Archives For International Shipping

ZIM lines

ZIM, an Israeli container shipping company, has successfully completed a blockchain document exchange pilot for paperless bills of lading using blockchain-based software from Wave to send a document that acknowledged receipt of cargo for shipment.

Wave connects all members of the supply chain to a decentralized network and allows them a direct exchange of files.

During the trial, all participants issued, transferred and received original electronic documents using Wave’s application, which manages ownership of documents on the blockchain to eliminate disputes, forgeries and unnecessary risks.

The containers, shipped by Sparx Logistics from China to Canada, were delivered to the consignees “without a hitch”, reported ZIM in an announcement about its breakthrough.

ZIM said that it is “convinced” that the blockchain technology and the Wave application is “the solution that will drive the trade to the digital era”.

The new blockchain-based system developed by Wave uses distributed ledger technology to ensure that all parties can issue, transfer, endorse and manage shipping and trade related documents through a secure decentralized network.

Wave’s application is free for shippers, Importers and Traders and requires no IT or operational changes.

Source: Port Technology (20 Nov, 2017 )

Advertisements

Hamburg Sud_1

Durban-based Hamburg Süd is the first shipping line – and the first South African Revenue Service (Sars) client – to be granted exemption from the requirement to submit paper manifests to local customs branches, thus becoming the first fully electronic cargo reporter.

While the electronic reporting of pre-arrival manifests to Sars has been a requirement since August 2009, shipping lines are, to date, still required to present pre- and post-arrival paper manifests to local customs branches in order to account for cargo. This was also because the data accuracy of electronic submissions varied significantly between different reporters.

Sars’ implementation of the new Manifest Processing (MPR) system in June 2016, provided industry with the mechanism to also report acquittal manifests electronically. Additionally, the system is able to match customs clearances to their corresponding cargo reports (manifests) in order to identify instances of non-reporting.

Three months after MPR was introduced, the facility for full paperless cargo reporting was made available to shipping lines and airlines who submit both pre-arrival and post-arrival manifests to Sars electronically; submit complete sets of manifests without any omissions; achieve a reporting data accuracy rate of 90% or higher in respect of both their pre-arrival and acquittal manifests reported for each of the three months preceding any application for exemption from paper reporting requirements; and can maintain that level consistently.

A significant benefit to carriers reporting electronically is the cost-saving of hundreds of thousands of rands spent per year in the paper and administrative costs associated with submitting paper manifests to Sars offices. The process is now more efficient allowing for improved risk management, security and confidentiality.

“Hamburg Süd’s core business strategy is to deliver a premium service to our customer, and to achieve this, compliance is a core driver. SARS paperless reporting is in line with our compliance and sustainability strategy,” said Jose Jardim, general manager of Hamburg Süd South Africa.

For Customs, the mandatory submission of cargo reports forms a significant part of the new Customs Control Act (CCA) in order to secure and facilitate the international supply chain.

With the impending implementation of Reporting of Conveyances and Goods (RCG) under the CCA – targeted for 2018 – carriers of internal goods in the sea and air modalities are urged to follow Hamburg Süd’s example and ensure that they become compliant in good time so that they can enjoy a smooth transition to the new legal dispensation.

Paperless cargo reporting would bring an end to one of the last remaining paper-based processes in customs while further contributing to the expedited processing of legitimate trade through an enhanced and integrated risk management environment.

According to a Sars spokesman technical stakeholder sessions to implement the reporting requirements introduced by the new Customs Control Act are due to commence soon and carriers and other supply chain cargo reporters are urged to attend in order to ensure they adapt their systems in good time.

Source: adapted from FTW Online, Venter. L, “German shipping line first Sars client to become fully electronic reporter”, September 14, 2017.

Ghana
Deputy Minister of Trade and Industry, Mr. Carlos Ahenkorah, says Ghana a signatory to the WTO Trade Facilitation Agreement is too small a country to have two Single Window operators.

He challenged the pioneer and only single window operator, Ghana Community Network Services Limited (GCNet) to speedily re-double its efforts in actualising the full breadth of Single Window operations in the country.

He recalled GCNet’s drive to automate trade facilitation and port clearance processes in the country and the difference that brought to trade and port operators.

He praised the Ghana Integrated Cargo Clearance Systems (GICCS) deployed by GCNet as efficient and robust enough to deliver on any valuation needs and address any bottlenecks in the overall clearance systems at the ports to deepen trade facilitation and enhance revenue mobilisation.

He noted that GCNet had taken too long in securing the manifest, the seed document in clearance processes at the ports from source, a situation that may have encouraged other operators to exploit the loophole to try to secure that right from the International Air Transport Association.

The Deputy Trade Minister, however, noted that if GCNet had connected Maersk Lines to transmit its manifest into the Ghana Customs Management System (GCMS) over the past three years then there was no way that it could not oblige other carriers to emulate that example and ensure that both air and sea manifest are transmitted expeditiously.

He also urged GRA (Customs Division) as the statutory body to assist GCNet to get all other carriers to do so with dispatch going forward.

Mr. Ahenkorah also charged GCNet to remain committed to their tenets of innovation and service delivery and work harder to expand the scope of its TradeNet Single Window platforms in order to ward off any superfluous and duplicitous competition.

On his part, the Chief Executive Officer of the Ghana Shippers Authority, Dr. Kofi Mbiah, challenged Government to be bold to speedily resolve critical issues militating against the full actualisation of Single Window implementation in the country.

He said Ghana having been acknowledged as a pioneer in Single Window operations by international bodies like the World Bank and a number of countries having undertaking familiarization visits to Ghana to learn about the GCNet experience.

Dr. Mbiah noted that in as much as there was the need for collaboration between GCNet and other operators, it was also extremely important to define the parameters of engagement to create a level playing field for all players in the trade facilitation and revenue mobilisation eco-system.

Welcoming guests earlier to the event, the Executive Chairman of GCNet, Dr. Nortey Omaboe, noted that as a Public Private Partnership (PPP) conceived since its inception, the model over time had proved to be the most effective way of executing such a national mandate to support revenue mobilisation by Government, foster trade facilitation and enhance business competitiveness.

Dr. Omaboe observed that Government’s quest for increased revenue in an environment of reduced taxes to stimulate private sector growth meant greater focus on GCNet to come up with new initiatives to support revenue mobilisation efforts.

He, therefore, outlined a number of initiatives that GCNet had proposed to Government to enhance revenue mobilization.

These include the need to improve upon the valuation of consignments, the need to invoke bonds for transit goods that do not exit the country after 14 days and the review of the paltry charges currently imposed, ensuring that warehoused goods are ex-warehoused within the stipulated time periods.

Also, tighter control of free zone operations and the duty and tax exemptions granted thereon, the assignment of all newly registered taxpayers to relevant GRA Tax Offices and ensuring they file tax returns, etc.

Dr. Omaboe however expressed concerned about non-clarity in the role of some entrants in the trade facilitation and revenue mobilisation space following the cessation of the destination inspection companies and called for urgent steps to address the worrying development; and its inherent duplications and hence unnecessary cost to Government.

He was confident that what he termed ‘unnecessary complication’ would eventually be resolved mindful of the consideration that the interest of the country should remain paramount and be protected.

Dr. Omaboe assured guests that GCNet was poised for further growth and development in the years ahead as it leverages upon its continuous innovations in deploying systems that bring greater value to the Government and people of Ghana. Source: Ghana News Agency, Two Single Window Operators too much for Ghana, April 19, 2017

Customs_&_Central_Excise_DKBThe Indian Customs department (CBEC) has allowed self-sealing procedure as of 1 October for containers to be exported, as it aims to move towards a ‘trust based compliance environment’ and trade facilitation for exporters.

In a circular to all Principal Chief Commissioners, the Central Board of Excise and Customs (CBEC) said exporters who were availing facility of sealing at the factory premises under the supervision of customs authorities will be automatically entitled for self-sealing facility.

It said that permission once granted for self-sealing at an approved premise will remain valid unless withdrawn. However, in case of change in the premise, a fresh approval from Customs department will be required.

“The new self-sealing procedure shall come into effect from October 1, 2017. Till then the existing procedure shall continue,” the CBEC said.

It asked field officers to notify a Superintendent-rank officer to act as the nodal officer for the self-sealing procedure.

The officer will be responsible for coordination of the arrangements for installation of reader-scanners.

Earlier in July, the CBEC had said it will introduce the system of self-sealing by 1 September , as against the practise of sealing of containers under the supervision of revenue officials.

However, the CBEC now said that exporters can self-seal containers using the tamper proof electronic seals from 1 October 2017.

Under the new procedure, the exporter will have to declare the physical serial number of the e-seal at the time of filing the online integrated shipping bill or in the case of manual shipping bill before the container is dispatched for the port.

The exporters will directly procure RFID seals from vendors.

“In case, the RFID seals of the containers are found to be tampered with, then mandatory examination would be carried out by the Customs authorities,” the CBEC said.

From October 1, the exporters will need to furnish e-seal number, date of sealing, time of sealing, destination customs station for export, container number and trailer track number to the customs authorities.

In a circular in July, the CBEC had said it endeavours to create a trust based environment where compliance with laws is ensured by strengthening risk management system and Intelligence setup of the department.

Accordingly, CBEC has decided to lay down a simplified procedure for stuffing and sealing of export goods in containers. Source: The India Times > Economic Times, 5 September 2017.

Luc Castera founder of Octopi, a tech company in the logistics industry, has recommended a series books to broaden culture and learning about the shipping industry. Ninety percent of everything around you was carried over on a shipping container before it reached you. It’s the industry that puts food in your plate, clothes on your back and enables the success of e-commerce globally. Yet, very few companies are trying to solve the hard problems facing this industry, says Octopi co-founder Luc Castera. If you are new to this industry, or if you have been working it in for 20 years and believe that learning should be constant, Luc highly recommends the following books.

1. The Docks by Bill Sharpsteen

Focusing on the Port of Los Angeles, The Docks delves into the unseen world of this highly successful enterprise. Author Bill Sharpsteen paints a picture of the port’s origins, zeroing in on the people that helped contribute to its economic prosperity. While Sharpsteen emphasizes the Port’s success, he also talks about its vulnerability with security and labor, while including personal stories from industry insiders. One perspective he includes is that of one of the first women longshoremen. The Docks demonstrates the energy behind this incredible port through dramatic photographs and personal perspectives.

2. The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger by Marc Levinson

The Box tells the story of the container and its beginnings. What started as a simple box, changed the future of the shipping and transportation industries collectively. The container idea was slow on the uptake and economist Mark Levinson tells the story of how, after a decade of struggle, it came to fruition and changed the transport industry for good. Levinson includes key notes about how the inclusion of the “box” brought some ports back to life, whereas others suffered with its implementation. Thanks to this extraordinary box, costs were cut in the transport sector and the global economy is able to thrive, today.

3. Port Management and Operations by Maria G. Burns

Port Management and Operations has created a manual filled with insights and strategies into the world of shipping. Through examination of port management practices on a global level and deconstructing them on commercial and technological levels, this manual provides readers with a new set of skills and perspective. Port Management and Operations touches on 4 themes: “Port Strategy and Structure, Legal and Regulatory Framework, Input: Factors of Production, and Output and Economic Framework.” This book also identifies strategies and provides insight into the future of shipping.

4. Port Business by Jurgen Sorgenfrei

For veterans or those just starting out in the shipping industry, this book breaks down the meaning of ports and explains the role they play in the global supply chain. With globalization, exporting has increased exponentially, and the shipping market is changing. Port Business breaks down and analyzes the struggles for small to mega-sized ports, providing insight into the industry’s future.

5. The Travels of a T-Shirt in the Global Economy by Pietra Rivoli

Through the perspective of a T-shirt, this narrative has a lot to say about globalization and international business. Following a T-shirt from Texas to Africa, author Pietra Rivoli reveals political, cultural, economic, and moral issues associated with international business. The reader is challenged to view trade through an unconventional perspective while evaluating the complex layers of business crossing borders.

6.The Shipping Man by Matthew McCleery

Matthew McCleery tells the story of a hedge fund manager turned shipping man. After deciding to buy a ship on a whim, Robert Fairchild enters the complex world of shipping. A stark contrast to his New York life, Fairchild embarks on a journey where he learns about everything from Somali pirates to the wealthy folk of Wall Street. Though he ends up losing his hedge fund, he gains the title of shipping man along with the knowledge associated with it.

7. Ninety Percent of Everything: Inside Shipping, the Invisible Industry That Puts Clothes on Your Back, Gas in Your Car, and Food on Your Plate by Rose George

Ninety Percent of Everything unveils the invisible world of shipping to the commoner’s eye. Author Rose George divulges the secrets of the “invisible industry” through her incredible adventure sailing from southern England to Singapore. Five weeks aboard The Maersk Kendal and countless miles later, George lets readers into the shipping industry from the perspective of someone with little experience. Her objective in writing this tell-all piece is to shed light on the otherwise closed-door industry and to inform consumers about the shipping life and all that entails.

Published by Maritime Executive, Luc Castera, August 23, 2017

TEU Token

The creators of a new industry-specific digital currency that shippers can use to book ocean shipments say so-called “cryptocurrency” could help reduce carrier overbooking and shipper no-shows, which cost the industry some $23 billion annually.

The Hong Kong-based 300 Cubits recently introduced the TEU, not the container unit but rather a digital dollar that replaces traditional currencies as the deposit for shipment bookings, providing greater visibility to the booking process and allowing users to penalize bad behaviour. Whereas other tech startups have introduced digital management platforms to achieve the same goals, 300Cubits’ founders say they’re offering something different: not a place for transaction, but a means of transaction.

The company introduced the new TEU crypto currency to the market, putting some up for sale and giving others away to container lines and shippers “who actively promote the tokens for early adoption.” The TEU tokens are blockchain-based, which means they are tethered to a decentralized, distributed digital ledger used to record transactions across many computers so that the record cannot be altered retroactively.

Blockchain is a largely back-end technology, which means there’s very little change for the user, both shipper and carrier, according to Johnson Leung, a longtime shipping finance analyst formerly with Jefferies who founded 300Cubits with his partner Jonathan Lee.

“The biggest change is the acceptance of TEU tokens as a booking deposit, which is a more commercial decision than a technical call,” Leung told, “We do not plan on a substantial change in terms of user interface experience other than having one more option for the user to choose whether to use TEU tokens and the amount to put it before the shipper clicks on the book button.”

The tokens were named TEU to honor, in a way, the classical unit of measurement for container shipping, said Leung.

“TEU is a kind of a classical unit for container shipping that is getting less and less used,” Leung said. “We just think that the people in the industry would appreciate the name as TEU when naming something that could be the money for the industry.”

In an era marked by the buzzword “disruption,” Leung was clear that TEU tokens are not disrupting any existing system or process in the container shipping industry. TEU tokens are like an industry-specific bitcoin, another blockchain-based cryptocurrency. Put simply, Leung said, “We play part of what the dollar does today in container shipping.”

According to a white paper prepared by the company, once TEU tokens are used to book shipment their value could be lost if a customer does not turn up with cargo or a carrier does not load cargo according to a confirmed booking.

Trust, or lack thereof, is the biggest pain point in the container shipping industry, according to 300 Cubits.

“Unlike ticket booking in airlines, customers in container shipping do not bear any consequence for not showing up for bookings. Industry people complain the lack of trust between liners and customers,” the company said in a statement. The TEU token can change that.

While it is aimed at tackling overbookings and no-shows and providing greater visibility into the container shipping industry, 300Cubits should not be confused with other tech firms attempting to accomplish the same feat through different avenues. Leung’s company only provides the means of transaction. It does not provide the actual space for where carriers and shippers can transact, like the New York Shipping Exchange, an online portal through which carrier cargo space can be booked and which also monitors whether the booking is fulfilled by shipper and carrier.

According to Leung, the container shipping industry is a $150 billion industry that has been in “constant distress” since the economic crisis of 2008. Subtle technological innovations, like digital currencies and digital marketplaces to use them, are going to be the means to ease that volatility.

Frequently Asked Questions regarding TEU – 300cubits.tech

300Cubits White Paper – 300cubits.tech

Source: www.dailyshippingtimes.com, 3 August 2017.

image001

A new collapsible 20ft container, which is currently in development, promises to save operators both money and space both at the terminal and in the supply chain, according to Port Strategy.

Navlandis’s ZBox claims to be able to take the place of empty containers, which take up around 25% of sea traffic, slashing both logistics and transportation costs.

This is because five folded units can fit into the space occupied by a current standard container potentially reducing operating costs by up to 50% and CO emissions by up to 20%.

This container has the same strength as conventional containers. In addition, it can be handled with the same machinery at all freight ports and with minimum human resources, which will make operating costs much more competitive.

The technology is still at prototype stage but reportedly has the backing of the Port of Valencia. Navlandis said that a good number of shipping companies have shown interest too.

Navlandis said that the 20-foot container complies with all ISO and CSC certifications, ensuring all loading, resistance and watertightness requirements of the logistics industry, with the same dimensions as a standard container. In addition, it is manufactured with the same parts as the standards require. Source: Port Strategy

Blockchain

T-Mining is currently working on a pilot project that will make container handling in the port of Antwerp more efficient and secure. Using blockchain technology, processes that involve several parties – carriers, terminals, forwarders, hauliers, drivers, shippers etc. – are securely digitised without any central middleman being involved.

Just getting a container from point A to point B frequently involves more than 30 different parties, with an average of 200 interactions between them. Given that many of these interactions are carried out by e-mail, phone and even (still, nowadays) by fax, paperwork accounts for up to half of the cost of container transport.

“We aim to do something about this,” says Nico Wauters, CEO of T-Mining. This Antwerp start-up has developed a solution for a recognised problem in the port. When a container arrives in the port it is collected from the terminal by a truck driver or shipper. To ensure that the right person picks up the right container a PIN code is used. However, the PIN code is transmitted via a number of parties, which of course is not without risk. Somebody with bad intentions can simply copy the PIN code, which naturally can cause great problems.

“We have developed a very secure solution for this,” explains Nico Wauters. “Currently, when we want to transfer a valuable object we generally make use of a trusted intermediary to carry out the transfer. For instance, when you want to sell a house the notary not only carries out all the paperwork but also ensures that the money lands safely in your bank account while the buyer receives full title to the property, without any unpleasant surprises for either party. But this intermediary naturally does not work for free, and furthermore the additional step causes extra delay.”

The blockchain solution overcomes these issues, permitting safer and faster transfer of valuable objects, fully digitally and without a middleman. “With our blockchain platform the right truck driver is given clearance to collect a particular container, without any possibility of the process being intercepted. Furthermore our blockchain platform uses a distributed network, so that the transaction can go ahead only if there is consensus among all participating parties, thus excluding any attempts at fraud or undesired manipulations.”

A pilot project is currently running in the port of Antwerp with a limited number of parties. “We want to test whether it all works smoothly in practice,” says Nico Wauters. “Together with PSA, MSC, a forwarder and a transporter, we ensure secure handling of the first containers on our blockchain platform. Thanks to the City of Antwerp we even have an office in Singapore where we are working hard to introduce our solution there too. Our ambition is to serve the first paying customers by the end of this year,” Nico Wauters concludes. Source: Port of Antwerp

American Shipper

This year’s American Shipper’s benchmark report examines the extent to which freight buyers rely on the art of negotiation versus the technological tools to refine the procurement process. It also looks at the background dynamics confronting procurement professionals to show why investment in technology is so important. Visit AmericanShipper.com – requires registration to download!

It’s not an option for shippers and 3PLs to ignore the data that’s washing over the logistics industry anymore. And respondents to American Shipper’s most recent Transportation Procurement Benchmark Study, The Art and Science of Buying Freight, recognize that as much as anyone.

Only one quarter of freight buyers feel their organizations are above average when it comes to procurement technology. Nearly half admit they are still using predominantly spreadsheets and email to conduct procurement across modes and regions. Two-thirds are still reliant on EDI. Source: americanshipper.com

THE NEW YOUGrowing electronic commerce (E-Commerce) has provided unparalleled opportunities for and has become a game changer in the international trade arena. It has revolutionized the way businesses and consumers are selling and buying goods with wider choices, advanced shipping, payment, and delivery options.  At the same time, E-Commerce, in particular Business to Consumer and Consumer to Consumer (B2C and C2C) transactions, is presenting several challenges to governments and businesses alike.

The WCO Working Group on E-Commerce (WGEC) together with its four Sub-Groups is steadily progressing with the four identified work packages, namely Trade Facilitation and Simplification of Procedures, Safety and Security, Revenue Collection, and Measurement and Analysis with a view to develop recommendations/guidelines on cross-border E-Commerce from a wider facilitation, security or revenue perspective, to collect and disseminate good practices/initiatives, and to enhance/update related WCO instruments and tools.

Given the current focus of the WCO Members and the private sector on this topic, the 215th/216th Sessions of the Permanent Technical Committee (PTC) held a whole day dedicated session on E-Commerce on 5 April 2017. During the ‘E-Commerce Day’, the delegates were provided an update with the work done thus far, as well as, the envisaged work by the four Sub-Groups on respective work packages. A number of valuable suggestions were provided by delegates from policy, business process, and operational perspectives to further enhance the WCO E-Commerce Work Programme with tangible and practical deliverables for providing a concerted and effective response to this growing channel of trade.

In addition, four thematic workshops relating to different dimensions of E-Commerce were organized by the Sub-Groups’ Co-Leads together with other partners. Through these workshops, some interesting facets of e-commerce were explored in detail and a number of interim recommendations were made concerning facilitation, risk management, safety and security, revenue collection, and associated capacity building through enhancement partnerships with all e-commerce stakeholders and augmented public awareness and outreach programmes.

In the course of the panel sessions, a number of collaboration success stories were identified, and they will be captured more formally and shared with interested parties, through the WCO webcorner.

The WGEC Sub-Groups will continue carrying out further work and a consolidated set of interim recommendations will be presented to the July 2017 Sessions of the WCO Policy Commission and Council. Source: WCO

For thousands of years, maritime authorities have relied on tip-offs, patrols, investigations and random inspections to find smuggled goods. Today they have a variety of additional methods at their disposal, and one of the most promising is also the most intuitive: looking at every vessel’s historical behavior.

Israeli firm Windward was founded to collect, vet and analyze AIS, along with a variety of other commercial data sources on maritime traffic. Just having access to the massive quantity of data that the world’s fleet generates is not sufficient: it could take weeks for a human operator to sift through the records of just a few hundred ships, and law enforcement agencies need actionable intelligence in real time.

This is where Windward excels. Its system uses proprietary algorithms to find specific ships that may be involved in illicit activity based on a number of “red flag” behaviors. Loitering just off of a village or an uninhabited bay may be a sign that a vessel is engaged in tendering goods or passengers from shore. Similarly, when a ship turns off its AIS transmitter or changes its AIS reporting name near smuggling hotspots, it may be taking on contraband. And a ship with a well-established trading pattern that suddenly heads to a troubled region may be engaged in a new (and not entirely legitimate) line of business.

These behaviors are obvious when Ami Daniel, Windward’s CEO and co-founder, walks through a few examples in a live presentation. The novel development isn’t the signal pattern – it is the fact that his firm can automatically find it, without knowing which ships to examine in advance. It doesn’t matter if a vessel is operated by a reputable company or a known North Korean front – Windward’s system analyzes records for the entire fleet, and if a vessel looks suspicious, it gets flagged.

A few cases illustrate the potential of this approach. In Windward’s best-known example, a Cyprus-flagged reefer with a history of trading between Northern Europe and West Africa headed to a port in Ukraine – well outside its normal pattern. It returned towards the Strait of Gibraltar, but before passing through to the Atlantic, it lingered off of Algeria and Morocco for 12 days. It turned its AIS on and off multiple times in busy shipping lanes during this loitering period. Windward notes that this region is at high risk for the smuggling of arms and narcotics.

After passing through the Strait of Gibraltar, the vessel headed north towards Scotland, where it arrived on January 14. It loitered again for half a day in a small bay off the isle of Islay – an area without a port for a 4,200 dwt ship. Windward’s system flagged this behavior as a potential sign of a smuggling drop-off, though it is also possible that the ship anchored up to wait out foul weather or to time its arrival.

This particular case made headlines in the UK when Windward told media that hundreds of vessels with suspicious records entered British waters in the first two months of 2017. The story was picked up by the Global Mail, Sky News and the Daily Record, and Scottish politicians called on the authorities to look into the matter: “This requires investigation, certainly by the police and, I suspect, by the security authorities to clarify what’s going on,” said member of Scottish Parliament Mike Russell.

These results capture attention, and Daniel says that the firm is marketing the system’s abilities to multiple government agencies. The kind of smuggling/trafficking behavior that it can identify is often associated with organized crime and the financing of terrorism, so it has a great deal of appeal for intelligence applications as well as maritime security / maritime domain awareness. He suggests that for now, commercial users (traders, brokers and others) are not a target market, nor does he foresee branching out into similar offerings for trucking or air freight. Windward does one thing well – very well – and Daniel expects that it will invest in its core strength for some time to come. Original article published in The Maritime Executive.

International trading involves many participants all around the globe. These participants may not necessarily have the needed trust of all parties, especially at the initial stages, when newcomers join the trade. Blockchain can provide the needed trust to capture key transaction activities as immutable records, as well as storing and sharing encrypted legal and financial documents.

Visibility of transaction records and documents are tightly controlled by blockchain, permitting sharing only among entrusted and allowed parties. In this demo, IBM demonstrates how blockchain may support such an application.

The blockchain solution being built by the two companies is expected to be made available to the ocean shipping industry later this year, according to a joint statement from International Business Machines Corp and the container unit of A.P. Moller-Maersk. It would help manage and track the paper trail of tens of millions of shipping containers globally by digitizing the supply chain process from end to end.

This will enhance transparency and make the sharing of information among trading partners more secure.

When adopted at scale, the solution based on the Linux Foundation’s open source Hyperledger platform has the potential to save the industry billions of dollars, the companies said.

“Working closely with Maersk for years, we’ve long understood the challenges facing the supply chain and logistics industry and quickly recognized the opportunity for blockchain to provide massive savings when used broadly across the ocean shipping industry ecosystem,” said Bridget van Kralingen, senior vice president, industry platforms, at IBM.

IBM and Maersk intend to work with a network of shippers, freight forwarders, ocean carriers, ports and customs authorities to build the new global trade digitization product, the companies said.

The product is also designed to help reduce or eliminate fraud and errors and minimize the time products spend in the transit and shipping process.

For instance, Maersk found that in 2014, just a simple shipment of refrigerated goods from East Africa to Europe can go through nearly 30 people and organizations, including more than 200 different communications among them.

The new blockchain solution would enable the real-time exchange of original supply chain transactions and documents through a digital infrastructure that connects the participants within the network, according to IBM and Maersk. Source: Reuters

containeryard

The U.S. National Retail Federation (NRF) and a coalition representing retailers, manufacturers, truckers, transportation intermediaries and other business groups has asked the Federal Maritime Commission to set new policy preventing terminal operators and ocean carriers from charging unfair fees when uncontrollable incidents such as storms and strikes keep cargo from being picked up from ports on time.

“Recent events involving port congestion, labor strife, an ocean carrier bankruptcy, inclement weather and other disruption events have had crippling effects on U.S. ports and the stakeholders who rely on the efficient movement of goods,” the 25-member Coalition for Fair Port Practices said in a petition filed with the commission. During the incidents, storage and use charges have continued “even though shippers, consignees and drayage providers had no control over the events that caused the ports to be inaccessible and prevented them from retrieving their cargo or returning equipment.”

Cargo owners and trucking companies are normally given a certain number of free days to pick up containers of imported goods from ports after they have been unloaded from ships. After that, they can be charged demurrage, a fee intended to ensure that containers are removed quickly and efficiently. In addition, detention and per diem fees can be charged if the cargo containers and chassis used to haul them are not returned within a specified time.

That system was thrown into disarray this fall when the bankruptcy of South Korea’s Hanjin Shipping left cargo owners unable to pick up containers on time and later prevented them from returning containers and chassis, says the NRF.

Delays have also occurred during other port disruptions cited in the petition, including the 2014-2015 labor slowdown at West Coast ports and Hurricane Sandy on the East Coast in 2012.

The coalition said millions of dollars in fees have been charged during such incidents:

  • A retailer was charged $80,000 because it took up to nine days to retrieve containers when only four free days were allowed.
  • A trucking company was charged $1.2 million after long lines at New York and New Jersey ports kept it from returning containers on time.
  • A transportation company was charged $1.25 million after containers it tried to return were turned away at West Coast ports. The amount was eventually reduced to $250,000 but only a year after the company was forced to pay the fees upfront.

“Shippers, consignees and drayage providers do not create and cannot avoid these events,” the group said. “They cannot control the weather. They do not choose the terminals that carriers use. They are not parties to port labor collective bargaining agreements.”

The federal Shipping Act requires that the fees and related practices be “just and reasonable.” The petition asks the FMC to adopt a policy that would require free days to be extended during times of port congestion, weather-related events, port disruptions or delays caused by government actions or requirements beyond the control of the parties picking up or returning containers. Demurrage and similar fees charged during such incidents would be declared “unreasonable.” In some cases, “compensatory” fees could be charged provided that they did not exceed actual storage or equipment use costs. The proposed policy would apply to ocean carriers and marine terminal operators. Source: Maritime Executive

bascap

Leaders from global shipping firms, freight forwarders, brand owners whose products are counterfeited and industry organizations representing both industries signed a joint Declaration of Intent to Prevent the Maritime Transport of Counterfeit Goods in Brussels last week.

The event marked the first time the global shipping industry and brand owners have made a public commitment to work together to stop the transport of counterfeit goods on shipping vessels.

Initial signatories include the leading global shipping firms and freight forwarders and ten major multinational brand manufacturers, along with the International Federation of Freight Forwarders Associations (FIATA), and the International Chamber of Commerce’s (ICC) Business Action to Stop Counterfeiting and Piracy (BASCAP) and Commercial Crime Service (CCS).

More transporters, brand owners and their industry associations are expected to join the voluntary initiative as awareness grows.

According to the United Nations Office on Drugs and Crime, about 90 percent of all international trade is moved around the world in more than 500 million containers on 89,000 maritime vessels. While this represents approximately 90 percent of all international trade, UNODC says that less than two percent of these containers are inspected to verify their contents. This results in enormous opportunities for criminal networks to abuse this critical supply chain channel to transport huge volumes of counterfeit products affecting virtually every product sector.

According to a recent OECD/EUIPO report, $461 billion in counterfeit goods moved through international trade in 2013, with almost 10 percent being shipped on maritime vessels.

Maersk Line and CMA CGM Group, two of the largest global transport companies with approximately half of all global shipping, and Kuehne and Nagel and Expeditors, two of the leading freight forwarding and logistics companies with total revenues of more than $27 billion, were the first in their industries to sign the Declaration.

The non-binding Declaration acknowledges the “destructive impact” of counterfeits on international trade. It calls on the maritime transport industry to address it “through continuous proactive measures, and corporate social responsibility principles.” The Declaration includes a zero tolerance policy on counterfeiting, strict supply chain controls and other due diligence checks to stop business cooperation with those suspected of dealing in the counterfeit trade.

This commitment paves the way for new voluntary collaboration programs between intermediaries and brand owners to stop abuse of the global supply chain by counterfeiters.

“We are proud to be among the first in our industry to sign this historic Declaration,” said Michael Jul Hansen, Customs and Trade Compliance Lead for Maersk Line. “Maersk has been a leader in taking steps to prevent the use of our vessels for the shipment of counterfeit and other illicit goods, and this Declaration is a reaffirmation of our intent to do everything we can to ensure our ships are counterfeit free.”

The Declaration is a direct reaction to the concerns of brand owners that vessels transporting their legitimate products were also being exploited by criminal networks to transport fake versions. This phenomenon was summarized in a landmark report on the Role and Responsibilities of Intermediaries: Fighting Counterfeiting and Piracy in the Supply Chain, published in 2015 by BASCAP. Following publication of the report, BASCAP organized a working group of its members to initiate a cross-sector dialogue with the transport industry to discuss ways to work together to find voluntary solutions. Source: Maritime Executive 

shutterstock_132894758

News 24 reports that the Competition Commission on Wednesday conducted a search and seizure operation at the premises of six cargo shipping companies operating in the Western Cape and KwaZulu Natal (KZN) on suspicion of collusion and rate fixing, the body said in a statement.

“The Commission has reasonable grounds to suspect that Hamburg Sud South Africa, Maersk South Africa, Safmarine, Mediterranean Shipping Company, Pacific International Line South Africa and CMA CGM Shipping Agencies South Africa have engaged in collusive practices,” the Commission said.

The companies’ practices aimed to among other things fix the incremental rates for the shipment of cargo from Asia to South Africa, which was in contravention of the Competition Act.

According to the Commission, the search and seizure operation is conducted as part of an ongoing investigation which was initiated by the Commission based on information from a member of the public.

The companies under investigation transport cargo for import and export purposes across the globe, including South Africa. They use large metal containers as packaging crates and in-transit warehouses to store and transport general cargo such as frozen foods, garments and footwear.

The customers of these companies are mainly clearing and freight forward agents.

“South Africa is a strategic hub for the trade of goods in and out of the Southern African region. Any cartel by shipping liners in this region results in inflated prices for cargo transportation,” said Tembinkosi Bonakele, commissioner of the Competition Commission.

“Cartels of this nature increase the costs of trading in the region and render the region uncompetitive in the world markets. Such cartels have the effect of significantly derailing the economic growth of the region.”

Reuters reported that Maersk and MSC confirmed the raids and said they were cooperating with authorities. The other companies did not respond to Reuters’ requests for immediate comment.

“The fact that the SACC carries out such inspections does not mean that a company has engaged in anti-competitive behaviour,” Maersk said.

EU antitrust regulators in July accepted an offer from Maersk and 13 competitors to change their pricing practices in order to stave off possible fines. Source: News24