Recently, the Israeli shipping company ZIM has been ruled by the United States Federal Maritime Commission (FMC) to have violated the Shipping Act of the United States and has been ordered to compensate Samsung Electronics America (SEA) with approximately $3.7 million.

The dispute began in October 2022 when SEA lodged a complaint with the FMC against ZIM, citing issues such as "unreasonable operations, retaliatory actions, refusal to cooperate, and incorrect billing."

During the investigation by the FMC, both parties submitted over 200,000 pages of documents, with the dispute primarily focusing on claims related to nearly 3,000 containers and thousands of demurrage and detention (D&D) charges between July 2019 and December 2022.

Originally, SEA had requested compensation exceeding $12 million, including $10.8 million for D&D charges and $1.4 million for other costs.

It is worth noting that most of the transportation activities involved occurred before the enactment of the Ocean Shipping Reform Act (OSRA). The act was passed in 2022 to expedite the resolution of such disputes.

ZIM argued that their actions of "cargo detention" on SEA's cargo were due to a backlog of D&D charge disputes, leading to delays in the timely delivery of the cargo. However, FMC did not accept this reasoning.

FMC, however, stated that SEA did not sufficiently prove that ZIM was responsible for all D&D charges under the door-to-door transportation or carrier haulage model.

FMC stated, "SEA failed to provide sufficient evidence to clearly demonstrate which specific D&D charges were caused by ZIM, especially when some charges actually originated from cases where SEA customers failed to pick up their cargo."

Both parties attempted to settle the dispute privately, and the litigation proceedings were suspended from April 18 to August 2, 2024.

Ultimately, after reviewing all the evidence, FMC found ZIM at fault in three allegations and ordered them to pay a total of $3.68 million in compensation.

SEA has filed similar complaints against several shipping companies, including COSCO, OOCL, SM Line, and HMM. The accusations against HMM are the most significant, alleging that they collected approximately 96,000 D&D charges during the transportation process.