8 out of 10 Export-Import SMEs Oppose Amendment to Maritime Law... Concerns Over Freight Rate Increase

Korea Federation of SMEs Urgently Investigates Amendments to the Shipping Act
Greatest Concern Over Freight Rate Increases Due to Unfair Joint Actions

Eight out of ten small and medium-sized enterprises engaged in import and export oppose the amendment to the Shipping Act. Photo by Yonhap News

[Asia Economy Reporter Kim Heeyoon] It has been revealed that 8 out of 10 small and medium-sized export-import enterprises oppose the amendment to the Shipping Act.

According to the Korea Federation of SMEs on the 6th, a survey titled 'Opinions of Small and Medium Export-Import Enterprises on the Amendment to the Shipping Act' was conducted from September 28 to October 1 with 174 small and medium export-import enterprises. The results showed that 85.1% of the companies responded opposing the amendment (preferring to maintain the current law), while 14.9% supported the amendment.

The amendment to the Shipping Act centers on the complete exclusion of the Fair Trade Act regarding joint actions by shipping companies.

The biggest anticipated issues if the amendment passes were surveyed as follows: 'Freight rate increases due to unfair joint actions (46.0%)', 'No remedy available in case of disputes arising from unfair actions in the future (39.7%)', and 'Decrease in export-import due to increased instability in logistics freight rates (14.4%)'.

8.6% of companies reported having experienced unfair demands from shipping companies. The unfair demands from shipping companies were identified as 'Sudden notification of freight rate increases (86.7%)', 'Charging higher freight rates than those publicly announced (80.0%)', 'Refusal of shipment (13.3%)', and 'Non-cooperation in resolving disputes arising during transportation (6.7%)'.

Choomun Gap, Head of the Economic Policy Division at the Korea Federation of SMEs, stated, "Under the current Shipping Act, shipping companies are required to consult with cargo owners when deciding freight rates, etc. However, in reality, consultations often do not take place, and even when small cargo owners receive unfair demands such as sudden freight rate increases, they are afraid to report due to retaliation such as shipment refusal."

He added, "If the Fair Trade Act is completely excluded under this amendment, the disadvantages to small cargo owners caused by unilateral actions of shipping companies could worsen. Therefore, careful review of the amendment is necessary to at least prevent unfair joint actions."

This content was produced with the assistance of AI translation services.