Shippers protest FEFC rate rises
Vietnamese shippers have protested a scheme by the Far Eastern Freight Conference (FEFC) which groups giant container shipping lines like Maersk Line (pictured), MSC, and CMA CGM, to collect terminal handling charges (THC) from May 1.
They insisted on delaying the scheme by eight months to early next year.
The Vietnam Chamber of Commerce and Industry (VCCI) representing Vietnam's export associations will put in more efforts to ask the Far Eastern Freight Conference (FEFC) to delay the scheme until January 1, 2008, an official said.
Tran Huu Huynh, head of the VCCI's Legal Department, who is also a member of the THC negotiation council, said local exporters had urged VCCI to negotiate with FEFC to postpone the scheme to help them stabilize export activities.
"In a meeting between the THC negotiation council and seven local export associations and government officials last week, these associations asked the VCCI to forge a deal with FEFC on the postponement,'' Huynh said.
The seven associations represent exporters of mainly agricultural products, electronics, and textile and garments. Representatives of these associations said they needed time to fulfill all export contracts signed for the year to help their member enterprises stabilise export activities, Huynh said.
FEFC, which groups giant container shipping lines in the world like Maersk Line, MSC, and CMA CGM, has sought to collect the charge separated from the transport cost at US$65 a TEU and $98 a FEU, effective May 1.
According to experts, the application of the THC scheme would have adverse impacts on the cost of export goods and thus the competitiveness. It may also cause conflicts of interest among the involved parties, including shipowners, port operators and shipping companies.
Therefore, VCCI asked local enterprises and associations to unite their strength for a common voice in protecting their right and benefit.
VCCI has sent a letter to FEFC stating that the shipowners must not unilaterally apply the THC scheme until after the two sides reach an agreement.
Since 1994, another association, Intra-Asia Discussion Agreement (IADA) has many times announced it would collect THC from Vietnamese enterprises, but the collection has not been carried out due to opposition from local firms.
After many negotiations with Vietnam's THC negotiation council, which failed to reach a common voice, on March 20, IADA sent a letter to VCCI announcing that it would apply the THC in Vietnam as of June 1 this year. The THC levels to be applied are $60 per TEU and $90 per FEU.
According to IADA, THC includes the charges for container handling and storage fees.
IADA and FEFC are the two big shipowners groups which carry most of the containers to and from Vietnam, including large shipping lines such as Maersk Line, Mitsui OSK Lines, CMA CGM, ANL Container Lines, APL, Hapag-Lloyd.
These shipowner groups said the THC introduction is a commercial issue that intends to bring Vietnamese shipping business practices in line with norms being applied in all other Asian countries.
They insisted on delaying the scheme by eight months to early next year.
The Vietnam Chamber of Commerce and Industry (VCCI) representing Vietnam's export associations will put in more efforts to ask the Far Eastern Freight Conference (FEFC) to delay the scheme until January 1, 2008, an official said.
Tran Huu Huynh, head of the VCCI's Legal Department, who is also a member of the THC negotiation council, said local exporters had urged VCCI to negotiate with FEFC to postpone the scheme to help them stabilize export activities.
"In a meeting between the THC negotiation council and seven local export associations and government officials last week, these associations asked the VCCI to forge a deal with FEFC on the postponement,'' Huynh said.
The seven associations represent exporters of mainly agricultural products, electronics, and textile and garments. Representatives of these associations said they needed time to fulfill all export contracts signed for the year to help their member enterprises stabilise export activities, Huynh said.
FEFC, which groups giant container shipping lines in the world like Maersk Line, MSC, and CMA CGM, has sought to collect the charge separated from the transport cost at US$65 a TEU and $98 a FEU, effective May 1.
According to experts, the application of the THC scheme would have adverse impacts on the cost of export goods and thus the competitiveness. It may also cause conflicts of interest among the involved parties, including shipowners, port operators and shipping companies.
Therefore, VCCI asked local enterprises and associations to unite their strength for a common voice in protecting their right and benefit.
VCCI has sent a letter to FEFC stating that the shipowners must not unilaterally apply the THC scheme until after the two sides reach an agreement.
Since 1994, another association, Intra-Asia Discussion Agreement (IADA) has many times announced it would collect THC from Vietnamese enterprises, but the collection has not been carried out due to opposition from local firms.
After many negotiations with Vietnam's THC negotiation council, which failed to reach a common voice, on March 20, IADA sent a letter to VCCI announcing that it would apply the THC in Vietnam as of June 1 this year. The THC levels to be applied are $60 per TEU and $90 per FEU.
According to IADA, THC includes the charges for container handling and storage fees.
IADA and FEFC are the two big shipowners groups which carry most of the containers to and from Vietnam, including large shipping lines such as Maersk Line, Mitsui OSK Lines, CMA CGM, ANL Container Lines, APL, Hapag-Lloyd.
These shipowner groups said the THC introduction is a commercial issue that intends to bring Vietnamese shipping business practices in line with norms being applied in all other Asian countries.