Showing posts from January, 2014

Defenses For Carriage By Sea Or Inland Waterways

Defenses For Carriage By Sea Or Inland Waterways 

Notwithstanding the provisions of Basis of Liabilities of the MTO , The Multimodal Transport Operator shall not be  responsible for loss or delay in delivery with respect to goods carried by Sea or Inland Waterways , when such loss , damage or delay during such carriage has been caused by :

-----     Act , neglect or default of the master , mariner , pilot or the servants of the carrier in the navigation or  in the management of the Ship .

-----     Fire , unless caused by actual fault or privity of the carrier .

However , always provided that whenever loss or damage has resulted from unseaworthiness of the ship , the MTO can prove that due diligence has been exercised to make the ship seaworthy at the commencement of the voyage .

Conversion of delay into final loss   :-

If the goods have not been delivered within 90 consecutive days following the date of delivery determined according to Rule as Delay in Delivery , the claimant may in …

Inventory and Warehouse


Inventory plays a key role in Logistics Management . The inventories that are directly affected due to outbound logistics are ;_

-----     Finished goods inventory

-----     Pipeline inventory (Primary Transaction)

-----     Warehousing inventory

-----     Pipeline inventory (Secondary Transaction)

-----     Retail inventory

The typical cost trade - offs between inventory an others decisions in Logistics would be :-

-----     Inventory vs Transportation costs

-----     Inventory vs Stock out costs

-----     Inventory vs spoilage and material handling cost .


The purpose of warehousing is to arrange placement of products , provide storage facility , consolidate them with other and similar products , divide them into smaller quantities and to build up a required assortment of products . The necessities of providing warehousing are ;

-----     To get continuous and uninterrupted supply in the market area .

-----     To achieve full benefit of the economies in scale…

Problems in Developing Countries

There are however several problems which developing countries may face in promoting indigenous multimodal transport organizations .

1)   Multimodal transport operations are linked , in the majority of cases with the use of modern transport technologies like containerization ,These technologies are on the whole capital intensive and would require large investment in ship , vehicles , transport equipments , container depots , ports and other inland  transport infrastructure like roads and railways .

2)   At the same time these technologies are labour saving and would give rise to undesirable redundancy of port labour in developing countries where the cargo handling operations are labour intensive .

3)   Indigenous MTOs may face competition from foreign and develop MTOs already operating inb the same routes .

4)   Apart from large investment , international multimodal transport operations will call  for organizing ability as well as marketing and planning expertise of a high order .

5) …

Lien and Detention

Right to lien and detention :-

a)   Constituent shall pay the bills presented by the Forwarder within  15 days of their presentation , failing which penal interest at the provided rate of interest ( may be 3% or near by ) above Bank's lending rate of interest shall become due to payable .

b)    The forwarder has a right to lean and a right to detention over the goods or other securities and effects lying within his power of disposal in respect of any amount whether already due for payment or not which  the forwarder is entitle to receive in respect of service to the customer . In exercise of the lien under the clause , the forwarder shall be entitled to dispose of the goods , either by public or private sales upon which lien is exercised , to recover this dues , provided that he gives a written notice of at least 7 days to the customer of his intention to do so . The forwarder is entitled to recover all the balance amount from the customer after recovery of the dues by the sale of…

Liability of Freight Forwarder

It is very important to know about the liabilities of the freight forwarder . It is necessary for Logistics Professionals and also for the Trades .

Followings are the important liabilities of freight forwarder :-

a)   The forwarder is liable only for his own faults attributable to himself or his employees .

b)   Th forwarder shall not b liable for act or omissions of third party such as re-forwarder , carrier  etc. provided that he has shown due diligence in the choice of such third parties . It can be proved that he has not done so , his liabilities shall not exceed that of any third party held liable , whom he has contracted with .

c)   The forwarder shall not be liable to the customer for consequential loss or loss of market howsover caused .

d)   The liability of the forwarder for loss of or damage will be fixed , as per the contract with consignor or consignee . Actually this part is an understanding between the parties and the freight forwarder and also covering the Internationa…

Stowage and Restrain

 How to Restrain certain types of Cargo :-

Top heavy articles should be wedged , shored and lashed to prevent topping .

Heavy weight should be secured to stout ring - bolts (sited in the container floor and side walls ) and be shored with timber . They should be chained or wired with bottle screws .

Resilient loads can caused lashings to slacken  - this may sometimes be overcome by introducing elasticity may be rubber rope into lashing pattern .

No securing of pallets is necessary  if the distance between pallets and container wall is 4'' (100mm) or less . Pallets must not be allowed any longitudinal movement . If it is necessary to secure them , stow the pallets against the container walls and wadge wood block between the pallets . It may be necessary to insert sheets of board between the pallet loads to protect them against chafing and prevent bags , cartons  , etc . interweaving and jamming the stowage .

Stowage Precautions :- 

In the majority of cases , there is space left…

Restrain the Cargo

It is always necessary to restrain the cargo for one or more of the following reasons :-

-----  To prevent collapse the stow while packing , unpacking or during transit

-----  To stop any movement during transit of pat loads or of single heavy items  , the heavier the item the more damage it will do if allowed to move .

-----  To prevent the face of the stow collapsing and learning against the container doors to fall out when the doors are opened at the final destination or for customs inspection .

Methods of Securing Cargo :-

The more common methods of securing cargo are ;

Shoring  :-     bars , struts and spars located in the cargo  voids to keep the cargo press against the walls or other cargo .

Lashing  :-     ropes , wires , chains , strapping or netting secure to proper anchoring points and tensioned against the cargo .

Wedging :-    Wooden distance pieces , pads of synthetic materials , inflatable dunnage to fill voids in the cargo and keep in immobile against the container walls .


Moisture in the stored commodities is one of the important factors causing qualitative and quantitative deterioration during storage . Food grains which are dried plants material tend to absorb moisture from all sources including atmospheric air , godown floor , godown walls etc . other stored commodities such as jute , cotton etc. also absorb moisture from the floor . Higher the moisture content in the stored commodities , faster is the deterioration due to insect and microbial activities and , therefore lesser is the storability .

 The stored commodities also loose weight due to driage resulting in quantity loss . Permissible limits of such driage loss in different commodities depending upon the period of storage are provided in the respective Local Warehouse Rules . Moisture content of the stocks at the time of receipt and delivery is , therefore recorded using appropriate type of moisture meter and duly authenticated by depositor .

In order to prevent absorption of floor moisture…

Special Provisions For Dangerous Goods

-----  Where the consignor hands over the prescribed dangerous goods to a multimodal transport operator or any person acting on behalf of such operator , the consignor shall inform him to the nature of dangerous goods and if necessary , the precautions to be taken while transporting such goods .

-----  Where the consignor fails to inform the multimodal transport operator or the other person acting on behalf of such operator of the nature of the dangerous goods and such operator or person does not otherwise have knowledge of the dangerous goods .

     a)  The consignor shall be liable to the multimodal transport operator or the other person acting on behalf of such operator for all loss resulting from the multimodal transportation of such goods ; and

     b)  The goods may at any time be unloaded , destroyed or rendered innocuous , as the circumstances may require , without payment of compensation .

Right to multimodal transport operator to have lien on goods and documents :-

-----   T…

Logistics Decisions

An understanding of the logistics chain is useful to appreciate the decision areas in logistics

Value Added Chain :-

Vendor --> Raw material movement --> Production point --> Finished --> Products --> Warehouses --> Wholesaler --> Retailer --> Customer .

We know that the management of logistics is a complex process which involves a whole range of physical , managerial and informational issues related to the following decision areas .

----- Product Design

----- Plant Location

----- Production Structure

----- Distribution / Dealer Network Design

----- Location of Warehouses

----- Allocation Decisions

----- Production Planning

----- Inventory Management - Stocking Level

----- Transportation - Mode  Choice , Shipment Size , Routing Decisions and Transport Contracting

----- Packaging

----- Materials Handling

----- Oder Processing

----- Warehouse Operations 

Infrastructure for MTOs

The need for upgrading transport infrastructure and adapting it to meet the requirements of multimodal transport is governed by National Transport Policies which should ensure optimum use of existing infrastructure and optimum investment in new infrastructure .It would be advisable fo policy makers to examine every thing ;

-----   rationality of investment decisions ;  investment decision should be based on cost benefits analysis not only in respect of new investments but also in respect of investments for upgrading existing infrastructure .

-----   relationship of costs to the charges payable by users ;  To the extent possible , the charge payable by users should reflect the actual cost of infrastructure including interest on capital invested and cost of maintenance and repairs .

-----   level and structure of tariffs ;  This should take into account the peculiarities of the transport mode concerned and should be so designed as to direct traffic  ( primarily container traffic ) to a…

Institutional Changes

Since , Multimodal Transport is not very old concept different from the traditional concept o Segment Transport . It involves various institutional changes which are intended to smoothen through transport operations with the minimum of delay .

--  For example when cargo moves multimodally through a port , the port's functions become  limited mainly to transit operations and consequently , the port operation will require re-organizations to some extent to meet the requirements of expeditious delivery to inland transport , such as Road , Rail or Inland waterways and Airways .

--  The Customs procedure will need to be modified so that customs examination of goods is carried out not at the port but at the inland centers like ICD or CFS etc .  Where goods are taken in charge by the MTO from  the consignor or delevered by the MTO to the consignee .

--  Documentation and information system will need be improved to cope with the large number of unit passing through and the increased comm…

International Co-ordination

The very nature of multimodal transport required International Co-ordination at three levels .

-- With neighboring countries on cross border procedures and in infrastructure developments .

-- With trading partners on trade  , banking and insurance procedures .

-- With the International community on the development of worldwide standards in  such areas as :-

----------- documentation

----------- UN/EDIFACT rules

----------- Inco Terms

----------- Harmonize system for commodity classification .

Therefore there is room to compliment the activities of  the National Multimodal Transport Committee with regional initiatives . In particular there is a need ;

----- To monitor international efforts to standardize procedures , documentation , definitions , classifications etc . pertaining to international trade and transport to formulate a regional position and or represent member countries' interests at such fora .

----- To insure region wide standards for documentation , tariff structures…

Marine Insurance

We already know that the marine insurance is cover both for hull(ship) as well as for cargo .For "hull" the institute has standardize Institute Time Clause ,  Institute Voyage Clauses and for combined voyage and time policies . For fulfilling the requirements of cargo of general nature the Institute has standardize the given Clauses .

1)     Institute Cargo Clauses ( Free from particular Average )

2)     Institute Cargo Clauses ( Warehouse to Warehouse )

3)     Institute Cargo Clause ( All risks )

Beside this there may be a number of commodities and food stuffs which require special clauses to provide for the particular risks of the subject matter insured depending upon the nature of cargo . In consultation with the trade associations the Institute of London Underwriters has standardize these clauses too .  These are :-

1)     Institute Coal Clauses

2)     Institute Bulk  Oil Clauses

3)     Institute Jute Clauses

4)     Institute Frozen Food Clauses

5)     Institute Natura…

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