Best Practices for VGM Submission - CargoSmartOn€¦ · Best Practices for VGM Submission Alan Yip...

Best Practices for VGM Submission

Alan Yip

CargoSmart Limited

[email protected]

June 21, 2016

mailto:[email protected]

Agenda

• Regional Implementation Guidelines Updates

• United States Equivalency Method Updates

• 5-Step Guide to Prepare for SOLAS Compliance – Updates and Insights

Prepare to File by Country and Carrier

Select Your Weighing Method

Determine Who Will Provide and Submit the VGM

Prepare Submission Channels and Platforms

Establish Proper Processes

• Questions and Answers

© CargoSmart, All Rights Reserved 2

Regional Implementation Guidelines Updates


• Countries that published guidelines in June: – Brazil

– France

– Spain

– United States

• Countries that updated guidelines in June: – Australia

– Belgium

– China

Tip: The World Shipping Council posts the latest country guidelines as they become available:

http://www.worldshipping.org/industry-issues/safety/global-container-weight-verification-rule-effective-july-1-2016

As of June 21, 2016, 24

countries out of the 162

signatory IMO Member

States have issued

guidelines





















United States Equivalency Method Updates


• April 28, 2016 - The US Coast Guard declared an equivalency to

the SOLAS VGM requirements - terminals could provide the VGM

on behalf of the shipper when authorized

• June 20, 2016 - The Ocean Carrier Equipment Management

Association that represents 19 carriers in US trades, stated that it

supports the use of on-terminal scales to obtain the VGM

• June 21, 2016 - Questions remain:

– Will all terminals in the US provide the VGM to comply timely with SOLAS?

– What are the exceptions, such as on-dock rail shipments that are not weighed

at the terminal? How will shippers provide the VGM for these shipments?

1. Prepare to File by Country and Carrier


Register Some countries require a shipper registration beforehand. Review countries’ guidelines.

LOAs Ensure Letters of Authorization (LOAs) with your ocean carriers are in place for transmitting VGM data through a third-party if necessary

Carrier Requirements

Confirm with your carriers on their requirements and cutoff times in advance to determine your VGM processes.

2. Select Your Weighing Method

6 factors to consider for weighing methods:


Cargo Nature VGM Cutoff Time in the

Shipping Process

Availability of Weighing

Equipment

Regional Requirements

and Conditions

Availability and Cost of

Terminal Weighing

Service

Availability of Container

Tare Weight

Method 1: Weigh loaded container

Method 2: Add cargo and container tare weights

Equivalencies: Region-specific

3. Determine Who Will Provide and Submit the VGM


Shippers

Terminals

3rd Parties

- Consolidators

- Forwarders

- Weighing Parties

Ocean Carriers

• In-house – Ensure team

members know new

requirements, responsibilities,

and cutoff times

• Third-party – Establish

process to determine who will

provide the VGM and who will

submit it to the carriers

4. Prepare Submission Channels and Platforms


• Electronic or Manual – Carriers have indicated that shippers who provide the VGM

electronically may be given a later VGM cutoff time than manual submissions

• Online – Ensure people submitting the VGM have a user account set up

• EDI – Review implementation guides for SI and VERMAS to make system changes

• Mobile – Ensure your carriers and service providers can accept VGM submission through

mobile devices if you plan to assign a 3rd party to submit the VGM

• Excel Upload / Email – Ensure your carriers and service providers accept VGM

submission in Excel or email formats

• Manual – Check with carriers on the VGM cutoff for manual submissions

4. Prepare Submission Channels and Platforms


When choosing the platform to submit VGMs and collaborate with multiple parties, consider

the following:

An Integrated Common Platform for Multiple Parties

Visibility to VGM Status

Access to Flexible Channels

Cost to Use the Platform

Efficiency When Managing Multiple Carrier Shipments

Notifications of Due Dates

5. Establish Proper Processes with All Parties


1 Staff and Resources - Are your staff available during the container weighing and

delivery times?

2 Weigh Stations - If there are queues, do you have staff available to wait and what

are your costs for this overhead?

3 CY Cutoff Times - Don’t forget to review the details and understand the time

between the weigh station and the CY Cutoff. How much time do you have to

communicate the weight and submit it timely?

4 Truckers - Who is handling your trucking arrangements, do you have leverage to

ensure the truckers cooperate to provide data timely?

5 NVO Shipments – BCOs are not responsible, but they may be required to send

the weight data to the NVO. How are the NVOs accepting the VGM data?

Getting Started Checklist


Prepare to file – Submit registrations, complete LOAs, and confirm

carrier requirements

Choose submission channel and a flexible platform to submit VGM that

facilitates your collaboration process with multiple parties

Establish proper processes with local operations and related parties

to ensure timely VGM submissions

Select the weighing methods that best fit your business needs and

processes and fulfills the regional requirements and conditions

Determine who will provide the VGM and who will submit it to the carrier

VGM Testing

• Join thousands of shippers and freight forwarders

to start VGM testing on CargoSmart’s platform to

prepare before July 1

• Visit CargoSmart’s VGM testing site at

www.cargosmart.com/vgm-testing/

http://www.cargosmart.com/vgm-testing/



Questions from Attendees


Question 1

Is there a standard tolerance error limit of the VGM?

The tolerance level is subject to each individual country’s implementation. For example, Belgium and

Singapore indicate a tolerance of plus or minus 5% of the container weight while Canada indicates a

tolerance of plus or minus 5% but not more than 500 kilograms. You will need to pay attention to each

country’s guidelines.



Question 2

Who will check the accuracy of the VGM?

According to the SOLAS guidelines from the World Shipping Council, there is no legal obligation for

carriers and terminals to check the VGM. However, some countries’ enforcement agencies may

perform the weight checking. For example, China’s marine management agencies will perform random

checks on the VGM. You can find more details in the guidelines, which are translated by CargoSmart

and posted on the World Shipping Council’s website.

Therefore, whether there is weight checking is subject to each country’s implementation and also

terminals’ and carriers’ operations.



Question 3

If there is a discrepancy found in the submitted VGM, what will

happen?

According to the SOLAS guidelines, the ship's master should accept the cargo on board his ship only

if he is satisfied that it can be safely transported. The ship master retains ultimate discretion in

deciding whether to accept a packed container for loading onto his ship.

If your container is on hold due to a discrepancy, you should supplement an accurate VGM or contact

your local carrier contact as soon as possible.

For penalties, it is subject to country specific guidelines. Some countries indicated there will be a fine

for incorrect reporting. Also, some terminals indicated that there will be additional charges if the

container has to be weighed again or unloaded from the vessel due to a weight discrepancy.



Question 4

My country does not issue any guidelines on SOLAS VGM. Does it

mean that I do not need to submit the VGM for my export containers?

SOLAS itself has international legal status so there need not be any further implementing legislation

for the contracting countries. If your country is one of the SOLAS contracting countries, you still need

to submit the VGM for your export containers.

Also, carriers may require you to submit the VGM no matter which port you are loading the containers

since it is a safety issue. In addition, carriers may change the transshipment port later so you had

better submit your VGM no matter which loading port.



Question 5

When is the cutoff time of the VGM?

The VGM cutoff varies by carrier and port and is not mandated by the SOLAS requirement. However,

in practical terms, the shipper must submit it early enough for the carrier to use the VGM figure in its

stowage plan, which is a requirement the SOLAS rule puts specifically on the terminal and carrier.

Carriers will advise the VGM cutoff time in online schedules or in the booking confirmation. The VGM

cutoff will likely be before the CY cutoff.



Question 6

Do we have a deadline to update or correct the VGM?

We recommend that you submit your updated VGM data to your carriers as soon as you receive it and

before the VGM cut-off time. Whether amendments after the cutoff time will be accepted depends on

the decision of carriers’ local offices.



Question 7

How can I find out the tare weight of each container?

According to SOLAS guidelines published by the World Shipping Council and The Ocean Carrier

Equipment Management Association (OCEMA), if using Method 2, Shippers may use the container

tare weight marked on the container. Checking the tare weight printed on the container is just one of

three ways to collect the container tare weight. Besides checking with your trucker or warehouse, you

can also directly contact your carrier’s customer service department. Also, most carriers have

published the container tare weight information on their websites.

It can be very time-consuming to check with carriers or their websites one by one to get the container

tare weight. It would be more efficient to have a centralized platform or database for collecting this

information. CargoSmart’s platform provides a tare weight link to corresponding carriers’ websites.

The centralized platform allows you to source the container tare weight more easily and efficiently.



Question 8

If we are a freight forwarder and our company name is shown as the

shipper in the master bill of landing, does that mean we can submit the

VGM on behalf of the actual shipper?

The SOLAS VGM requirement defines “shipper” as the person named on the ocean bill of lading. If

you are named on the ocean bill, you are responsible for the VGM submission. But if you are only

providing a service to the shipper to make bookings and submit shipping instructions, you will be

considered a 3rd party. The shipper needs to authorize you do the VGM submission. CargoSmart

provides solutions for 3rd parties to help shippers submit the VGM through online and mobile

channels.



Question 9

Do we have to show the VGM on bill of lading?

There is no requirement to show the VGM on the bill of lading. It is subject to individual

carrier’s practices. You may check with your local carrier contact.



Question 10

Do I need to amend my invoice and packing list if a variance is found

between the weight shown on the document and the weight measured

at the port?

Since the weight shown on the invoice and packing list is not the VGM, normally it is not necessary to

amend the invoice and packing list in this case. However, we recommend you to double check with

your local carrier contact.



Question 11

I am a freight forwarder. What if the shipper provides me incorrect

cargo weight and I submit the wrong information to the carrier, will I

receive penalties?

It depends on whether you are the named “shipper” on the ocean bill of lading or if you are helping the

shipper to submit the VGM. If you are the “shipper” on the ocean bill, you will be responsible for

verifying the container weight of the packed container according to the SOLAS requirements.

Therefore, in case of any penalties due to mis-declaration, you will be liable for it.



Question 12

For shipments that are via rail, is the VGM due prior to container in-

gating at the rail depot or in-gating at the loading port?

In principle, the VGM should be due prior to container in-gating at the loading port since the VGM is

used for stowage planning at the loading port. However, the VGM cutoff is set by the carrier. You may

need to check with your local carrier contact to confirm the VGM submission deadline in this case.



Question 13

Some countries require registration before submitting the VGM. If my

company is located in one of those countries, will I need to do the

registration for VGM submission?

As long as you have cargo to be exported from those countries and you are the “shipper” on the

ocean bill of lading, you will need to do the registration.

Some countries only require shippers using Method 2 for registration, while some may require all

shippers to do the registration. Please refer to the local guidelines to make sure if you are an eligible

party for VGM registration. For some European countries, such as Belgium and Italy, if you are a

certified AEO, you do not need to do additional registration.



Question 14

What is the authorized person signature and is it compulsory?

The document declaring the verified gross mass of the packed container should be signed by a

person duly authorized by the shipper. The information and signature may be transmitted

electronically, and the signature may consist of the last name of the responsible person in capital

letters.



Question 15

We are submitting the VGM for the shipper. Can we use our name for

the authorized person signature or does it need to be someone from

the shipper company listed on the ocean bill of lading?

If the shipper has authorized you to submit the VGM, you can use your name for the authorized

person signature.



Question 16

Does the VGM provided by the shipper need to be verified by a third

party?

According to the SOLAS requirements, the shipper should be the responsible party to verify the gross

weight of the packed container. Therefore, once the shipper has submitted the VGM and declared it is

verified, it is not necessary for a third party to verify again.



Question 17

What is the cost if I submit the VGM through CargoSmart?

If you submit your booking requests or shipping instructions through CargoSmart, you can submit the

corresponding VGMs to your carriers at no charge. A standalone VGM submission package is also

available for a charge. If you would like to know the pricing details, you can email us at

[email protected] to learn more.




Question 18

How long will the carrier system take to update after the VGM is

submitted?

If you submit the VGM through CargoSmart, we will transmit the VGM to your carrier once you submit

it. How long the carrier will take to acknowledge receipt or accept the submission, it is subject to each

individual carrier’s practice.



Question 19

The IMO recently stated that authorities should take a ‘practical and

pragmatic approach’ when enforcing the new SOLAS rules for the first

3 months. Does this mean that we do not need to submit the VGM for

the first 3 months?

Actually it does not mean to delay the implementation of the SOLAS requirements and no authorities

or carriers have announced any grace period yet. Once again, since loading the container on board is

subject to a carrier’s final decision, we recommend you to try your best to fulfill the SOLAS

requirements in order to have your cargo delivered on time.



Question 20

If my company wants to collect and submit the VGM on our own, what

do we need to consider?

First, if you plan to use Method 1, you will need to evaluate whether you have certified weighing

equipment in place. For Method 2, you will need to think about whether the process to collect the

cargo weight and the tare weight can met before the VGM cutoff time.

Next, you also need to consider whether you have sufficient internal resources to weigh containers

one by one.

Also, if you need to work with other related parties to collect the VGM, you need to evaluate whether

you have a flexible platform to collaborate with them.



Question 21

I’m currently submitting bookings and shipping instructions to carriers

through email. What should I be aware of if I plan to submit the VGM

through email?

For manual VGM submission, you need to check with your carriers about the VGM cutoff since the

cutoff for manual submission will be earlier than electronic submission. You will need to plan to submit

it earlier. Also, you may need to check with your carriers whether there is dedicated process to submit

the VGM through email.

In order to submit timely VGMs, we highly recommend you to submit it through an electronic channel.

This will allow more time for you to prepare. Also, you can have visibility to the submission status

through an electronic channel such as CargoSmart.

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• Join the SOLAS Group on LinkedIn (SOLAS – New VGM Requirement)

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• Learn more at www.cargosmart.com/solas-vgm-resources/

• Contact us at [email protected]

http://www.cargosmart.com/solas-vgm-resources/






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