Cross-border online retailers rapped over shipping fees, late deliveries and damaged goods

Cross-border online retailers are under fire in Hong Kong over allegations of unclear shipping costs, additional fees, late deliveries, and goods damaged or lost in transit.

The Hong Kong Consumer Council (HKCC) says it received 243 complaints last year relating to cross-border online purchases, with disputes arising between vendor and purchaser over unexpected costs and fine print.

One recurring issue is that in order to save shipping costs, consumers often choose to group and ship the items they purchase from different online stores. When disputes arise, it is often difficult to ascertain whether the liability should fall on the online stores, online shopping platforms, transportation companies or the group shippers, the HKCC explained. 

“As the process of making claims is time-consuming and complicated, consumers often have to solely bear the loss themselves.” 

The council has urged the industry to proactively improve the quality of its services and increase its information transparency, including the package size limits, the calculation formula for additional charges, and the compensation for delay, loss or damage to shipment. 

Due to the special features of group and ship services, which involve the logistics arrangement of multiple parties, group shippers are advised to adopt appropriate measures to reduce mistakes in delivery to protect consumer interests.

The council outlined three case studies of poor practice by online shippers, detailed below: 

Case 1: Low price transparency on group and ship service and abuse of oversize surcharge

A complainant made an order for company A to ship some goods from the mainland to Hong Kong. He followed all the instructions on the company website and completed online payment of $173.70 for the shipment. On the following day, he received a telephone call from a staff of company A who demanded a surcharge of $200 because the length of the goods allegedly exceeded the standard size by 3cm. If he did not pay, the package would be returned to the seller with a handling charge imposed on the complainant. The HKCC said the customer was dissatisfied that the levy of a surcharge was not stated when he placed the order online and the staff could not clearly explain on the phone why the goods were regarded as oversized. The staff claimed that all the shipment packages were processed by machine and the system automatically calculated the required fees. As the complainant needed the goods urgently, he had no choice but to settle the surcharge payment as required.

After receiving the goods, the complainant lodged a complaint with the HKCC, arguing that the surcharge imposed by company A was neither clear nor reasonable and seeking a refund of the surcharge. Furthermore, when he received the goods, he measured the package and found it did not exceed the standard size for shipment as claimed. He then sent the photos with measurements to company A and informed the company that he had filed a complaint with the HKCC. A refund was arranged within two days. 

Case 2: Inaccurate company address caused loss of goods and follow up action was slow

Another complainant ordered two items from a US website and had the goods delivered to the designated transit warehouse of Company B to group and ship the goods back to Hong Kong. Based on her experience, the goods were expected to reach the transit warehouse within two days. However, after waiting nearly a week, the online tracking system still did not display any shipping information. The complainant kept asking Company B and was told after several contacts that the goods was mistakenly delivered to another transit warehouse. The complainant reiterated that she copied the warehouse address from Company B’s website and queried why the other transit warehouse would acknowledge receipt of goods not designated by its customers.

Company B did not respond to her queries and just claimed that it would follow up the case with the other warehouse. As there was no reply from Company B after a month, the complainant filed a complaint with the HKCC.

Two months after the council liaised with Company B, the complainant was contacted by the company and was asked to produce the purchase receipt to facilitate the company to recover the goods from the other warehouse. There was no further response from Company B after the receipt was provided. The HKCC stepped in again at which point Company B explained that the courier assigned by the online shopping platform had sent the goods to another transit warehouse by mistake. Three months after her order, the complainant finally received the goods.

Then she noticed the address of the US transit warehouse shown on company B’s website had been updated, which made her suspect that the delivery error was caused by the wrong address posted on the website. 

Case 3: Group shipper evaded liability for damage to shipment with no avenue to seek redress

A third complainant sent the items she bought online to the transit warehouse of Company C in the mainland to wait for a grouped shipment to Hong Kong. While the goods were delivered on time, the complainant found that one of the wooden hangers and its associated parts were damaged. The complainant was dissatisfied and immediately sent a photo of the damaged items as proof to Company C seeking compensation in accordance with the terms of the group-shipping service. Company C claimed it needed to compare her photo with the one taken by the transit warehouse when the goods were received so as to ascertain whether the online store or the company was liable for the damage. After several days, Company C replied that the warehouse could not locate any photos of the goods. With no further response from Company C after several weeks, the complainant lost hope and disposed of the broken hangers. Subsequently, Company C contacted the complainant and agreed to arrange compensation on the condition that she returned the damaged merchandise. The complainant therefore sought help from the HKCC.

Company C repeated in its email that return of the damaged merchandise was necessary for compensation. The complainant argued that she had immediately sent the photo of the damaged goods to company C upon receipt of the shipment and she was not told that the damaged items had to be retained and returned. The HKCC continued the conciliation efforts for several months but company C failed to respond. Finally, the complainant was advised to make a civil claim for compensation. 

Advice on group-and-ship services

The HKCC says that although group and ship works to reduce shipping costs, the quality of service largely depends on the efficiency of the various parties in the supply chain, which include the online shops, overseas warehouses and logistics companies at the destination. To avoid loss, damage or delays in group shipment, the HKCC recommends consumers consider the following tips: 

  • Before placing an order, check the pre-set standard on the size and weight of the shipment package as well as the calculation formula for shipping charges, and confirm with the online shop the package, size and weight of the product for accurate calculation of shipment cost.
  • Read carefully the terms and conditions of compensation in case of delays, and loss or damage to shipment, including whether the compensation amount is based on the actual price of the merchandise or the shipping cost, as well as whether there is any upper limit on the compensation amount.
  • When shipping relatively expensive or fragile items, consider purchasing extra logistics protection insurance and clearly understand the relevant terms and conditions. Also check with the online store to ensure that the merchandise has sufficient protective packaging and ask for a warning label, such as “Fragile, Handle With Care” to be affixed to the package.
  • Carefully inspect items as soon as they are received. Take and send photos as proof immediately to the group shippers if damages are found, together with a copy of the purchase receipt and shipment order as soon as possible. Consumers should try to retain the damaged merchandise or contact the shipper for advice if the damaged goods are not suitable for retention.

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