BIR Issues Statement Concerning Increased Theft from containers in China

The Bureau of International Recycling (BIR), Brussels, has issued a statement relating to concerns about what it calls a sharp increase in the theft of some recyclables from containers shipped overseas. According to BIR, the situation appears to be particularly noteworthy in the southern part of China.

To tackle the issue, BIR’s Secretariat, on behalf of its nonferrous division, is surveying BIR member companies anonymously to obtain information on the nature of the thefts, including the quantity and value of the stolen materials, ports used, shipping lines and other information.

In a letter addressed to member companies, Francis Veys, BIR director general, says many members have taken precautionary measures such as using heavy-duty locks and seals to prevent the doors of containers from being removed to allow for the theft of scrap metal.

Veys says members are reporting high-value materials such as high-grade copper scrap being generally targeted, “which leads us to believe that there is complicity among the few people who are aware of the contents of the containers.”

The association has approached the International Chamber of Commerce (ICC) for assistance. The BIR has contacted ICC’s Commercial Crime Services and its International Maritime Bureau, which regularly investigate container losses on behalf of its members.

The letter from the BIR states that should the association receive sufficient responses to its survey, it will take further action at the ICC level and with other authorities.

David Chiao, vice president of Uni-All Group Ltd., a brokerage firm based in Atlanta, says two of his customers have sustained losses of materials valued at more than $100,000 each in February. He says he believes the thefts may have occurred near Nanhai, in southern China, possibly during the stevedoring process.

Importers have claimed dirt, rocks or iron ore were added to containers, apparently to replace the weight of the missing material.

“This isn’t shoplifting,” Chiao says. “Now it’s organized crime.”

Chiao says that the thefts have been reported to Chinese authorities and that insurance companies have rejected submitted claims for the stolen materials.

He says his biggest concern is the impact the thefts will have on importers, who are either building the losses from the thefts into their costs or who may decide to halt imports until the situation improves.

“Of course we are hoping for a very in-depth investigation of this organized crime,” Chiao says.

Other exporters have echoed their concern, saying the theft was small enough to keep it from being a high-profile issue until recently.

Meanwhile, the Institute of Scrap Recycling Industries (ISRI), Washinton, D.C., also has started to investigate the situation, says Scott Horne, ISRI general counsel and vice president of government affairs. “We are talking to a number of U.S. government agencies; we are talking with foreign governments, both with people in the country and at their embassies,” he says. While not commenting on how widespread the situation may be, Horne says the losses sustained in the instances he’s aware of have been significant. “Now that it has become a significant problem for some members, we are becoming more involved,” Horne adds.

He urges exporters to be sure that contract terms with carriers are appropriate. “Shippers who enter into contracts with a carrier have the right to negotiate,” he says.

Horne also says shippers who experience theft need to make their carriers aware of the problem and should address any provision in the contract that would otherwise absolve the carrier from liability.

“I would put the carrier on notice,” Horne says. “And you should try and negotiate terms that will help protect your material in transit.”