Exporters, importers write to Govt. objecting rise in shipping costs via new Gazette

A collective of business chambers and associations have made a joint representation to the Minister of Ports, Shipping and Aviation Nimal Siripala De Silva stating that these newly introduced provisions under the Extraordinary Gazette Notification No. 2304/24 violate the principles of market forces. 

“This adversely impacts the cost of living and competitiveness of industry overall in terms of both imports and exports,” it was stressed. 

The Daily FT on 27 October exclusively raised this issue (see https://www.ft.lk/top-story/Fresh-storm-brewing-in-shipping-industry-over-new-cost/26-741333).

The chambers and associations include the Joint Apparel Association Forum (JAAF), National Chamber of Exporters, Sri Lanka Association of Manufacturers and Exporters of Rubber Products, Sri Lanka Shippers’ Council, Tea Exporters’ Association, Sugar Importers’ Association and Essential Food Commodities Importers and Traders Association

The main concerns detailed in the letter to the Minister of these anti-competitive and non-transparent regulations are: Increased costs due to intervention by the authorities in price fixing; Removal of the negotiation capability of private parties as service providers and service receivers and Misinterpretation relating to freight and other costs.

Given that industry is a major contributor to the country’s economy adding impetus to managing the trade balance, the Chambers and Associations are urging the government to consider justifiable corrective action for the newly proposed amendments to Act no. 10 of 1972, which would create a regulatory environment where competition and principles of market forces are upheld.

The Extraordinary Gazette Notification 2303/24 dated 20 October 2022 amended the Licensing of Shipping Agents, Freight Forwarders, Non-vessel Operating Common Carriers and Container Operators Act No. 10 of 1972.  

The amendments include a change in the existing structure of charges with maximum delivery order fees revised upwards for full container load and less than container load import shipments.  The ultimate import consignee will be charged $ 8 per cubic meter as cost recovery fee with washing charges, de-stuffing charges and transport cost being included in the cost recovery fee