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HANDLING OF BACKLOGGED CARGO

June 21, 2024

HANDLING OF BACKLOGGED CARGO 

Backlogged goods at seaports continue to increase, putting pressure on customs authorities and service businesses at the ports. 

According to data updated to early February from the Ho Chi Minh City Customs Department, the amount of goods in stock at seaports and airport warehouses increased sharply. Specifically, in the first month of this year alone, the number of containers in existence at Saigon Port Area 2 Customs Branch increased nearly 1% compared to the last month of the year, from 50 containers to 825 containers. The number of backlogged goods was spread across 32,6 product lines, with over 134 tons, which more than doubled the same of December. 

Handling of backlogged cargo

Essentially, cargo may be considered “backlogged” under Vietnamese law if they either (i) were not received within 90 days from the date of arrival, (ii) their owner (which could either be the B/L holder or the seller) has manifestly abandoned it, either by a written declaration or other forms of abandonment, or (iii) they did not come with a B/L and no one came to receive them. In these cases, the backlogged cargo presents an unlikely situation for the carrier. When no one shows up for the cargo, the containers in which they were packed will also be held hostage at the port. These containers are the carrier’s properties, which he wishes to enjoy uninterrupted use for his freights. Instead, they are stuck at port, where demurrage, detention, and storage charges will accrue. Then, because neither the shipper nor the consignee has any interest in showing up for the backlogged cargo, carriers will eventually be the only ones to pick up the tab when they wish to rescue his containers. That ultimately means that the carrier incurs losses through no fault of his own, gets nothing in return except for what is already his and should have been at his disposal had it not been for the abandonment of actors beyond his control, and at the same time get entangled into legal troubles in a foreign jurisdiction. 

Our lawyers at ANHISA have recently advised and assisted in such a case, where the carrier finds his containers stuck at Cat Lai Port along with backlogged cargo because the consignee was already liquidated. With our first-hand involvement, the carrier cooperated closely with Customs and port management and was ultimately able to dispose of the backlogged cargo and retrieve his empty containers with favorable conditions.  

If you seek assistance in preparing for arbitration before the LMAA, please do not hesitate to contact us via:  

 

ANHISA 

Mr. Dang Viet Anh 

Email: anh@anhisa.com 

T: (+84) 28 5416 5873 

M: (+84) 983 467070 

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