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Category: Ports and Shipping

  • Banks may accept container detention, demurrage charges

    Banks may accept container detention, demurrage charges

    KARACHI: The State Bank of Pakistan (SBP) has issued draft amendment to Foreign Exchange Manual under which banks may be allowed to accept container detention charges and demurrage charges in order to facilitate trade in payments.

    The SBP issued the draft amendments and invite stakeholders’ comments before finalizing the foreign exchange manual.

    According to the draft amendments made to 14 chapter:

    4A –Remittances of Container Detention Charges by Foreign Shipping Companies

    i. Authorized Dealers may accept container detention charges (CDC) directly from the customers of shipping companies/ agents (having valid shipping/agency license as stated under Para 1 (iv) ibid and valid agency agreement) in a separate PKR account opened for this purpose only. No other deposits whatsoever shall be made in such accounts by ADs.

    ii. Authorized Dealers may allow monthly remittance of CDC (net of disbursements, refunds, and income tax paid/payable) of up to USD 50,000/- on Form-M to foreign principals of those foreign shipping companies/agents which are collected in the above mentioned accounts on submission of application along with the following documents: –

    a. Applicable Tariff Rate Sheet;

    b. Summary of Detention Charges along with copy of invoices

    c. F.P Shipment & Breakdown of Disbursement

    d. Copiesy of Tax payment Rreceipt, agency agreement, valid customs shipping agent license.

    e. Auditors’ certificate from QCR rated audit firm confirming payment of income tax, genuineness of transactions and no duplication of payments (only for remittance beyond foreign exchange equivalent to PKR 1 Million or equivalent/-)

    f. Any CDC invoice involving detention charges above 100 days will require valid justification along with documentary evidence.

    g. An undertaking to repatriate back to Pakistan, the amount found by the State Bank, on post-facto checking, to have been remitted in excess of the entitlement.

    h. In case of Transit Trade, PRC evidencing receipt of equivalent PKR from the final destination country.

    Applications for monthly remittances beyond USD 50,000/- shall be forwarded to FEOD as per prescribed format along with relevant documents for approval.

    4B – Remittances of Demurrage Charges

    Authorized Dealers may allow monthly remittance of demurrage charges (net of allowed lay time and other deductions-if any, and income tax paid/payable) upto USD 50,0000 on Form-M to the Owner/Operator/Commercial Operator of vessels/ships/tankers on submission of application along with the following documents: –

    a. Valid charter party agreement (if applicable),

    b. Copy of the Invoice/ debit note

    c. Lay time calculation time sheet verified from third party

    d. Port statement of fact

    e. Copy of B/L, GD, Bill of Entry.

    f. Proceeds Realization Certificate (PRC) for port disbursement charges

    g. F.P Shipment & Breakdown of Disbursement

    h. An undertaking to repatriate back to Pakistan, the amount found by the State Bank, on post-facto checking, to have been remitted in excess of the entitlement.

    Applications for remittances beyond USD 50,000/- shall be forwarded to FEOD as per prescribed format along with relevant documents for approval.

    4C – Remittances of Surplus Port Disbursement Funds by Foreign Shipping Companies

    Authorized Dealer may allow remittance of surplus amount of port disbursement funds held by local offices of shipping companies/ agents back to their principals on Form-M, subject to valid Agency agreement/authorization letter and shipping license, after the payment of port dues/charges and duly reported on the F.P. Statement upon submission of application along with the following documents: –

    a. Customs & Port Charges Clearance with invoices

    b. Proceed Realization Certificate in Original

    c. Copy of Swift Message

    d. Copy of Schedule J/O-3

    e. F.P Shipment & Breakdown of Disbursement

    4D – Disbursement of Cash to Master of Ship arriving at Pakistani Ports

    Authorized Dealer may disburse cash to master of ship arriving in Pakistan out of remittance received by them from owner of the ship/ shipping lined abroad on submission of application along with the following documents: –

    a. Copy of Passport of the Master of the Vessel

    b. Copy of Crew List containing their names, passport numbers, country etc.

    c. Proceed Realization Certificate in Original

    d. Copy of Swift Message for amount realized

    Authorized Dealers will retain all the documents mentioned in Para 4 and its subparagraphs along with Form ‘M’ submitted by foreign shipping companies/ agents. The original Form ‘M’ shall be submitted as usual through schedule E-4 while reporting the transaction in the monthly Foreign Exchange Returns

    Any irregularity detected and advised by the State Bank shall be rectified by the concerned shipping company/agent within ninety days or the amount under objection will be repatriated or adjusted from subsequent remittance, as applicable.

    Authorized Dealers shall also ensure proper due diligence of the above mentioned remittances from AML/CFT and foreign exchange risk perspective through Compliance or Risk Management Department including but not limited to particulars of remitter/ beneficiary and shall determine the ultimate beneficial ownership/ relationship between entities.

  • Customs Rules tightened for International Transshipment

    Customs Rules tightened for International Transshipment

    ISLAMABAD: Federal Board of Revenue (FBR) has tightened the monitoring of international transshipment of imported cargo from gateway port to a foreign port.

    The FBR issued SRO 03(I)/2021 to amend Customs Rules, 2001.

    The FBR amend Rule 510A regarding transshipment of imported cargo from gateway port to a foreign port and made it mandatory the weight, seal number and container number for  international transshipment cargo.

    The following procedure has been prescribed for the movement of the International Transshipment cargo other than LCL cargo through any sea port in Pakistan, which shall be distinctly manifested as such in the IGM or carrier declaration uploaded electronically in the Customs Computerized System by the shipping line (VOCCs/NVOCCs) having valid shipping agent licenses. Such manifest shall necessarily include the following information, namely:

    (a) Port of loading;

    (b) Via port (name of the transshipment port of Pakistan);

    (c) Port of destination (final port of discharge at foreign destination);

    (d) Bill of lading (B/L) No.;

    (e) Name of foreign exporter;

    (f) Name of foreign importer;

    (g) Weight;

    (h) Seal No.; and

    (i) Container No.

    The FBR made amendment to rule 510B and stated that the Terminal Operator (TO) after unloading shall store International Transshipment containers at a place earmarked for them in the notified premises of a seaport. Further, a complete trail of IT containers including the time, location where they are placed and subsequent movements shall be electronically reported and updated in the Customs Computerized System by the Terminal Operator so that the location of the said containers is traceable at any given point in time.

    Further, the terminal operator shall deploy enough manpower to verify the shipper seals against the manifested seals and in case, a container is found without seal or with a different seal or any broken seal, such container shall be re-sealed and immediately released with the Customs seal in the presence of the custodian and same shall be recorded. The new seal number will be entered into the system before stacking of the container.

    Rule 510D regarding delay in clearance of transshipment goods has been substituted. Following is the text of the substituted rule:

    (1) The International Transshipment goods shall not be subject to payment of import or export duties and taxes provided the activities are in conformity with these rules.

    (2) If the goods stores for transshipment are not transshipment within thirty days of their arrival, a notice shall be sent to the shipping line or its agent on the address given in the shipping documents for transshipment of goods from the port. An extension of up to thirty days may be granted for the storage of such goods once a written request mentioning the reasons for delay in removal of goods in submitted to the concerned assistant collector of customs and such a request is approved by him.

    (3) If goods still remain on the port after sixty days of their arrival, the shipping line shall be responsible to remove them immediately unless the delay is attributed to the port authorities. The goods shall only be allowed for auction or destruction by approval of the concerned collector of customs who shall only allow in extraordinary conditions where the shipping line shows its complete inability to ship them out. The said reasons shall be recorded in writing.

    (4) In case of any hazardous material left at the port, the concerned shipping line shall have the responsibility to take the cargo back to the port of origin.

    The Rule 510E has also be amended and substituted the following text:

    “Execution of bond by shipping line: Shipping lines engaged in the business of international transshipment of containers and bulk cargo shall execute an indemnity bond for ensuring to follow customs rules and regulations.”

  • Transit trade activity starts at Gwadar Port

    Transit trade activity starts at Gwadar Port

    ISLAMABAD: A first carrier containing 200 tons of fish from international waters arrived at Gwadar. The fish will be shipped to China in reefer containers, said Federal Board of Revenue (FBR) on Monday.

    According to the FBR statement the arrival of the container at the Gwadar Port will open a new era of prosperity and growth for the people of Baluchistan and the economy of the country.

    This has been made possible under the directions of the Prime Minister of Pakistan to kick start operations at the Gwadar Port.

    Pakistan Customs is all geared up to realize the vision of the Prime Minister Imran Khan for transforming Gwadar into an International Transit trade Hub and facilitate trade through Gwadar Port.

    FBR has already notified International Transshipment Rules vide SRO 218(I)/2020 dated 10.03.2020. A dedicated Directorate of Transit Trade has also been established at Gwadar to work closely with the stakeholders and transform Gwadar into a Transit trade hub.

    As a result of this proactive approach and support of all stakeholders, in the coming days, more vessels containing international cargo including LPG, Steel Pipes, DAP fertilizer for transit to Afghanistan is scheduled to arrive at Gwadar Port.

    This reflects the confidence of the international business community and shipping lines in the economic potential of the Port and excellent trade facilitation measures put in place by Pakistan Customs.

    Gwadar is the future of Pakistan and will help the country in earning much needed foreign exchange in the future.

    During the recent visit of a high level Pakistani delegation to Afghanistan led by Advisor on Commerce, the Afghan businessmen have shown interest in making investment for trade through Gwadar Port.

  • Pak-Qater signs deal to provide online Takaful services to HashMove clients

    Pak-Qater signs deal to provide online Takaful services to HashMove clients

    KARACHI: Pak-Qatar General Takaful (PQGTL) has signed a MoU with HashMove (a global multi-modal logistics platform) to provide online Takaful coverage for cargo (Sea/Air/Warehousing & Land) for businesses in Pakistan.

    The purpose of this agreement is to enter into a strategic collaboration, enabling marine and fire Takaful service for sea/air and land cargo and commodities trading via digital mediums allowing corporates, businesses, customers of HashMove logistic platform such as importers, of freight forwarders, customers of ground transportation, customers of warehousing companies within Pakistan.

    This is the first time a Takaful Insurance company provides the digital coverage to the logistics businesses allowing them to conduct their export and import with full coverage. The companies aim to achieve at target of issuing at least 1000+ coverage / year to begin with.

    Talking at the occasion, CEO of Pak-Qatar General Takaful, Muhammad Nasir Ali Syed said: “The need of marine coverage by Takaful through digital channel will open a new door for the businesses to grow at a much faster rate with convenience at fingertips.

    “This is the need of the hour and my team is fully committed to extend cooperation and support where needed. Pak-Qatar Takaful has always maintained the position of a leader and firmly believes in offering innovative products through interesting projects and this time we are very excited to offer coverage through our business partner HashMove.”

    Sarfaraz Alam, CEO HashMove stated; “Pak-Qatar General Takaful is the leading Takaful coverage provider in Pakistan and a trustworthy name for settling claims against losses.

    “We are glad that our customers within Pakistan & South Asia will be able to avail Takaful coverage on real time basis. This is the one of the biggest milestones in the logistics industry in Pakistan and we have witnessed upward growth since last 2 years.”

  • List of companies for pre-shipment inspection under import policy

    List of companies for pre-shipment inspection under import policy

    ISLAMABAD: The ministry of commerce has issued list of companies for pre-shipment inspection as envisaged in different provisions of Import Policy Order, 2020 shall be done in the exporting country.

    The ministry issued SRO 902(I)/2020 dated September 25, 2020 to notify the Import Policy Order 2020.

    Following are the name of the companies under Appendix-H of the Import Policy Order 2020:

    a. Messrs Lloyds of London;

    b. Messrs Quality Tech, LLC;

    c. Messrs ABS;

    d. Bureau Veritas;

    e. Messrs SGS; and

    f. Messrs IMTECH

    The pre-shipment inspection companies as approved by Pakistan National Accreditation Council (PNAC) for the inspection of solar equipment (including but not limited to solar PV systems, off-grids /standalone solar PV systems, solar PV kits, solar PV panels, solar PV cells, inverters, charge controllers, balance of system components for PV systems, Low-voltage switchgear and control gear assemblies, power converters for use in PV power systems, insulated cables for use in PV systems, solar pumping systems for liquids, solar water heaters with accessories, solar stoves/cookers/ranges, etc. and parts thereof).

    Through Appendix-O the ministry also issued list of pre-shipment inspection following agencies:

    1. Baltic Control Pakistan, Suite No. 419, 4th Floor, The Cotton Exchange Building, II Chandigarh Road, Karachi on behalf of Baltic Control Ltd; Aarhus, Denmark.
    2. NMCI Pakistan (Pvt.) Ltd; Suite # 105, Khurshid Fancy, Jamaluddin Afghani Road, SharfabadChowk, Karachi on behalf of NMCI, USA.
    3. Inspectorates Corporation International (Pvt.) Ltd., A-53, Plot No. 26, St. 4, Nisar Road, Lahore Cantt, Lahore on behalf of Control Union, Germany.
    4. Inspectorates Pakistan (Pvt.) Ltd., 1st Floor, Lason Square Building No. 1, Sabir Beg Shaheed Road, Karachi on behalf of Coteena Group of Companies, Switzerland.
    5. M/s Control Union Pakistan (PVT) LTD, suit no 202.A, second floor, cotton exchange building, I.I Chundregarh Road, Karachi on behalf of Control Union Group of Companies, Netherland.
  • Resident shipping companies granted final tax regime

    Resident shipping companies granted final tax regime

    ISLAMABAD: The income tax law has allowed final tax regime for Pakistani resident shipping company, which is registered after November 15, 2019.

    According to explanation to changes made to Income Tax Ordinance, 2001 through Finance Act, 2020, the FBR said that clause (c) has been added to sub-section (1) of section 7A to provide for imposition of final tax of an amount equivalent to seventy-five US cents per ton of gross registered tonnage per annum for a Pakistani resident ship owning company registered with Securities and Exchange Commissioner of Pakistan (SECP) after November 15, 2019 and having its own sea worthy vessel registered under the Pakistan flag.

    The FBR said that final tax regime for taxing gross amount received or receivable by non-resident shipping companies at fixed tax rate under section 7 did not cover shipping income of a resident person.

    A new section 7A was, therefore, inserted through Finance Act, 2015, which provides for taxing shipping of residents under final tax regime.

    Further, dates of applicability of section 7 and clause (98) of Part-IV of Second Schedule which exempts import of ships and other floating crafts including tugs, survey vessels and other specialized crafts purchased or bare-boat chartered by a Pakistani entity and flying Pakistani flag from applicability of provision of section 148, have been extended to 30-06-2030.

  • Resident ship owners to pay tonnage tax at US 75 cents

    Resident ship owners to pay tonnage tax at US 75 cents

    ISLAMABAD: A Pakistan resident ship owning company shall pay tonnage tax of an amount equivalent to US 75 cents per ton, as proposed through Finance Bill, 2020.

    A new clause (c) has been inserted in Section 7A of Income Tax Ordinance, 2001 through Finance Bill, 2001 to levy the tax on resident ship owning company.

    “(c) A Pakistan resident ship owning company registered with the Securities and Exchange Commission of Pakistan after the 15th day of November, 2019 and having its own sea worthy vessel registered under Pakistan Flag shall pay tonnage tax of an amount equivalent to seventy five US Cents per ton of gross registered tonnage per annum.”

    The application of tax has been extended up to June 30, 2023 by amending sub-section 2.

    Before amendment the section is read as:

    7A. Tax on shipping of a resident person.—(1) In the case of any resident person engaged in the business of shipping, a presumptive income tax shall be charged in the following manner, namely:—

    (a) ships and all floating crafts including tugs, dredgers, survey vessels and other specialized craft purchased or bare-boat chartered and flying Pakistan flag shall pay tonnage tax of an amount equivalent to one US $ per gross registered tonnage per annum; and

    (b) ships, vessels and all floating crafts including tugs, dredgers, survey vessels and other specialized craft not registered in Pakistan and hired under any charter other than bare-boat charter shall pay tonnage tax of an amount equivalent to fifteen US cents per ton of gross registered tonnage per chartered voyage provided that such tax shall not exceed one US $ per ton of gross registered tonnage per annum:

    Explanation.—For the purpose of this section, the expression “equivalent amount” means the rupee equivalent of a US dollar according to the exchange rate prevalent on the first day of December in the case of a company and the first day of September in other cases in the relevant assessment year.

    (2) The provisions of this section shall not be applicable after the 30th June, 2020.

  • ECC approves free period for cargo, containers landing up to May 31

    ECC approves free period for cargo, containers landing up to May 31

    ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet non Wednesday approved free period from five working days to 15 working days for cargo and containers landing up to May 31, 2020.

    The ECC considered and approved a proposal by the Ministry of Maritime Affairs for extension due to corona pandemic of free period from five working days to 15 working days for cargo and containers landing for period up to May 31, 2020.

    The ECC of the Cabinet has asked the Ministry of National Food Security and Research to closely monitor the wheat procurement process and actively engage with the food departments and PASSCO to ensure procurement of wheat as per 8.25 million tones target set for procurement by the public sector this year.

    The ECC meeting chaired by Adviser to the Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh asked the Ministry of National Food Security and Research to submit to ECC a detailed report in the next two to three weeks on the progress of wheat procurement by PASSCO and provincial food departments and overall wheat production in the country with the help of reliable data and figures to have a clearer picture for better planning in future.

    The ECC also called for exploring possibilities for extending more time to flour mills to procure wheat from the market, allowing inter-provincial movement and preventing smuggling of wheat outside Pakistan.

    The ECC gave the instruction after a report was presented to it by the Ministry of National Food Security and Research on wheat procurement by the public sector in the current season.

    The Ministry, in its report, told the ECC that the wheat procurement target for the wheat crop 2019-20 was set to 8.25 million tones with 4.5 million tones to be procured by Punjab, 1.4 million tones by Sindh, 0.4 million tones by Khyber Pakhtunkhwa, 0.1 million tones by Balochistan and 1.8 million tones by PASSCO.

    So far PASSCO and the provincial food departments had procured 3.96 million tones of wheat, approximately 48 percent of the target while the procurement pace was slow in KP and Balochistan and both the provinces had been requested to speed up the procurement process.

    The ECC also took up another proposal by the Ministry of National Food Security and Research for fixing an intervention price for cotton and after a detailed discussion asked the Ministry to come up with a comprehensive package focusing on cotton seed research, overall research and development, better water management, deregulation of the sector and zoning of crop growing areas to enhance productivity and competitiveness of the local crop.

    The ECC also discussed and approved five separate supplementary grants on different proposals submitted by various divisions.

    On two separate proposals for technical supplementary grants by the Defence Division, Rs 1.665 billion grant was approved for upgradation of Special Telecom Monitoring Project at Directorate ISI and a Rs 500 million for construction of Special Education School at the Defence Complex Islamabad.

    On a proposal by the Prime Minister’s Inspection Commission, a technical supplementary grant of 10.476 million was approved for assistance package for the family of Raees Anwar Abbasi, Senior Private Secretary (BS-19), Prime Minister’s Inspection Commission following his death on 12th August 2019.

    On a proposal for technical supplementary grant by the Poverty Alleviation & Social Safety Division, an amount of Rs12.143 million was approved following transfer of the subject of “Collection of Zakat and Ushr, disbursement of Zakat and Ushr to the Provinces and other areas as per formula approved by the Council of Common Interest” from Religious Affairs & Interfaith Harmony to the PA&SS Division and subsequent transfer of officers along with their posts and budgets by the Ministry of Religious Affairs & Interfaith Harmony to the PA&SS Division.

    On another proposal for technical supplementary grant by the Finance Division, the ECC approved Rs 306.615 million for the Office of Controller General of Accounts during FY 2019-20 for payment of dues on account of Prime Minister’s Assistance Package. On a proposal by the Ministry of Interior, the ECC allowed Capital Development Authority (CDA) Islamabad to allocate Rs 3.05 billion to the Metropolitan Corporation Islamabad (MCI) on loan basis for payment of obligatory expenses for the second half of the FY 2019-20.

    The ECC also considered and approved a proposal for reconstitution of a Committee formed by the ECC in its meeting on 26th March 2020 for examination of incentive package for the National Electronic Vehicle Policy by nominating the Minister for Industries and Production Hammad Azhar in place of Abdul Razak Dawood as Chairman and member of the committee following the cabinet reshuffle and including Secretary Commerce as member of the Committee in place of Adviser to the Prime Minister on Commerce and Investment  Abdul Razak Dawood.

    The ECC also approved another proposal by the Ministry of Maritime Affairs for technical supplementary grant of Rs 58 million as compensation of the demolished structures of Pakistan Coast Guards in order to provide 19 acres land previously in possession of Pakistan Coast Guards and vacated for Gwadar Free Zone and Right of Way of the Eastbay Expressway. On a proposal by the Ministry of Energy for development of a new mechanism/criterion for disbursement of payments to the tune of Rs 300 billion through CPPA-G to the power generators, the ECC asked the Power Division to devise the requisite criterion for fair and equitable disbursement of payments to the power generators and come back to ECC for its approval.

    On another proposal by the Power Division, the ECC approved shifting of most expensive loan from the books of PHL to Government of Pakistan and taking up of Rs 136.454 billion loan in the FY 2019-20 while other loans to be considered in the following financial years accordingly.

    On another proposal by the Power Division, the ECC gave go-ahead to issuance of new sovereign guarantee by the Ministry of Finance in respect of fresh syndicated term finance facility for Rs 41 billion through Power holding Limited (PHL) for the purpose of set off/adjustment of existing PHL finance facility of Rs 41 billion executed in pursuance of ECC decision made on 7th June 2017. The ECC, on a proposal by the Petroleum Division, asked the Finance Division to transfer Rs 11.7 billion in the NBP account for ensuring remittances to Kuwait as per schedule.

  • Terminal operators refuse to extend waiver from detention, demurrage charges: KCCI

    Terminal operators refuse to extend waiver from detention, demurrage charges: KCCI

    KARACHI: Karachi Chamber of Commerce and Industry (KCCI) has said terminal operators have refuse to extend waiver from demurrage and detention charges despite clear instruction of the government to facilitate the trade in the wake of COVID-19.

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  • DP World takes precautions for consignment clearance at QICT to prevent COVID-19 spread

    DP World takes precautions for consignment clearance at QICT to prevent COVID-19 spread

    KARACHI: DP World has issued advisory regarding precautionary measures against coronavirus (COVID-19) for clearance of consignments at Qasim Qasim International Container Terminal (QICT).

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