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March 28, 2020

Port terminals reluctant to waive demurrage charges without official notice

Business

March 28, 2020

KARACHI: Confusion persists amidst port terminals, shipping lines and importers on the issue of port demurrages and detention charges, after Minister of Maritime Affairs Ali Zaidi announced waiver of the charges till April 15, 2020, but did not issue a notification in this regard.

All Pakistan Customs Agents Association (APCAA) President Arshad Jamal said port terminals were reluctant to waive demurrage and shipping lines had not waived container detention charges.

“Minister Ali Zaidi made this announcement without meeting with the stakeholders. No notification has been issued so far, and even if (it is issued), terminal operators and shipping agents would go to the court,” Jamal said.

“The minister should take all the stakeholders, including port terminals, shipping lines and Customs agents on board, set parameters with consultation, and then issue a notification.” Zaidi announced that in order to facilitate exporters, port authorities had been advised to reduce or waive terminal, linear and demurrage charges as well as extend free time at ports.

Sara Khan at Hutchison Ports Pakistan said she had not seen any notification from the ministry advising to waive terminal charges. “However, we are already taking care of this issue on case to case basis, making decisions on merit.”

She said although sea traffic had slowed down, still the containers were piling up at their terminal. “It is all about efficiency and availability of space, which we are maintaining with the terminal operating 24/7.”

An official at DP World said no decision had been taken regarding waiver of demurrage charges so far. “There is a difference between making an announcement and officially issuing a notification,” he said.

The importers are in a fix due to the lockdown. Closure of markets has caused a serious liquidity crunch for the importers, who are unable to get their shipment documents released from banks and pay the government taxes.

Arshad Jamal said there was no recovery as markets were locked down, while government was insisting that importers pay taxes on their imported cargo and get deliveries. “Government should also impose a lockdown on all non-essential imports. Commercial imports have piled up at the ports, and in five days, there will be no space even to ground essential goods.”