Day / January 5, 2012

by Mike Poverello

Maersk pays US government $32m

Logo of A.P. Moller – Maersk Group

Maersk Line has agreed to pay an out of court settlement of US$31.9 million to the US government to resolve allegations that it submitted false claims for inflated shipping costs incurred during the transport of containerised cargo to support US troops in Afghanistan and Iraq.

The government claimed Maersk was allegedly billing in excess of the contractual rate to maintain the operation of refrigerated containers holding perishable cargo at a terminal in Karachi, Pakistan, and at US military bases in Afghanistan; billing excessive detention charges (or late fees) by failing to account for cargo transit times and a contractual grace period; billing for container delivery delays improperly attributed to the US government; billing for container GPS tracking and security services that were not provided, or only partially provided; and failing to credit the US government for rebates of container storage fees received by Maersk’s subcontractor at a Kuwaiti port.

Tony West, Assistant Attorney General for the Civil Division of the US Department of Justice said: “Our men and women in uniform overseas deserve the highest level of support provided by fair and honest contractors. As the Justice Department’s continuing efforts to fight procurement fraud demonstrate, those who put profits over the welfare of members of our military will pay a hefty price.”

In 2009, APL was fined $26.3 million by the US Department of Justice, and Agility is still fighting a claim for overcharging in 2010.

Makes you wonder – did they declare the correct cargo information on their manifest? I guess it really does not matter since the cargo was destined for Afghanistan and Pakistan in any event. Don’t believe these countries require advance manifest reporting just yet.

Source: ifw-net.com

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The continuous development in international communication media together with the never ending expansion of the global trade arena have impacted both positively and negatively on international contractual dispute resolution. It is common cause that once a dispute has been characterised as of a contractual nature and the lex fori has been established, the next step is to ascertain which law is the lex causa or so called “Proper Law” of the agreement.

This article is focused on the assertion of the proper law of an agreement, after it has been established that the lex fori is South African law, in situations where parties  electronically concluded an agreement and whilst doing so omitted to exercise their autonomy to record the law which they are intent on governing the agreement, alternatively in situations where one cannot establish whether the parties contemplated and tacitly implied that a specific legal system would govern the agreement at the time when their agreement was concluded when the lex fori was already established as South African law. Read the full paper here!

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