting, particularly useful to small and medium-sized shippers that may have smaller contracting or logistics staffs.

"Our research shows that US-Asia shipper base is extremely diverse in commodity characteristics and objectives," Mr Conrad. "As global supply chains become more complex, time-sensitive and price-sensitive, shippers and carriers need contracts that take us beyond simple volume discounts and more fully spell out the obligations of both parties based on real-time sharing of information."

Factors include contract volume, whether forecasting by season, product or lane segment to allow time to reserve equipment; the notion of a band to allow for rate fluctuation during the term of a contract or alternative pricing components.

The problem of introducing new charges in the course of a contract and how such charges would calculated was mentioned, as well as a need to define bunker fuel charges and their method of calculation.

The full checklist will be available within its "Markets" section of its website www.wtsacarriers.org under the heading "Shipper Relations" and will invite comment from the shipping public via the site, said the WTSA statement.

WTSA is a voluntary discussion and research forum of 10 major ocean and intermodal container shipping lines serving the trade from ports and inland points in the US to destinations throughout Asia.
(Source:http://www.schednet.com)