Virtual Container Yard: Assessing the Perceived Impact of Legal Implications to Container Carriers
Virtual Container Yard (VCY) is a modern concept that helps to reduce the empty container repositioning cost of carriers. The concept of VCY is based on container interchange between shipping lines. Although this mechanism has been theoretically accepted by the shipping community as a feasible solution, it has not yet achieved the necessary momentum among container shipping lines (CSL). This paper investigates whether there is any legal influence on this industry myopia about the VCY. It is believed that this is the first publication that focuses on the legal aspects of container exchange between carriers. Not much literature on this subject is available. This study establishes with statistical evidence that there is a phobia prevailing in the shipping industry that exchanging containers with other carriers may lead to various legal implications. The complexity of exchange is two faceted. CSLs assume that offering a container to another carrier (obviously, a competitor in terms of commercial context) or using a container offered by another carrier may lead to undue legal implications. This research reveals that this fear is reflected through four types of perceived components, namely: shipping associate; warehouse associate; network associate; and trading associate. These components carry eighteen subcomponents that comprehensively cover the entire process of a container shipment. The statistical explanation has been supported through regression analysis; INCO terms were used to illustrate the shipping process.
[1] L. Edirisinghe, "Cross-border Logistics Performance in Sri Lanka: The way forward," in International Conference on Business Management, Colombo, 2013.
[2] IMO, "Safe transport of containers," 21 07 2019. [Online]. Available: http://www.imo.org/en/MediaCentre/HotTopics/container/Pages/default.aspx.
[3] L. Edirisinghe and A. Wijeratne, "A Sustainable Commercial Hub in Sri Lanka: The Role of Automobile INdustry," Colombo, 2015.
[4] L. Edirisinghe, Z. Jin and A. Wijeratne, "Container Inventory Management: Factors influencing Container Interchange," in 13th International Conference on Business Management, Sri Jayawardanepura, 2016 b).
[5] L. Edirisinghe and A. Rodrigo, "A Study on Electronic Toll Collection Systems in Expressways in Sri Lanka," in 8th International Research Conference, Ratmalana, 2015.
[6] L. Edirisinghe and Z. Jin, "The Reality of Container Exchange between Carriers: Clearing the Pathway to Virtual Container Pool," Transport Policy, vol. 72, no. December 2018, pp. 55-66, 2018.
[7] L. Edirisinghe and J. Zhihong, "The Benefits of Container Exchange between Carriers: A Case Study," Moratuwa, 2016 c.
[8] L. Edirisinghe, Z. Jin and A. Wijeratne, "Factors that Influence Container Inventory Management Strategies," in International Conference on Management and Economics, Ruhuna, 2017.
[9] L. Edirisinghe, "Virtual Container Pool: Solution to Container Inventory Management," Logistics Conference 2016 Journal, pp. 179-204, 2016.
[10] L. Edirisinghe, J. Zhihong and A. Wijeratne, "The Global Impact of Container Inventory Imbalance and the Factors that Influence Container Inventory Management Strategies," in 13th International Conference on Business Management, Sri Jayawardanepura, 2016 a.
[11] L. Edirisinghe, "The Influence of Logistics Competence in International Trade in Sri Lanka: A Contemporary Study," in 6th International Conference of Sri Lanka Forum of University Economists, Mihintale, 2017.
[12] L. Edirisinghe, Z. Jin, A. Wijeratne and R. Mudunkotuwa, "Mitigating the Cost of Empty Container Repositioning through the Virtual Container Yard: An Appraisal of Carriers’ Perceptions," in International Conference on Maritime Transport Costs and Port Efficiency, Tokyo, Japan, 2019a.
[13] L. Edirisinghe and J. Zhihong, "Trucking Industry Perception of Congestion Problems and Potential Solutions to Container Transportation in Sri Lanka," in KDU International Research Conference 2014- Expanding Development Horizons through Education,Research and Innovation, Ratmalana, 2014.
[14] L. Edirisinghe, J. Zhihong and A. Wijeratne, "Container Interchange: the 6 R Model Approach," in GOL University of LeHavre available online http://ieeexplore.ieee.org/stamp/stamp.jsp?tp=&arnumber=8378070&isnumber=8378066, Le Havre, France, 2018 c.
[15] L. Edirisinghe, Z. Jin, A. Wijeratne and R. Mudunkotuwa, "The Virtual Container Yard: Identifying the Persuasive Factors in Container Interchange," in 21st International Conference on Maritime Transport Costs and Port Efficiency, Tokyo, Japan, 2019.
[16] L. Edirisinghe, "Regional Cooperation for Maritime Logistics:the commercial perspectives of Sri Lanka," in Fostering Strategic Partnerships for Maritime Logistics, Trincomalee, 2017.
[17] H. Edirisinghe and L. Edirisinghe, "Selection of an Algorithm to Operationalize the Virtual Container Yard," in Reserach for Transport and Logisics Industry, Sri Jayawardenapura, 2019.
[18] A. D. Ross, V. Jayaraman, A. Rodrigues and D. A. Mollenkopf, "Repositioning of reusable containers in a sustainable global supply chain environment," Journal International Journal of Mathematics in Operational Research, vol. 2, no. 2, pp. 178-204, 2010.
[19] J. Karmelic, Č. Dundovic and I. Kolanovic, "Empty Container Logistics," Transport Logistics Review -Traffic&Transportation, vol. 24, no. 3, pp. 223-230, 2012.
[20] N. Mittal, "Regional Empty Marine Container Management," Neha Mittal, New Jersey, 2008.
[21] Maersk Line, "Terms for Carriage," Maersk Line, 2019. (Online). Available: https://terms.maerskline.com/carriage. (Accessed 26 10 2019).
[22] L. Edirisinghe and S. Muller, "Converting Sri Lanka into a Commercial Hub in Asia An assessment of postwar progress with insights to the way forward - A Case Study," in General Sir John Kothelawala Defense University International Research Conference, Colombo, 2013.
[23] C. Sys, "Is the container liner shipping industry an oligopoly?," Transport Policy, pp. 259-270, 2009.
[24] ICSC, "International Convention for Safe Containers," 2 December 1972. (Online). (Accessed 18 June 2013).
[25] D.-P. Song and J. Carter, "Empty container repositioning in liner shipping1," Maritime Policy & Management: The flagship journal of international shipping and port research, vol. 36, no. 4, pp. 291-307, 2009.
[26] J.-X. Dong, J. Xu and D.-P. Song, "Assessment of empty container repositioning policies in maritime transport," The International Journal of Logistics Management, vol. 24, no. 1, pp. 49-72, 2013.
[27] R. Erakovich and T. Anderson, "Cross-sector collaboration:management decision and change model," International Journal of Public Sector Management, vol. 26, no. 2, pp. 163-173, 2013.
[28] S. Ahman and A. Tidstrom, "The process of ending inter-organizational cooperation," Journal of Business & Industrial Marketing, vol. 21/5 , no. 5, p. 281–290, 2006.
[29] G. Kumar and R. N. Banerjee, "Collaboration in supply chain An assessment of hierarchical model using partial least squares (PLS)," International Journal of Productivity and Performance Management, vol. 61, no. 8, pp. 897-918, 2012.
[30] D. Hawkins and B. Little, "Embedding collaboration through standards-the key aspects of BS 11000 – part 2," j Industrial and Commercial Training, vol. 43, no. 4, pp. 239-246, 2011.
[31] J. Hughes and J. Weiss, "Simple Rules for Making Alliances Work," November 2007. (Online). Available: http://hbr.org/2007/11/simple-rules-for-making-alliances-work/ar/1. (Accessed 11 04 2014).
[32] M. P. d. Brito and R. Konings, "Container management strategies to deal with the East-West flows imbalance," 2013. (Online). Available: http://www.fucam.ac.be/S%C3%A9minaires,%20conf%C3%A9rences%20et%20colloques/Nectar/images/debrito_konings.pdf. (Accessed 26 April 2013).
[33] R. Epstein, A. Neely, A. Weintraub, F. Valenzuela, S. Hurtado, G. Gonzalez, A. Beiza, M. Naveas, F. Infante, F. Alarcon, G. Angulo, C. Berner, J. Catalan, C. Gonzalez and D. Yung, "A Strategic Empty Container Logistics Optimization in a Major Shipping Company," Interfaces, vol. 42, no. 1, p. 5–16, 2012.
[34] Alphaliner, "Container shortage to hit shippers," Weekly Newsletter, 11 03 2011.
[35] M. Weinschenk, "The Forgotten Shipping Market Making a Killing," 2012. (Online). Available: http://www.wallstreetdaily.com/2012/02/08/the-shipping-market-making-a-killing/. (Accessed 18 07 2014).
[36] L. Edirisinghe, Z. Jin and A. Wijeratne, "Container Inventory Management: introducing the 3 F model," International Journal of Logistics Systems and Management, vol. 31, no. 3, pp. 363 - 386, 2018 a.
[37] L. Edirisinghe and J. Zhihong, "Virtual Container Pool: Solution to Container Inventory Imbalance," Logistics Conference 2016 Journal, pp. 179-204, 2016.
[38] A. B. Borade and S. V. Bansod, "Vendor Managed Inventory practices in Indian SMEs: select differences in manufacturing and service sector," Int. J. of Logistics Systems and Management, vol. 11, no. 4, pp. 450 - 472, 2012.
[39] L. D. Peters, W. J. Johnston, A. D. Pressey and T. Kendrick, "Collaboration and collective learning:networks as learning organisations," Journal of Business & Industrial Marketing, vol. 25, no. 6, p. 478–484, 2010.
[40] FMC, "Study of the 2008 Repeal of the Liner Conference Exemption from European Union Competition Law," Federal Maritime Commission, Washington, DC, 2012.
[41] ICC, "INCO Terms," 23 07 2019. (Online). Available: https://iccwbo.org/publication/incoterms-rules-2010/.
[42] ICC, "INCOTERMS 2010," International Chamber of Commerce, 2019. (Online). Available: https://iccwbo.org/resources-for-business/incoterms-rules/incoterms-rules-2010/. (Accessed 26 10 2019).
[1] L. Edirisinghe, "Cross-border Logistics Performance in Sri Lanka: The way forward," in International Conference on Business Management, Colombo, 2013.
[2] IMO, "Safe transport of containers," 21 07 2019. [Online]. Available: http://www.imo.org/en/MediaCentre/HotTopics/container/Pages/default.aspx.
[3] L. Edirisinghe and A. Wijeratne, "A Sustainable Commercial Hub in Sri Lanka: The Role of Automobile INdustry," Colombo, 2015.
[4] L. Edirisinghe, Z. Jin and A. Wijeratne, "Container Inventory Management: Factors influencing Container Interchange," in 13th International Conference on Business Management, Sri Jayawardanepura, 2016 b).
[5] L. Edirisinghe and A. Rodrigo, "A Study on Electronic Toll Collection Systems in Expressways in Sri Lanka," in 8th International Research Conference, Ratmalana, 2015.
[6] L. Edirisinghe and Z. Jin, "The Reality of Container Exchange between Carriers: Clearing the Pathway to Virtual Container Pool," Transport Policy, vol. 72, no. December 2018, pp. 55-66, 2018.
[7] L. Edirisinghe and J. Zhihong, "The Benefits of Container Exchange between Carriers: A Case Study," Moratuwa, 2016 c.
[8] L. Edirisinghe, Z. Jin and A. Wijeratne, "Factors that Influence Container Inventory Management Strategies," in International Conference on Management and Economics, Ruhuna, 2017.
[9] L. Edirisinghe, "Virtual Container Pool: Solution to Container Inventory Management," Logistics Conference 2016 Journal, pp. 179-204, 2016.
[10] L. Edirisinghe, J. Zhihong and A. Wijeratne, "The Global Impact of Container Inventory Imbalance and the Factors that Influence Container Inventory Management Strategies," in 13th International Conference on Business Management, Sri Jayawardanepura, 2016 a.
[11] L. Edirisinghe, "The Influence of Logistics Competence in International Trade in Sri Lanka: A Contemporary Study," in 6th International Conference of Sri Lanka Forum of University Economists, Mihintale, 2017.
[12] L. Edirisinghe, Z. Jin, A. Wijeratne and R. Mudunkotuwa, "Mitigating the Cost of Empty Container Repositioning through the Virtual Container Yard: An Appraisal of Carriers’ Perceptions," in International Conference on Maritime Transport Costs and Port Efficiency, Tokyo, Japan, 2019a.
[13] L. Edirisinghe and J. Zhihong, "Trucking Industry Perception of Congestion Problems and Potential Solutions to Container Transportation in Sri Lanka," in KDU International Research Conference 2014- Expanding Development Horizons through Education,Research and Innovation, Ratmalana, 2014.
[14] L. Edirisinghe, J. Zhihong and A. Wijeratne, "Container Interchange: the 6 R Model Approach," in GOL University of LeHavre available online http://ieeexplore.ieee.org/stamp/stamp.jsp?tp=&arnumber=8378070&isnumber=8378066, Le Havre, France, 2018 c.
[15] L. Edirisinghe, Z. Jin, A. Wijeratne and R. Mudunkotuwa, "The Virtual Container Yard: Identifying the Persuasive Factors in Container Interchange," in 21st International Conference on Maritime Transport Costs and Port Efficiency, Tokyo, Japan, 2019.
[16] L. Edirisinghe, "Regional Cooperation for Maritime Logistics:the commercial perspectives of Sri Lanka," in Fostering Strategic Partnerships for Maritime Logistics, Trincomalee, 2017.
[17] H. Edirisinghe and L. Edirisinghe, "Selection of an Algorithm to Operationalize the Virtual Container Yard," in Reserach for Transport and Logisics Industry, Sri Jayawardenapura, 2019.
[18] A. D. Ross, V. Jayaraman, A. Rodrigues and D. A. Mollenkopf, "Repositioning of reusable containers in a sustainable global supply chain environment," Journal International Journal of Mathematics in Operational Research, vol. 2, no. 2, pp. 178-204, 2010.
[19] J. Karmelic, Č. Dundovic and I. Kolanovic, "Empty Container Logistics," Transport Logistics Review -Traffic&Transportation, vol. 24, no. 3, pp. 223-230, 2012.
[20] N. Mittal, "Regional Empty Marine Container Management," Neha Mittal, New Jersey, 2008.
[21] Maersk Line, "Terms for Carriage," Maersk Line, 2019. (Online). Available: https://terms.maerskline.com/carriage. (Accessed 26 10 2019).
[22] L. Edirisinghe and S. Muller, "Converting Sri Lanka into a Commercial Hub in Asia An assessment of postwar progress with insights to the way forward - A Case Study," in General Sir John Kothelawala Defense University International Research Conference, Colombo, 2013.
[23] C. Sys, "Is the container liner shipping industry an oligopoly?," Transport Policy, pp. 259-270, 2009.
[24] ICSC, "International Convention for Safe Containers," 2 December 1972. (Online). (Accessed 18 June 2013).
[25] D.-P. Song and J. Carter, "Empty container repositioning in liner shipping1," Maritime Policy & Management: The flagship journal of international shipping and port research, vol. 36, no. 4, pp. 291-307, 2009.
[26] J.-X. Dong, J. Xu and D.-P. Song, "Assessment of empty container repositioning policies in maritime transport," The International Journal of Logistics Management, vol. 24, no. 1, pp. 49-72, 2013.
[27] R. Erakovich and T. Anderson, "Cross-sector collaboration:management decision and change model," International Journal of Public Sector Management, vol. 26, no. 2, pp. 163-173, 2013.
[28] S. Ahman and A. Tidstrom, "The process of ending inter-organizational cooperation," Journal of Business & Industrial Marketing, vol. 21/5 , no. 5, p. 281–290, 2006.
[29] G. Kumar and R. N. Banerjee, "Collaboration in supply chain An assessment of hierarchical model using partial least squares (PLS)," International Journal of Productivity and Performance Management, vol. 61, no. 8, pp. 897-918, 2012.
[30] D. Hawkins and B. Little, "Embedding collaboration through standards-the key aspects of BS 11000 – part 2," j Industrial and Commercial Training, vol. 43, no. 4, pp. 239-246, 2011.
[31] J. Hughes and J. Weiss, "Simple Rules for Making Alliances Work," November 2007. (Online). Available: http://hbr.org/2007/11/simple-rules-for-making-alliances-work/ar/1. (Accessed 11 04 2014).
[32] M. P. d. Brito and R. Konings, "Container management strategies to deal with the East-West flows imbalance," 2013. (Online). Available: http://www.fucam.ac.be/S%C3%A9minaires,%20conf%C3%A9rences%20et%20colloques/Nectar/images/debrito_konings.pdf. (Accessed 26 April 2013).
[33] R. Epstein, A. Neely, A. Weintraub, F. Valenzuela, S. Hurtado, G. Gonzalez, A. Beiza, M. Naveas, F. Infante, F. Alarcon, G. Angulo, C. Berner, J. Catalan, C. Gonzalez and D. Yung, "A Strategic Empty Container Logistics Optimization in a Major Shipping Company," Interfaces, vol. 42, no. 1, p. 5–16, 2012.
[34] Alphaliner, "Container shortage to hit shippers," Weekly Newsletter, 11 03 2011.
[35] M. Weinschenk, "The Forgotten Shipping Market Making a Killing," 2012. (Online). Available: http://www.wallstreetdaily.com/2012/02/08/the-shipping-market-making-a-killing/. (Accessed 18 07 2014).
[36] L. Edirisinghe, Z. Jin and A. Wijeratne, "Container Inventory Management: introducing the 3 F model," International Journal of Logistics Systems and Management, vol. 31, no. 3, pp. 363 - 386, 2018 a.
[37] L. Edirisinghe and J. Zhihong, "Virtual Container Pool: Solution to Container Inventory Imbalance," Logistics Conference 2016 Journal, pp. 179-204, 2016.
[38] A. B. Borade and S. V. Bansod, "Vendor Managed Inventory practices in Indian SMEs: select differences in manufacturing and service sector," Int. J. of Logistics Systems and Management, vol. 11, no. 4, pp. 450 - 472, 2012.
[39] L. D. Peters, W. J. Johnston, A. D. Pressey and T. Kendrick, "Collaboration and collective learning:networks as learning organisations," Journal of Business & Industrial Marketing, vol. 25, no. 6, p. 478–484, 2010.
[40] FMC, "Study of the 2008 Repeal of the Liner Conference Exemption from European Union Competition Law," Federal Maritime Commission, Washington, DC, 2012.
[41] ICC, "INCO Terms," 23 07 2019. (Online). Available: https://iccwbo.org/publication/incoterms-rules-2010/.
[42] ICC, "INCOTERMS 2010," International Chamber of Commerce, 2019. (Online). Available: https://iccwbo.org/resources-for-business/incoterms-rules/incoterms-rules-2010/. (Accessed 26 10 2019).
@article{"International Journal of Mechanical, Industrial and Aerospace Sciences:79646", author = "L. Edirisinghe and P. Mukherjee and H. Edirisinghe", title = "Virtual Container Yard: Assessing the Perceived Impact of Legal Implications to Container Carriers", abstract = "Virtual Container Yard (VCY) is a modern concept that helps to reduce the empty container repositioning cost of carriers. The concept of VCY is based on container interchange between shipping lines. Although this mechanism has been theoretically accepted by the shipping community as a feasible solution, it has not yet achieved the necessary momentum among container shipping lines (CSL). This paper investigates whether there is any legal influence on this industry myopia about the VCY. It is believed that this is the first publication that focuses on the legal aspects of container exchange between carriers. Not much literature on this subject is available. This study establishes with statistical evidence that there is a phobia prevailing in the shipping industry that exchanging containers with other carriers may lead to various legal implications. The complexity of exchange is two faceted. CSLs assume that offering a container to another carrier (obviously, a competitor in terms of commercial context) or using a container offered by another carrier may lead to undue legal implications. This research reveals that this fear is reflected through four types of perceived components, namely: shipping associate; warehouse associate; network associate; and trading associate. These components carry eighteen subcomponents that comprehensively cover the entire process of a container shipment. The statistical explanation has been supported through regression analysis; INCO terms were used to illustrate the shipping process.
", keywords = "Container, legal, shipping, virtual.", volume = "14", number = "6", pages = "238-11", }
