The Cargo Letter

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Air & Ocean Logistics - Customs Broker News
31 December 2002

Part 1 of 1

Good Tuesday Morning from our Observation Deck...... overlooking the officially designated "Cargo City" area and....... Runway 25-Right, at Los Angeles International Airport, voted "Best Cargo Airport in North America". Happy New Year! 

World Trade Replace World Terror For 2003. We Have Much of Value To Exchange With One Another in 2003.

SPECIAL NOTE TO FRITZ EMPLOYEES (Now UPS Freight Services, Inc.): We have received address changes from many of you. For the thousands of Fritz employees who have enjoyed The Cargo Letter over the past 8 years, contact us now, before the former "Fritz" addresses are deleted in 2003. Take a moment to e-mail to:

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Contribute your knowledge, stories & company information ........ by e-mail to The Cargo Letter.We strive to bring you useful information which is timely & topical. Be sure to visit our web site ..........

Our corporate sponsor -- Interpool, Inc. -- named again to Forbes "Best 200 Small Companies" List -- for the 2nd consecutive year
! --

Michael S. McDaniel, Editor, Countryman & McDaniel, forwarder/broker attorneys at LAX.

NOTE: The Cargo Letter is designed to be read using a 12 point Geneva font on a standard 6 inch e-mail field.Our TECHNICOLOR edition requires AOL v3.0 or better.


INDEX to The Cargo Letter

OUR "A" Section: Trade, Financial & Inland News
    1. Freight Forwarder Trade Briefs
    2. The Cargo Letter Financial Page

Our "B" Section: FF World Air News
3. Freight Forwarder World Air Briefs

OUR "C" Section: FF World Ocean News
    4. FF World Ocean Briefs
    5. The Cargo Letter Cargo Damage Dispatches

Back By Popular Demand...
OUR "D" Section: FF in Cyberspace

    6. The Cargo Letter "Cyber Ports Of Call"

OUR "E" Section: The Forwarder/Broker World
    7. New U.S. Transport Related Legal Cases


OUR "A" Section: 
Trade, Financial & Inland News

1. Freight Forwarder Trade Briefs               Return to index...

In Biggest Bankruptcy Ever ....... as United Airlines parent UAL Corp. filed for Chapter 11 protection Dec. 9 in the biggest aviation bankruptcy ever after failing to secure government loans needed to pay debt & implement a recovery plan. The company, which lost US$2.1Bn last year and is on course to lose an estimated US$2.5Bn this year, has struggled since the Sept 11 attack on the U.S. drastically cut passenger traffic across the industry. In the past several months, UAL has negotiated tough salary cuts with its unions worth US$5.2Bn over 5.5 half years. United's top 20 unsecured creditors are collectively owed more than US$3.62Bn. About US$3.34Bn comes from bondholders who put up money for the airline's operations & facilities improvements at U.S. airports including San Francisco, Los Angeles, Denver, Miami, New York & Chicago. This is the biggest bankruptcy in airline history. Dow Jones & Co. pulled beleaguered UAL Corp. from the Dow Jones Transportation Average on Dec. 6, replacing it with United Parcel Service Inc.

United For United ........ as flight attendants, represented by the Assn. of Flight Attendants (AFA), AFL-CIO, ratified a contract on Dec. 13 with management that will provide United Airlines with US$412M in cost savings over the next 5.5 years. Over 67% of the eligible UA flight attendants voted, & 87% of those who cast their ballots voted for a revised contract. Approval of the agreement with the flight attendants was a key step in securing labor cost savings as part of United's recovery plan in Chapter 11 bankruptcy. The agreement also puts the airline a step closer to finalizing its application to obtain a US$1.8Bn loan guarantee that the company is seeking from the Air Transportation Stabilization Board (ATSB) to keep it out of a liquidation bankruptcy (Chapter 7). Once that final piece of the plan is in place, it will be up to the ATSB to do its part to stabilize the industry by rightfully approving United's application for a loan guarantee. This will ensure that the company's recovery plan has a chance to work to improve our airline & protect the lives of its 84,000 employees. 

Hong Kong Did Well ....... as external merchandise trade figures for Oct. that show total exports & imports of goods both registered marked increases in value compared to the same month a year earlier. The increases, however, were helped in part by a low base of comparison in Oct. 2001. For Oct. the value of total exports of goods (comprising re-exports & domestic exports) rose by 12.9% over a year earlier to HK$150.5Bn (US$19.299Bn), after a 10.0% year-on-year increase in Sept. Within this total, the value of re-exports increased by 15.7% to HK$139.1Bn in Oct, but the value of domestic exports fell by 12.6% to US$11.5Bn. Concurrently, the value of imports of goods rose by 13.4% over a year earlier to HK$153.4Bn in Oct, after a year-on-year increase of 6.2% in Sept.For the 1st ten months of the year as a whole, the value of total exports of goods rose by 3.2% over the same period in 2001.

China Did Better.......... as during the first 10 months of this year, China's foreign trade increased 19.7% year-on-year to US$500.261Bn, exports rose 20.6% to US$262.499Bn, while it recorded imports worth US$237.762Bn, an increase of 18.7%, according to the country's Customs' statistics. Meanwhile, China had a trade surplus over the Jan. to Oct. period, which amounted to US$24.737Bn, a rise of 43.3% on an comparable basis. Air freight imports from China to the U.S. increased 43% in the 1st 10 months of this year.  The U.S. economy, driven by consumer spending, grew at a 4% between July &Sept., according to the U.S. Commerce Dept.

UK Protection & Indemnity Club Did Worse -- By Lawyers ........ as the world's largest P&I mutual of shipowners, will introduce measures to raise efficiency in the way claims are handled over the next few months. The Club said that the measures aim to get value for money from lawyers & other consultants such as assessors. Fees paid to external suppliers of professional & consultancy services such as lawyers & technical consultants in respect of member claims account for US$63M to US$68M a year and represent the club's largest expense after claims settlements. A P&I Club spokesman said that he believes that lawyers, other experts & club members & managers "all need to improve their approaches" to claims processing. We agree.

Lloyd's Pushes Ahead ....... as it has defied insurance pessimists by announcing market capacity of £14.25bn (US$22.37Bn) for 2003 - the biggest in the marketís 315 year history.

Russia Presses For WTO ........ as CWTO Members and Russia have agreed on a new, accelerated schedule for Russiaís WTO accession negotiations. A number of meetings will be held during 1st quarter of 2003, prompting some observers to speculate on whether Russia might become a member by the Ministeria Conference to be held in Cancun, Mexico in Sept. 2003. Russian finance minister Aleksei Kudrin's participation in the WTO working party on the accession of Russia, which met from 16-18 Dec, indicated that Russia's seriousness about accelerating the negotiations. The main stumbling blocks on the way relate to agriculture & services, & to the requisite termination of more than 50 bilateral trading agreements with current WTO Members.

Feeling Warm For Chile ........ as the United States & Chile reached a free-trade agreement on Dec. 11. According to the U.S. Chamber of Commerce, trade between the U.S. & Chile reached US$6.6Bn in 2001. Chile is the 6th-largest market for U.S. exports to Latin America & the U.S. is the largest export market for Chilean products. The agreement will be submitted to Congress for approval next year.

Asia Forwarders Gather ........ As the 12th ASEAN Federation of Forwarders Associations (AFFA) general meeting was held on Dec. 15-17 in Singapore. AFFA chairm
Stanley Lim who gave the opening address, spoke of various challenges that members of his organization faced, including a new regulation put forward by U.S. Customs that requires manifests to be filed electronically 24 hours before cargo departs for the U.S. Mr. Lim acknowledged growing competition from China. "In recent years, we have witnessed the opening up of the Chinese market which has tremendous potential in terms of trade opportunities for the world. This has been further accelerated with the country's entry into the World Trade Organization. "There is no doubt our businesses will be very much challenged by this impending competition. As a regional group, we all should look at China not as a threat, but rather as a window for greater business opportunities," Mr. Lim said.

Singing Rails ........ as North America's major railroads reported significant increases in intermodal traffic for the one-week & 50-week periods ended Dec. 14, while reporting marginal to no increase in carload freight. The Washington-based Assn. of American Railroads reported a 12.3% increase in intermodal traffic, as compared to the same week last year, with total loadings of 197,477 trailers & containers. Container traffic was up 16.2% from same week last year, while trailer volume gained 3.4%. Carload freight was up in the U.S. by 1% from last year, totaling 341,028 cars. Broken down, carload volume was up 2.6% in the West, but down 1.1% in the East. Total volume was estimated at 29.5 billion ton-miles, up 1% over the same week in 2001. AAR also reported year-to-date totals for U.S. railroads for the 1st 50 weeks of 2002. Intermodal volume was up 4.4%, to 9 million trailers & containers. Carload freight was down 0.8% from last year, amounting to 16.6 million carloads. Total volume was an estimated 1.4 trillion ton miles, up 0.4% from last year. Combined U.S. & Canadian volume for the 1st 50 weeks of 2002 on 16 reporting U.S. & Canadian railroads totaled 19.6 million carloads, down 1.1% from last year, and 11 million trailers & containers, up 5.6% from last year.

74 Year Job......... as Russian officials have celebrated the full electrification of the legendary Trans-Siberian railroad line, the world's longest track at 5,758-miles. The Far Eastern section of the line runs 4,660 miles & carries more than 30% of all Russian exports. Officials said they hoped the electrification would boost traffic on the Trans-Siberian railway by up to 40%. It took 74 years to finish installing the equipment that allows electricity-powered trains to run along the entire line, from Moscow to the Far East. The last, 109-mile section was finished this month.

Brown Is Green .........
as United Parcel Service, the world's largest global transportation company, has introduced 10 class 8 tractor vehicles, which will be using liquefied natural gas (LNG) as an alternative fuel source, to its west coast fleet on its California to Nevada route. Because of its density, LNG is a viable alternative fuel source for large trucks that need to go long distances before stopping to refuel. Each day, the 10 LNG tractors will each haul two 28-foot-long trailers on the 545-mile trip between Ontario, CA. & Las Vegas. These vehicles will haul more than 31,000 packages a day. The company said it was working with several engine manufacturers to test viable options approved by the Society of Automotive Engineers. Preliminary data shows the new LNG tractors - while substantially more expensive -- address 4 concerns: providing ample power to tractors hauling over-the-road trailers while still significantly reducing emissions, maintenance & operating costs.

Old Dominion Freight Line Cuts The Wire ......... as the less-than-truckload (LTL) motor carrier has adopted handheld computers & scanning technology. Once the province of giants such as FedEx & UPS, modern technology has hit the men streets. More than 1,700 Old Dominion Freight Line drivers are being equipped with Symbol PDT 7500 handheld computers, which will be used throughout each driver's pickup & delivery route. The Symbol computer, which can withstand extreme weather conditions as well as rough handling, allows the driver to collect & communicate -- through wireless wide area network communications -- to manage route & customer orders no matter where the driver may be.

New Schenker Hub ....... as it has a new US$8.63M logistics center into operation in Schweinfurt, Bavaria. The German company reported the new logistics center is situated on a 27,000 square metro site. The centerpiece of the facility is a multifunctional hall that has a transshipment area measuring 5,000 square metros. It also contains a 300-meter long conveyor system with 150 tons worth of traction power that can feed up to 100 trucks, & links 71 docking bays. Schenker has also just opened a branch office in Catania, Sicily.

Phoenix Int'l Expands Inland China ..... as it has opened an office in Doumen, China, to provide Int'l logistics services primarily to Flextronics Corp. Flextronics opened an operation in Doumen earlier this year to manufacture & assemble Microsoft's Xbox. Doumen is located in the Guangdong Province near the Pearl River.

E-Shippers ........ as Log-Net, Inc., a provider of solutions for supply chain execution, has formed a trade group called "Shippers for International Electronic Logistics Data" (SHIELD) to promote E-Commerce best practices that will support expedited trade practices through automation. SHIELD's mission includes educating organizations regarding the need to communicate to their carriers to accept shipping instructions via formats such as electronic data interchange.

Univ. of Miami Hits The Road ........ as it has announced establishment of the "M. Anthony Burns Center for Advanced Supply Chain Management," a new logistics research facility that is the result of a collaboration between the University, Ryder System, Inc., & IBM. Burns, the center's namesake, is a former Ryder chairman who retired earlier this year.The inaugural seminar will be held Jan. 22-24, 2003, at a conference center in the Biltmore Hotel in Coral Gables, Fla.

Goodbye To An Old Friend ......... as Mr. Jay P. Sorci was honored by family & friends at a memorial service at the Salerno-Rosedale Chapel in Roselle, IL. Jay passed away on Dec. 13. Recently retired from a distinguished career with XL Specialty Insurance Co. (formerly Intercargo Iinsurance Co.), this unique man is best described by his wife: "Jay was truly a smart man -- and always so generous with his time & talents. He shared the secrets behind magic tricks, taught us how to trade stock options, explained insurance products in a way that always made sense and brought the history of World War ll to life." Jay will be missed by so may of us -- all whose lives he made just a little more colorful each day. Jay was a true professional & a lightning rod for our transport insurance industry.

2. The Cargo Letter Financial Page               Return to index...

Air India. UP with a net profit of Rs 154.4M (US$3.21M) during 2001/02, after emerging out of a loss of Rs 444M in the previous fiscal year, and their losses the previous 5 years.

FedExCorp. FLAT with net income of US$245M, or 81 cents per share, for the quarter ended Nov. 30, unchanged from the same quarter a year ago.

P&O Nedlloyd.
DOWN pretax loss of US$67M for the 3rd quarter of 2002

Thai Airways Int'l.
UP as net profit over the 2001/2002 financial year has risen 427.84% compared to the same period last year to THB10.182Bn (US$237.054M).

Interpool, Inc. Dividend ........ as it will pay a cash dividend of US$.0625 cents per share for 4th quarter of 2002 (NYSE: IPX). The dividend will be payable on Jan. 15, 2003 to shareholders of record on Jan. 2, 2003. The aggregate amount of the dividend is expected to be approximately US$1.7M. The amount of the quarterly dividend is based on an indicated annualized dividend rate of 25 cents per share. Interpool is one of the world's leading suppliers of equipment & services to the transportation industry. It is the world's largest lessor of intermodal container chassis & a world-leading lessor of cargo containers used in international trade. Interpool operates from over 240 locations throughout the world & is corporate sponsor of The Cargo Letter archives.

OUR "B" Section: 
Freight-Forwarder World Air News

3. Freight Forwarder World Air Briefs     
          Return to index...

Descent Continues ....... as around the world, more than 200,000 airline jobs were lost between Sept. 2001 & Oct. 2002. A further 15,000 job cuts were announced by U.S. & European airlines in Nov. 2002. In addition, at least 80,000 aircraft manufacturing jobs have been lost & Boeing has announced that it would cut 5,000 jobs next year. The IATA membership of airlines, which includes most of the world's commercial airlines, collectively lost over US$12Bn in 2001 and they are forecast to lose a further US$5Bn in 2002.

Some Volume Help ........ as the world's airline industry reported a "modest" 4% increase in scheduled freight volumes in 2002. Freight carried internationally on scheduled airline services was about 30 million tons. The Int'l Civil Aviation Organization said air cargo is "usually a lead indicator of air traffic and the economy in general." However, the airline industry remains in bad shape. Combined passenger &cargo traffic this year is 2% to 3% below 2000 levels. Combined passenger & cargo traffic for 2002 was only about 2% over 2001 levels. 

U.S. Lines Up ....... as according to the Air Transport Assn. - Monthly Cargo Traffic Report,in Nov. 2002 U.S. airlines transported 1,975,496 tons of air cargo % express goods, 14.1% more than in Nov. 2001 -- year 2002 to date, growth was 3.3%. ATA is measures traffic of Alaska, Aloha, America West, American (incl. TWA), ATA, Continental (incl. Micronesia), Delta, Emery, FedEx, Hawaiian, JetBlue, Midwest Express, Northwest, Southwest, United, UPS, & US Airways.

Safey In Numbers ...... as airlines seek new combinations to deal with post Sept. 2001 conditions.
Delta, Northwest & Continental are seeking DOT approval for a codesharing & marketing alliance. The agreement does not involve a merger or consolidation, and there will be no pooling or sharing of revenues. A participating carrier will only earn revenue from cargo or passengers flying on its own airplanes.
United Airlines & US Airways are seeking approval for a similar alliance. United has filed for Chapter 11 bankruptcy.
Alitalia & Air France have announced an exchange of equity.
KLM & Air France are in discussions about an exchange of equity.

Qantas Airways & Air New Zealand Are Next ....... as they have agreed to enter into a wide-ranging strategic alliance. The alliance will involve Qantas taking a 22.5% cornerstone shareholding in Air New Zealand. Qantas CEO Geoff Dixon said the strategic partnership would assist both airlines to retain their independence in an industry facing considerable & continuing difficulties. The strategic alliance agreement is subject to the approval of the New Zealand Minister of Transport (in his role as Kiwi Shareholder), Air New Zealand shareholders, the New Zealand Commerce Commission and the Australian Competition & Consumer Commission.Qantas & Air New Zealand will form a group, made up of an equal number of representatives from each airline, that will coordinate the entire Air New Zealand domestic & Int'l network and Qantas flights to, from & within New Zealand. The lines will codeshare on all New Zealand domestic & trans-Tasman flights and on flights between New Zealand & the Americas --- also codesharing on Qantas Australian domestic flights & Qantas Int'l flights that connect with Air New Zealand flights. Qantas & Air New Zealand together make up less than 4% of the world aviation market.

Alitalia Swaggers Forward ....... as an arbitration tribunal deciding the legal dispute between KLM & Alitalia, concerning the termination of their alliance agreements on April 28, 2000, issued awards to both parties in recent days. The tribunal concluded that KLM's termination of its alliance agreements with Alitalia was not valid. The arbitrators then granted Alitalia's claim for damages to the sum of EUR250M (US$252M) plus interest, but have dismissed Alitalia's additional EUR43 million claim, KLM said in a statement. Meanwhile, the tribunal granted KLM's claim that Alitalia should repay EUR100M plus interest that KLM paid Alitalia in December 1999, as a contribution to development costs for Malpensa Airport, near Milan. On balance, this results in an obligation for KLM to pay Alitalia EUR150M plus interest & costs. An evident true genius at the Dutch airline stated that payment of the claim will have a negative impact on KLM's current cash position. We ponder.

US Airways Staggers Forward ........ as it has filed its "Disclosure Statement & Plan of Reorganization" with the U.S. Bankruptcy Court for the Eastern District of Virginia, keeping the company's voluntary Chapter 11 reorganization on schedule. But the company must secure final approval of the federal guarantee from the Air Transportation Stabilization Board (ATSB) for a US$1Bn loan, to be used as exit financing upon emergence and close its investment agreement with Retirement Systems of Alabama (RSA), the airline's Debtor-in-Possession (DIP) lender & its proposed equity sponsor. RSA will invest US$240M upon emergence.

Air France Goes Private ....... as the French government has confirmed plans to sell off 30% to 40% of the national carrier, but not quite yet. Privatizing the airline, includes the process of turning 70,000 employees from public sector to private sector workers.

UPS Hits Peak Day ....... as on Thurs., Dec. 19
UPS moved more than 18 million packages to their destinations ...... the "peak" day of the Christmas shipping season. That's the equivalent of one package for every American child under the age of 5. It's about 210 packages delivered every second, & more than a 35% surge above UPS's average volume of 13.6 million packages a day.  UPS launched a Short Message Service (SMS) Tracking Service in nine Asian countries to help customers track package deliveries via mobile telephone.

FedEx Hits Back At Lawsuit ........ as it faces accusations of rampant racial discrimination in a lawsuit filed Thursday by 26 current & former California employees who say they are on a crusade for the company's entire minority work force. The Alameda County Superior Court suit could turn into a landmark case that would send a strong anti-discrimination message throughout corporate America, according to attorneys who filed the 189-page complaint. The lawyers hope to convert the suit to a federal class action that represents thousands of FedEx's minority workers nationwide.Memphis, Tenn.-based FedEx denied the allegations. About 40% of the company's 117,000 workers nationwide are minorities, according to FedEx. The Dec. 12 suit alleges most of them are stuck in low-paying, grueling jobs.

Best Asia Forwarder ......... as Danzas Group, the logistics arm of Deutsche Post World Net, was named Best Air Freight Forwarder at the inaugural Asia Logistics Awards gala ceremony held at the end of Nov. in Hong Kong. The award was based on votes cast by readers of supply chain management publication Lloyd's Freight Transport Buyer Asia, published by Lloyd's List, as well as the Asia-based readers of Containerization Int'l, & Int'l Freighting Weekly.

Target Logistics Services In The Heartland ........ as it has bought Cassady Air Transportation of Columbus, Ohio, a freight forwarder & logistics provider. Terms of the acquisition were not disclosed. Cassady was formerly an independent contractor in the USF Seko forwarding organization. Cassady's 40,000-square-foot Columbus facility is "being linked to Target's extensive network of domestic and international offices via an advanced IT system providing almost instantaneous tracking and retrieval information," said Chris Coppersmith, president & CEO of Target.

Christmas Present For Boeing ......... as Taiwan's China Airlines Ltd. has placed the year's largest order for Boeing jumbo jets, agreeing to buy 10 747-400s worth a total of $2 billion at list prices, Boeing Commercial Airplanes confirmed Tuesday. China Airlines also placed orders with Europe's Airbus for 12 airplanes & took options for six more. Boeing's largest order in 2002, a dismal year for the airline industry, came in Jan. from Ryanair, the Irish-based budget carrier. It ordered 100 737-800 aircraft & took options on 50 more. The list price was US$9.1Bn, but Ryanair said Boeing's offer was "exceptionally competitive." For all of 2002, Boeing said it has received 221 new orders, with 47 orders canceled, converted or otherwise changed, for a net of 174. That compares with 328 orders in 2001 & 605 in 2000.

Airbus Will Continue Big ........ as the European consortium stands by its strategy to launch its A380 superjumbo -- 3 deck -- airliner which "is going very well" despite a decision by Boeing on Dec. 20 to abandon its proposed "Sonic Cruiser."

Panalpina Sprouts Wings ...... as the forwarder has acquired 12.1% of the share capital of the Luxembourg airline - Luxair, which operates a fleet of 16 planes & ha an annual freight capacity of 750,000 tons. Negotiations between Luxair's major shareholders & Panalpina were successfully concluded on Nov. 29, the Swiss logistics company said. Panalpina will then also be represented on Luxair's board of directors. Luxair's other shareholders include the state of Luxembourg, 3 banks - Banque et Caisse d'Epargne de l'Etat, Dexia-BIL and Banque Gnrale du Luxembourg - and Lufthansa.

Hong Kong Int'l Airport's Banner Month ........... as it handled its highest monthly amount of cargo ever in Nov. at 253,000 tons, which was 24.1% higher than in the same month last year as well as 18.8% more than the 213,000 tons it processed in Nov. 2000. Exported or loaded cargo handled at Chep Lap Kok last month grew 27.3% versus Nov. 2001 to 161,000 tons as demand from North America grew 49% in large part due to the labor strike (lockout) at the U.S. west coast ports.

More ORD ........ as Mayor Richard Daley has submitted a US$6.6Bn expansion plan for O'Hare Airport to federal review. The plans submitted to the FAA include a rearrangement of the runways to reduce delays, construction of an additional terminal, & the building of a new link to the area's commuter rail service. FAA has begun an environmental study of the expansion & is expected to review the plan for more than a year. Daley predicted the expansion would create 195,000 jobs, partly by boosting the efficiency of air cargo from Chicago.

Getting A Lift ......... as Universal Express, Inc., an air courier and logistics company based in Boca Raton, Fla. intends to acquire CargoLifter AG, the troubled German company that aims to develop large airships to carry heavy cargo. Universal says it signed a letter of intent to acquire assets of CargoLifter out of re-organization in Germany. The company said that it believes that there is a place in the future of air travel to incorporate the high-speed cargo lighter-than-air dirigibles constructed in Germany. CargoLifter owns a large hangar and production facilities on 500 acres in Brand, 42 miles SE of Berlin. Founded in 1996, CargoLifter was set up to develop, construct, operate & market large airships for the worldwide transportation of large & heavy goods. The company has been working on the development of helium-filled 260-meter-long airships, and filed for bankruptcy in June.

Polar Pineapple ....... as Polar Air Cargo has commenced a new scheduled airfreight service between Los Angeles & Honolulu, Hawaii -- 5 days per week. The cargo will consist primarily of U.S. Postal Service mail & perishable products.

Battle of The Borscht ....... as a hunger strike by Russian civilian air traffic controllers spread Dec. 23, shutting down a major airport in Siberia. The strike has affected dozens of airports nationwide. The strikers, who go to a waiting area after their shifts & remain there refusing to eat, are demanding a 30% pay raise and dismissal of state air traffic officials.Moscow's & St. Petersburg's airports are thus far unaffected by the strike. But in Omsk, 1,400 miles E. of Moscow where the protest began Sunday, officials closed the airport because of the controllers' health. Controllers who go without food for more than a few days would have to be taken off the job because they would be too weak to function. The Transport Ministry said it would evaluate how meeting the 30% pay increase would affect the budget. Previously, the government agreed to raise salaries by 15.2%, but the controllers rejected the offer. Controllers make an average wage of US$427 a month.

Meet RACCA ........ as the Regional Air Cargo Carriers Assn. (RACCA) was formed in Aug. 2002 as a not-for-profit trade association. The focus of RACCA is to act as an advocate for an industry that often serves as the 1st or last link in the shipment of air cargo to rural America. RACCA members consist of airlines that deliver small packages, mail, critical pharmaceuticals, & Federal Reserve funds in a time sensitive manner across the U.S. Every day some 800 regional cargo aircraft are in operation helping to keep rural America business & industry in the mainstream of activity.Membership at RACCA is currently at 26 airlines, with 15 associate and 1 affiliate member. 

KLM Royal Dutch Airlines Is More Blue ....... as it will modernize the livery of its entire fleet during the next few years. KLM's familiar bright blue is unchanged, but will now cover a larger portion of the aircraft. The dark-blue strip below, running from nose to tail, has been made much thinner, and the white strip below that has been dropped entirely. Because the bright-blue section is now bigger, the KLM logo has been enlarged.

OUR "C" Section: 
Freight Forwarder World Ocean News

4. Freight Forwarder World Ocean Briefs     
          Return to index...

Upstaged EC May Disrupt Container Security Initiative ......... as U.S. Customs Commissioner Robert C. Bonner defended the implementation of a container security program spreading across Europe's major seaports. The agency's Container Security Initiative (CSI) has come under fire with the European Commission's decision to start infringement proceedings against 4 member states that signed agreements to participate in the program. U.S. Customs implemented CSI earlier this year to help protect the U.S. & a large portion of the global trading system from terrorists who might use container transport to hide weapons of mass destruction. CSI requires bilateral agreements with other governments to target & pre-screen high-risk containers in overseas seaports before they are shipped to the U.S. Customs inspectors will also be stationed in CSI ports to work with their overseas counterparts. The CSI concept has been endorsed by the World Customs Organization & the Group of Eight nations. A handful of European countries, including Belgium, the Netherlands, France, Germany, Italy & the UK, have either signed agreements or announced their intentions to participate in the program. These bilateral CSI agreements have been viewed by some government officials as undermining the authority of the European Commission."There is no evidence, however, that CSI has caused any trade distortions," Bonner said. "Nonetheless, to address the concern of the EC, U.S. Customs is expanding CSI to all European ports that ship significant numbers of containers to the U.S. by implementing CSI at 11 additional European ports."

The U.S. government's new Transportation Security Agency ... now screens the shoes of millions of airline passengers but less than 2% of the 21,000 shipping containers that arrive in U.S. ports every day. The Saints protect us!

Hong Kong Shippers Vs. U.S. Customs Over 24 Hour Rule ........ as the head of Maersk's Hong Kong unit has bashed local shippers over their sloppy manifests & said their failure to change their ways in the run up to the full imposition of U.S. Customs' 24-hour rule in less than 6 weeks time could have an adverse effect on the Hong Kong's economy. Claus Hemmingsen, managing director of Maersk Hong Kong Ltd, said he believes that failure to comply with the new regulations, which require shippers to send electronic manifests with 14 points of information including far more detailed description of U.S.-bound cargo than previously required, could also result in disaster for the Hong Kong shipping industry. "The number of amendments of the cargo details after vessel departure has exploded, & there is a significant risk that cargo will not reach the shores of the U.S. after Feb. 2 if the malpractice is not stopped immediately," Mr. Hemmingsen said. The executive added significant penalties for amendments might be needed to help ensure that the quality of data companies like his received from shippers was up to minimum standard. "The risk of serious rejection of cargo in Hong Kong is real & if customers are not using the 60 days grace period to comply, we could have a very dramatic situation in Feb,.," said Mr. Hemmingsen. "...had this been week six of 2003, only 10% of the North America shipments would have loaded from Hong Kong. This could potentially be a disaster," he added.  For more info on the
new "24 Hour Rule"
see The Cargo Letter [383] for Nov. 2002.

What's Not In There? ........ as U.S. Customs will soon begin testing vessel operators' ability to electronically report empty containers 48 hours prior to arrival in the first U.S. port. Starting June 2, vessel operators will transmit their empty containers through the agency's Vessel Automated Manifest System Empty Container Module. The list must reflect the overseas loading port for each empty container. After the initial report filed through the system, vessel operators continuing coastwise along the U.S. must report containers remaining on board 24 hours after arrival in the 1st port of arrival. At least two hours before the vessel's estimated time of arrival in each subsequent U.S. port, new empty container lists must be sent to the agency. Before leaving the final U.S. port, vessel operators are required to transmit final updated empty container lists to U.S. Customs. This will give the agency a total picture of which empty containers were off-loaded & loaded during the vessel's time in the U.S. Since 1997, U.S. Customs has required vessel operators to transmit empty container lists by ports of discharge through AMS or on paper Customs Form 1302 cargo declarations. Regulators fear that terrorist organizations may attempt to use containers to smuggle weapons of mass destruction into the U.S. Effective Dec. 2, the agency requires all loaded containers to be reported by the carriers & NVOCCs 24 hours prior to loading on ships overseas.

Coming Together....... as the European Union has signed the 1st EU-wide maritime agreement with China. The agreement, concluded for an initial period of 5 years, replaces existing bilateral agreements concluded by individual EU member states with China. The EU-China agreement is based on the principles of freedom to provide maritime transport services, free access to cargoes and cross-trades, unrestricted access to & non-discriminatory treatment in the use of ports and auxiliary services, as well as on the principle of commercial presence. The European Commission said the agreement "substantially improves" the quality of the EU-China maritime relations, by placing the existing bilateral agreements concluded by EU member states in a common European framework. This means the agreement reaches a higher level of market opening than achieved up to now on a bilateral basis. The agreement also covers "all aspects of door-to-door services & also the movement of equipment," such as empty containers. The EU & China are major participants in the global maritime market, controlling nearly 40% of the world shipping fleet. In the U.S., maritime relations with China continue to be tense, following disagreements on policy. The U.S./China bilateral maritime agreement expired in 1998.

Up, But Down ........... as the global merchant fleet expanded 2.1% to 825 million deadweight tons (dwt) at the end of 2001, contrasting with the 1% decline in world seaborne trade. The global containership fleet rose by 11.4% in 2001 to 77.1 million dwt, just over 9% of the overall world fleet.

Best Line ........ as Maersk Sealand has been named "Shipping Line of the Year" at the inaugural Asia Logistics Awards 2002. "Part of the AP Moller Group, Maersk Sealand is the largest liner shipping company in the world. The Danish-based shipping line has more than 250 container vessels and 800,000 containers.Winners were selected by the readers of Lloyd's Freight Transport Buyer Asia, Containerization International and International Freight Weekly. Readers were asked to vote for the individuals & companies which they believe had added most to achieving excellence and setting industry standards in their individual fields of expertise in the past 12 months.

Will Not Run For Re-Election ....... as German-based Senator Lines is terminating all its container services to & from the U.S., including in the high-volume transpacific & transatlantic trades, and shutting down its U.S. regional organization. Closure of the entire U.S. office & organization network in the U.S. involves the elimination of about 200 jobs. However, some former employees of Senator in North America have taken new jobs with Hanjin Shipping, the majority owner of Senator. Senator will stop being a global carrier & become a specialized carrier that is focusing the business on its real strong trades between Europe, the Mediterranean, the Middle East, Asia & Canada. Withdrawal from the U.S. market after a presence of about 14 years will reduce the global traffic of Senator by an estimated 30%. In 2001, Senator carried 343,000 TEUs to & from the U.S., out of a worldwide traffic of 1 million TEUs. Hanjin, Senator's majority shareholder, will continue to be active in the U.S. Senator said that it will strengthen the "synergy effects" of cooperation with Hanjin in the fields of equipment, logistics & marine operations will be strengthened. Worldwide, Senator will now employ 450 staff, down from a peak of 952 in 2000.

Safer Box ........ as U.S. Customs & the Dept. of Transportation have jointly announced the launch of Operation Safe Commerce (OSC), a program to fund business initiatives designed to enhance security for container cargo moving throughout the Int'l transportation system. OSC will, a spokesperson said, "provide a test-bed for new security techniques that have the potential to increase the security of container shipments." DOT & Customs will use the program to identify existing vulnerabilities in the supply chain & develop improved methods for ensuring the security of cargo entering and leaving the U.S. Those security techniques that prove successful under the program will then be recommended for implementation system-wide, Customs said. Congress, through the 2002 Supplemental Appropriations Act, provided US$28M in funding for OSC to improve the security of container shipments through pilot projects involving the 3 largest container ports of entry to the US. DOT's Transportation Security Administration (TSA) will solicit proposals from the ports of Los Angeles/Long Beach, New York/New Jersey, & Seattle/Tacoma for projects that include representation from all components of the supply chain, including major and minor ports and their feeder locations, overseas customers & port partners, and the shipping lines serving those locations.

Go Ro Ro ......... as the European Commission has cleared the joint acquisition by Sweden's Wallenius Lines & Norway's Wilhelmsen of the deep-sea car-carrier business of the Korean company Hyundai Merchant Marine. The EC said it was originally concerned that the deal might significantly reduce competition and lead to higher prices for the transport of cars between Europe & the Near East. Wallenius & Wilhelmsen provide their car carrier services through the 50/50 joint venture Wallenius Wilhelmsen Lines. The two companies will rename Hyundai's car-carrier arm "Ro-Ro Korea." A bad period for Ro/Ro's:

CSX Corp. Tows The Line ....... as the rail giant will sell its ocean carrier to The Carlye Group investment firm. CSX will receive US$300M in cash and securities, & will retain an interest in the carrier, to be renamed Horizon Lines LLC. The deal also includes CSX Lines subsidiary Horizon Services Group, a provider of IT services to ocean carriers & shippers. CSX Lines serves Alaska, Hawaii, Puerto Rico, & Guam.  John W. Snow, chairman & CEO of CSX Corp. was appointed by President Bush this month to serve as U.S. Secretary of the Treasury.

High Cost of Cold ........ as lines of the Westbound Transpacific Stabilization Agreement will introduce large increases in rates for westbound refrigerated meat shipments from the U.S. to Asia, effective July 2003. Rates on frozen & chilled beef and pork, & on frozen poultry, will increase by US$800 per 40-foot container for all-water port-to-port shipments from all U.S. coasts, & by US$1,000 per 40-foot container for intermodal inland point & mini-landbridge moves, effective July 1, 2003. Also as of July 1, "carriers will no longer provide transfers of frozen poultry free of charge at West Coast container freight stations. The Westbound Transpacific Stabilization Agreement shipping lines said that the rate increases are intended to offset "sharp, steady declines in freight revenues that have occurred during the past two years." WTSA members are APL, COSCO Container Lines, Evergreen Marine Corp., Hanjin, Hapag-Lloyd, Hyundai, "K" Line, MOL, NYK, OOCL, P&O Nedlloyd & Yang Ming. This should have a chilling effect on shippers.


Cost of The Cab Ride Downtown ......... as carriers of the eastbound Transpacific Stabilization Agreement & Westbound Transpacific Stabilization Agreement have adopted guidelines for slightly higher Alameda corridor charges on Int'l container shipments that pass through southern California. Revised charges are US$16 per 20-foot container, US$32 per 40-foot box as of Jan. 1. The higher Alameda corridor surcharge is a direct pass-through of charges the ocean carriers must pay to use the facility. Opened in April, the US$2.4Bn, 20-mile Alameda corridor rail express line connects the ports of Los Angeles & Long Beach to the transcontinental rail network east of downtown Los Angeles.

Cost of Aloha ........ as Matson Navigation Company, Inc. will implement a terminal handling charge on its Pacific Coast - Hawaii service as of Jan. 12, 2003. The charge will become part of the company's permanent rate structure & is designed to recover a portion of the costs associated with the movement of cargo through terminal facilities on the West Coast of the U.S. & in Hawaii. The initial charge will be US$200 per container for westbound freight and US$100 per container for eastbound freight.


Flags of Convenience Prosper ......... as "open registries," also known as flags of convenience, led the growth in the worldwide commercial fleet in 2001, according to a report of the UN Conference on Trade & Development. UNCTAD said in its annual "Review of Maritime Transport" report that the worldwide fleet expanded 2.1% in 2001, reaching 825.6 million deadweight tons at the beginning of 2002. "The biggest fleet expansion occurred in open-registry countries, where it was up 10.0 million deadweight tons to 402.4 million deadweight tons, or 48.7&of the world fleet in 2001," compared to 48.5% in 2000, the United Nations agency reported. UNCTAD noted that security & environmental concerns have been raised recently in connection with the open-registry fleet. Open registry flags are those of Panama, Liberia, Bahamas, Malta, Cyprus, Marshall Islands, Bermuda, St. Vincent, Antigua & Barbuda and other countries that have special registers for ships mainly owned by shipowners of 3rd countries. Meanwhile, the volume of world seaborne trade contracted in 2001, for the 1st time in 16 years. The 1% fall in seaborne trade, from 5.89 billion to 5.83 billion tons in 2001, was "mainly attributable to the economic downturn in the U.S., Japan and to a lesser extent Europe," UNCTAD said. For 2002 the UNCTAD report predicted that global maritime trade growth was to remain flat.

Watching For al-Qaida........ as Spain, Germany & other European nations have taken a lead role in patrolling Middle Eastern shipping lanes for al-Qaida terrorists & contraband - giving critical support to the very stretched U.S. Navy. The role of America's allies has often been overlooked, but was highlighted recently when Spanish commandos rappelled from helicopters onto
unflagged merchant
ship M/V Sosan & found 15 Scud missiles & warheads from North Korea hidden under cement sacks -- bound for Yemen. This was the 1st time so-called Task Force 150 - composed of warships from France, Great Britain, Germany, Spain & the U.S. -- discovered weapons since it began patrolling the Red Sea & Gulf of Aden around the Horn of Africa in Nov. 2001. The flotilla draws resources from the more-than dozen countries patrolling the region since 1990 to enforce sanctions against Iraq. The flotilla has had contact with 16,000 merchant ships, boarding over 200.


Hong Kong Stays #1 ...... as it expects its 2002 container volume to again lead the world, with a predicted annual throughput of 18.6 million TEU. The forecast annual volume would be a 4.6% increase over the 17.8-million TEUs handled in 2001. The port of Singapore, operated by PSA Corp., handled 15.5 million TEUs in 2001, but has not publicized its expected annual throughput for 2002. Singapore has suffered from the departure of Maersk Sealand to the neighboring port of Tanjung Pelepas. However, for the 1st seven months of 2002, the port of Singapore saw its container throughput increase 9.2%.

Port of Los Angeles On Top ...... as the largest container port in North America, widened its lead over the neighboring port of Long Beach with rapid growth figures in container volume for Nov. Despite the diversion of several services away from the port because of congestion, the port of Los Angeles handled 545,979 TEUs in Nov., 20% more than a year earlier. Loaded inbound volume increased 25% to 291,571 TEUs, while outbound cargo improved 7% to 95,722 TEUs. The increases in Los Angeles are partly caused by the switch of Maersk Sealand from Long Beach to Los Angeles in Aug. The neighboring port of Long Beach recently reported a 10% fall in traffic for November, to 335,149 TEUs, mainly due to the loss of the Maersk Sealand traffic. The combined container volume of the two large southern Californian ports for Nov. was 881,128 TEUs, a 6% increase on the 827,590 TEU level of Nov. 2001. Los Angeles handled 62% of the total in Nov. up from 55% a year earlier.

Barging In On The Problem ....... as the Port Authority of New York & New Jersey has started a new barge service for regional container transport. The Port Inland Distribution Network will begin by offering container barge service between the marine terminals & the Port of Albany, NY. The network will be a new service for containerized cargo, such as furniture, clothing and beverages that is now transported by truck. "One of the primary goals of the cargo distribution network is to reduce the heavy reliance of port customers on trucks to move cargo," the port authority said. "Currently, about 84% of the containers that come in to or go out of the port are transported by truck." "When all of the ports are on line by 2020, the percentage of maritime containers moved by truck could be reduced to 57%," the port authority added. "By then, more than 1,000 truck trips a day on New York roadways would be eliminated due to the Port Inland Distribution Network."

Port of Philadelphia Goes To War ...... as it made its debut Dec. 28 as a military seaport, which is expected to help the city compete for cargo business & federal funding. Workers at the Packer Avenue Marine Terminal loaded 3 helicopters & other heavy equipment onto a barge bound for Panama. The equipment belongs to the New Jersey National Guard & will be used in a training exercise. The port won the military seaport designation, which allows for military cargo to be shipped through the port, in Oct, after 3 years of planning by port officials & the Delaware River Maritime Enterprise Council. The lack of military certification had long hurt the port, which is in competition with seaports in New York & Norfolk, Va., for cargo business & federal funds for port improvement.

OTI Tickets Pulled ..... as the FMC has revoked 20 ocean transportation intermediary licenses because of the companies' failure to maintain valid bonds. The firms are: Admiral Line, Carlstadt, N.J.; Antilles Wholesale Co., Miami; Atlantic Cargo Lines, Miami; BLG Inc. of New York; Compass Shipping, Brooklyn, N.Y.; Cross Ocean Int'l, Palos Hills, Ill.; D.L. Central America, Miami; Eagle Int'l Express of Elk Grove Village, Ill.;, Houston; Global Freight Forwarding, Los Angeles; Hawk Int'l Transportation, Chelsea, Mass.; Int'l Shipping Corp. of Miami; Int'l Transport Services, Cleveland; Jacksonville Caribbean Broker Services, Jacksonville, Fla.; Millennium Logistics Services, Miami; Pan Asia Line Corp., Alhambra, Calif.; Reliable Overseas Shipping & Trading of Brooklyn, N.Y.; Sage Freight Systems, Jamaica, N.Y.; Seaborne Int'l, Inglewood, Calif.; and Sec Sea & Air, Carson, Calif.

Start Spreadin' The News ......... as steel from the World Trade Center will form the wave cutting bow
of USS New York (LPD 21), the 5th of 12 amphibious assault/dock ships of the San Antonio class, which the U.S. Navy calls one of its most technologically innovative. On Dec. 28 steel salvaged from wreckage of the World Trade Center was headed to the Northrop Grumman shipyard at Pascagoula, Miss., where construction is to begin next year for USS New York, a warship named in honor of those who perished in the Sept. 11 terrorist attack. The 684-foot vessel will carry a crew of 402 plus an 800 Marine expeditionary force. The US$800M vessel should be ready for active duty in 2007 & will be well credentialed to wage the War On Terror. This structural steel, primarily from a section of beam about 20 feet long & weighing 20 to 30 tons, was wreckage taken across New York Harbor to the Fresh Kills landfill on Staten Island after the Sept. 11 attack. It is believed to have been part of the South Tower, the 2nd of the twin skyscrapers hit by airliners hijacked by terrorists, but the 1st to collapse. Nearly 2,800 people died in the attack on the World Trade Center. Currently, only submarines are given state names, but state officials lobbied Navy Secretary Gordon England to make an exception. Other Navy ships have been named USS New York or USS New York City. The most recent USS New York was a battleship, commissioned in 1914, that fought in both the Atlantic & Pacific during World War II.  There may be many tributes to 9/11 -- but none are more appropriate than to send this steel to help extinguish the cause of its sorrow & hardened resolve. Newest vessel of the class is USS Mesa Verde (LPD 19)

This Month in U.S. Navy History
1830 - Naval Observatory, the 1st U.S. national observatory, established at Washington, DC, under commander of Lt. Louis Malesherbes.
1901 - 1st report of Ship Model Basin at Washington Navy Yard issued by Naval Constructor David W. Taylor who designed the basin. First facility of this type in U.S. to test hull shapes.
1917 - German submarine torpedoes sink
USS Jacob Jones (DD-61) off England.


5. The Cargo Letter Cargo Damage Dispatches               Return to index...

We're sorry, but there were so many sinkings, explosions, pirate attacks, fires, cargo mishaps, battles on the water & other disasters at sea that we do not have room to print even the highlights this month. Many people lost their lives at sea this month!! The recent, historic oil spill of single-hull tanker M/T Prestige off the Spanish coast! All the disasters in depth!

What about the loss of
M/V Haul Europe?

What about the US$40M loss of 2,900 new cars that went down in the English Channel with car carrier
M/V Tricolor?

You can read all this month's disaster news at our special Internet web feature which provides full details of each event -- our Vessel Casualties & Pirate Activity Database. Bookmark the site and visit every day! Updated twice daily. 

The loss of M/V Hanjin Pennsylvania -- exclusive photos you won't see elsewhere! Exploding containers laden with fireworks!!!!

SPECIAL NOTE: Please view the dramatic new pictures at our special "Gallery of Cargo Loss" website feature.

NOTE: The historic dangers of carriage by sea continue to be quite real. Shippers must be encouraged to purchase high quality marine cargo insurance from their freight forwarder or customs broker. It's dangerous out there.



OUR "D" Section: 
Freight Forwarder In Cyberspace

The Cargo Letter "Cyber Ports Of Call"               Return to index...

Here are our suggested world wide web sites of the week for your business, your information and your amusement ...............

History of The Maritime Bill of Lading ...
B/L As Document of Title

Bills of Lading From The Past

China Forwarders Move To Adopt Standard Trading Conditions

Fuel Cell Future ........ a next source.

Internationall Weather Forecast

Insurance Fraud Hall of Shame

Tribute In Light ........ the World Trade Center tribute in 360 degree VR.

U.S. Homeland Security ....... scope of the work ahead

Wireless Marketing ........ what's next.

PRODUCTS .......full-service Internet-based tracking and tracing program designed for the traditional freight forwarder (small or large) that requires no special software. Details here.

Sprinter 2000 ....... software package for freight forwarders & transport companies. It includes shipment entry & maintenance, printing of all required documents, invoicing, purchase invoices, reporting, conversion to accounting systems. Free demo download.
Details here.

Note: The Cargo Letter does not accept payment for product notifications.


Int'l. Assn. of Marine Investigators ......... Feb. 23 - 27, 2003, IAMI's 13th Annual Training Seminar. Hosted by the Bay County Sheriff's Office Florida Fish & Wildlife Agency, Edgewater Beach Resort. Details here.

KMZ Rosenman & Global Trade Advisory Group .......Jan. 22 -- Cargo security seminar at Greenville-Spartanburg Airport Marriott in South Carolina. Seminar will cover the U.S. Customs-Trade Partnership Against Terrorism program, focused assessments & importer self-assessments, & basic import compliance. Contact Info.

Los Angeles Harbor Transportation Club ............ 6 PM, Thur. Jan. 9, 2003, The Reef Restaurant, Long Beach Harbor. Speaker: John H. Heinrich Director Field Operations, U.S. Customs South Pacific Management Center.

Los Angeles Transportation Club ........ 14 Jan. -- 11:30AM, Norwalk Marriott, Norwalk, CA 90650. Speaker: Robert Calix, Senior Transportation Planning Manager, Metropolitan Transportation Authority

University of Miami ........ Jan, 22 - 24, 2003, "Supply Chain Management - Today & Tomorrow: Maximizing Profits & Customer Satisfaction," Biltmore Hotel - Conference Center of the Americas.


Baptistery & Romanesque Duomo in Parma, Italy ........architectural marvels housing priceless collections of Renaissance art. A set of QuickTime VR panoramas presented in stunning, full-screen 600,000,000-pixel detail lets you tour the Baptistery & wander the loggias & piazzas of the Duomo accompanied by haunting music. Zoom in for fast-loading, ultra-high-resolution close-ups of the medieval frescoes, paintings, & sculpture. Built in the 12th & 13th centuries, the spectacular pink marble sites are architectural marvels housing priceless collections of Renaissance art.

Jedi Knight II: Jedi Outcast ......... a new game for MAC X.

Phrase Finder ......... meanings and origins of phrases, sayings, cliches & quotes.

"Rainy Season" .......... Wauters's homage to the classic horror films of the 1950s. Based on a short story by Stephen King.
1-minute trailer and 15-minute short


Rock Internet Radio ...... don't let your boss hear this.

Statue of Liberty .......... you make the show in New York Harbor. A must!

The Virtual Mummy

OUR "E" Section: 
The Forwarder/Broker World

New Transport Related Legal Cases               Return to index...

Sprietsma v. Mercury Marine
U.S. Supreme Court

Dec. 3, 2002
Federal Boat Safety Act: (FBSA Does Not Pre-empt State Common-law Claims) The U.S. Supreme Court held unanimously that a state common-law tort is not pre-empted by the Federal Boat Safety Act (FBSA) or the decision by the Coast Guard to not regulate propeller guards on motorboats.

Husain v. Olympic Airways
9th Circuit U.S. Court of Appeals

12 Dec. 2002
Warsaw Convention: Abid Hanson died following his exposure to ambient 2nd-hand smoke while aboard Flight 417 of Olympic Airways (Olympic). Hanson was seated in the non-smoking section 3 rows in front of the smoking section. Husain, Hanson's wife, repeatedly with increasing urgency, asked the airline's employees to move Hanson to a different seat away from the smoking section. Husain explained to Leptourgou, a flight attendant, Hanson's medical condition & the consequences of smoke inhalation, but Leptourgou refused to relocate Hanson. Hanson died from a severe asthma attack caused by the smoke exposure. The Ninth Circuit held that the district court did not clearly err by finding that the refusal to move Hanson to another seat was an accident under Article 17 of the Warsaw Convention. Leptourgou violated the recognized standard of care for flight attendants, did not follow Olympic's policy, and did not alert the chief cabin attendant to relocate Hanson. Because this conduct by Leptourgou was negligent, it fits under the definition of an accident under Article 17 of the Warsaw Convention. The Ninth Circuit further held that Leptourgou was aware that Hanson was in a desperate situation that required immediate assistance, yet despite this knowledge and increasingly emphatic pleas from Husain, Leptourgou refused to assist. The Ninth Circuit held that this amounted to willful misconduct. AFFIRMED.

East West Corporation v. DKBS 1912 AKTS SVENBORG
Chile Law as determined by English Court - carrier liable for delivery of goods from authorized Customs warehouse without surrender of bill of lading.

Written from wire stories, the Associated Press, Reuters, Hong Kong Shipping News Lloyds & other world sources.

The Cargo Letter Correspondents:
Michael S. McDaniel Esq, Editor (Countryman & McDaniel)
David Schuchman -- Interpool Corp. -- Webmaster of The Cargo Letter Archive
Cameron W. Roberts, Esq. (Countryman & McDaniel)


The Cargo Letter
since 1978)

A world news service for Air/Ocean Freight Forwarders, NVOCC's, Consolidators, Indirect Air Carriers, Surveyors, Intermodal Shipper's Agents, Inland Carriers, Customs Brokers and Liability & Marine Underwriters world-wide ...........a free service to more than 8,000 industry subscribers & readers on 6 continents. 
Michael S.
McDaniel, Editor.

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