FBR asks ports to extend free time, waive demurrage/detention for 15 days

KARACHI: Federal Board of Revenue FBR has advised port authorities and terminal operators to extend the free period at terminals and not charge demurrage/detention for 15 days.

Pakistan is currently facing a great challenge to address the issue of spread of COVID-19 (corona virus). As a result of lock down and restriction of movement of people/vehicles, the time duration for lifting the cargo from the ports is exceeding the free time as allowed to the importers under normal course of business.

Given the current situation and to facilitate trade, FBR in a letter to port authorities and terminal operators requested that demurrage and detention charges may not be charged from the importers for a period of 15 days in addition to the free time already allowed by the port authorities.

With almost the entire world in lockdown, every segment of the shipping industry is now choking on reduced volumes of cargo and slowed clearance of imported consignments.

While essential goods are being cleared and transported, non-essential items and commercial imports are piling up at country’s seaports.

An official at Port Qasim said the importers were not filing Goods Declaration (GD), a document that initiates the assessment and clearance process, as the cleared goods could not be transported to the destination. “A large number of imported consignments are meant for upcountry, which are now piling up at port terminals due to absence of transportation.”

The official said that traffic of vessels had slowed down, but still the cargo was coming. “There is no space at the terminal yards, and containers are now being dumped wherever the space is available. There is no marking or record keeping of these containers. After the lockdown is lifted, there would be a whole lot of mess in finding and assessing these containers.”

Normally around 10,000 containers land at country’s ports every day. This number has reduced by over 30 percent, but still more than 6,000 containers are landing each day, and not all are being cleared.

Government has not imposed a force majeure yet, and port operations are continuing. However, absence of transportation and non-filing of GDs by commercial importers have caused congestion at ports.

An official at Karachi Port Trust (KPT) said the port was operating efficiently. “The essential goods are being cleared and transported, while the non-essential goods are being stored separately to be cleared later.”

It may be mentioned here that government has extended the timeline for filing of GDs to 25 days, which earlier was 10 days from the date of arrival of cargo.

An official at DP World, the operator of Qasim International Container Terminal (QICT) confirmed that there was severe congestion at the port terminal due to slow deliveries. “At this point of time, Customs should facilitate all terminals to obtain more space from the port authorities to discharge the cargo.”

Syed Farhan, an importer, said a significant portion of country’s imports comprised of raw materials, which were not being cleared as the industrial units were closed. “As the timeline has been increased, importers would file GDs at least after 20 days”.

Arshad Jamal of Customs Agents Association said port terminals were overflowing and the imported consignments were being dumped at empty spaces. “Importers are not filing GDs due to non-recovery of funds from markets, shortened banking hours and unavailability of transport. Until the goods are cleared these are the responsibility of Customs and port authorities.”

It may be mentioned here that government has already banned import of crude oil and refined petroleum products, while there has been no spot buying of liquefied natural gas (LNG) in last three months.

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One Comment

  1. Importers still today 31-03-2020 paid fine, still PRAL didn’t update the system.

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