The Ever Given arrest by Egyptian authorities spells continuing bad news for shippers. The vessel has been seized to ensure compensation is paid for the Suez Canal blockage. The figure surprised most, including the ship owners at $900 million dollars. likely to lead to a lengthy court battle to determine how this figure was arrived at. A court in Ismailia granted the seizure request on behalf of the Suez canal authority.
Egypt’s move to arrest the vessel underscores the legal implications surrounding ocean freight movements and shipping line responsibilities. The vessel grounding on the 23rd March may have been accidental but has had serious repercussions across worldwide global trade. The initial delays to other vessels have been well documented. The knock on effects have stretched far and wide.
Port congestion, already common has hit many major ports as vessels were trapped in the Suez Canal. Once the canal cleared all vessels were released within 6 days of each other. That bottleneck continues but is now centred around ports. Container shortages due to vessels held waiting to offload has not helped. Claims of container shortages in countries due to vessels not returning the usual allocation continues to have an effect on rates. Major ports such as Singapore and Rotterdam are expected to have logjams for several weeks due to schedule disruption as vessels try to catch up rotation. Logjams, delays and container shortages are a path to higher rates.
The cargo on the Ever Given under arrest
For those unlucky enough to have cargo on the Ever Given as reported this has only been the start. The vessel’s report of general average means that claims adjusters need to set a bond fee. With the Ever Given arrest the compensation figure will need to be factored in. The figure does not include salvage costs and the vessel remains on hold. The owners and their insurers were negotiating in good faith with the Suez Canal Authorities and were surprised by the vessel’s arrest. If this goes to court then this will become more complicated. With the vessel on hold until compensation is paid it seems likely that cargo will remain on board. The crew have certainly been advised they cannot leave the ship.
Once the vessel is released then the bond fee can be agreed and those with insurance can claim their cargo. Those without insurance will need to pay the bond fee to free their goods from the vessel. At the moment their is no visible timeframe for this. The charterer of the vessel, Taiwan’s Evergreen Marine Corp has confirmed they are looking at the court order. Trying to see if their is any scope for treating the vessel and cargo separately. If so they may be able to get the cargo released earlier. Still this will not be simple as it weakens the Egyptian authorities hold on the situation. With cargo on board the pressure will continue to mount on Evergreen to find a solution.