Cosco Shipping has been ordered by the US Federal Maritime Commission (FMC) to explain why it should not be hit with civil penalties of millions of dollars for taking more than seven months to pay a reparations award of $24,328.80 to a customer.
The case arises from a complaint filed with the FMC in July 2025 by Bridgewell Agribusiness. The company said it sought compensation from the state-owned Chinese carrier for demurrage and detention fees it paid on import containers in 2022. Bridgewell said the charges were levied by Cosco in violation of FMC regulations.
In the later order, the FMC ordered Cosco to pay $24,328.80 by 20 January 2026. But Bridgewell did not receive the money until 31 August.
The Commission said the payment was not made, but Bridgewell sent out a number of requests and the FMC made several contacts during the period of non-payment.
The regulator said in an order to show cause on 2 October it has power to impose civil penalties where reparations awards are not paid as required.
Federal rules permit inflation-adjusted penalties of up to $14,988 for each day of non-compliance. “Willful and knowing” violations can lead to daily penalties of up to $74,943.
The FMC said Cosco could therefore be fined between $3.34 million and $16.7 million, based on 223 days of possible non-compliance.
The Commission pointed out that the case could have serious financial repercussions.
Cosco had apparently been reminded repeatedly over several months about the unpaid bill, but had remained out of compliance with the FMC’s order for 223 days, it said. That raised the question of whether the alleged violations were knowing and willful, the agency said.
The FMC also referenced U.S. Supreme Court precedent and recent federal court decisions regarding the purpose of penalties for knowing and willful violations. The penalties are part of its efforts to stop companies engaging in similar conduct in the future, the Commission said.
The regulator said a larger penalty might be appropriate, within statutory limits, if needed to provide adequate deterrence.
The case is a strong message from the FMC to carriers who do not act quickly to comply with its orders.
Seatrade Maritime News has sought comment from Cosco. The carrier has until Dec. 1 to answer the FMC’s order and make arguments against the imposition of civil penalties for the late repayment.
