Showing posts with label business. Show all posts
Showing posts with label business. Show all posts

Tuesday, 4 March 2014

Customs Convention on Container

This Convention is administered by the Customs Co-operation Councils .

Its purpose is to facilitate the use of containers in international traffic . The contracting parties grant free temporary admission to containers subjected to re-exportation when they are ;

-----   Imported loaded to be re-exported empty or loaded .

-----   Imported empty to be re-exported loaded .

Containers have to be approved in compliance with technical conditions concerning construction and closing systems, including ;

-----   External marking with owner's name and address , tare and identification;

-----   They have to be capable to simple the effective sealing;

-----   It must not be possible to introduce or remove any goods without breaking the seal or leaving trace of tampering .

-----   There must be no space in which goods might be hidden;

-----   They must be readily accessible for Customs inspection; a certificate of approval must be displayed on the outside .

-----   Prescribed structural requirements;

-----   Requirements relating to the closing system .

These are the main points regarding this .

Advantages of TIR to Customs

The advantages for customs authorities of States Contracting Parties to the TIR Convention are considerable.

In particular the following may be mentioned .

-----   The physical inspection of the load and transit country frontiers , expensive in terms of labor and facilities , can be replaced by inspection confined merely to the external condition of the container or the means of transport and the sales  affixed by competent authorities in the country of departure ;

-----   It is no longer necessary to organize a national guaranteeing system since an International guaranteeing system of lawful amount per TIR carnet and per country is provided by the TIR system .

-----   It eliminates the need for an expensive national system of documentary control .

Commercial Advantages :-

The advantages to commerce and to transport interests are equally clear . Goods may travel across national frontiers with a minimum of interference by Customs . By reducing delay in transit , it enables significant economics to be made in transport costs. Moreover the revised provision of the TIR convention enable this advantages to be widely applied to the transport of goods in containers . Finally in reducing the impediments to international traffic by Road Customs Control , it enables exporters to select more easily the form of transport most suitable to their needs .

Wednesday, 26 February 2014

Partial Shipments and Drawings


-----   Partial drawings and/o shipments are allowed , unless the credit stipulated otherwise .

-----  Shipments by sea , or by more then one mode of transport but including carriage by sea , made on the same vessel and for the same voyage , will not be regarded as partial shipments , even if the transport documents indicating loading on board bear different dates of issuance and/or  indicate different ports of loading on board .

-----   Shipment made by post will not be regarded as partial shipment if the post receipts or certificates of posting appear to have been stamped or otherwise authenticated in the place from which the credit stipulates the goods are to be dispatched , and on the same date .

-----   Shipments made by modes of transport other than those referred to in the above paragraph of this article will not be regarded as partial shipments , provided the transport documents are issued by one and the same carrier or his agent and indicate the same date of issuance , the same place of dispatch or taking in charge of the goods , and the same destination .

-----   If drawings and/or shipment by installments within given periods are stipulated in the credit and any installment  is not drawn and/or shipped with in the period allowed for that installment , credit ceases to be available for that and any subsequent installments , unless otherwise stipulated in the credit .

Monday, 24 February 2014

Contractual Stipulation

 Two container ships pass in San Francisco Bay

-----  Any stipulation in a contract of carriage by sea , in a bill or lading , or in any other document evidencing the contract of carriage by sea is null and void to the extent that it derogates , directly or indirectly , from the provisions of this convention . The nullity of such a stipulation does not affect the  validity of other provisions of the contract of document of which it forms a part . A clause assigning benefit of insurance of goods in favor of the carrier , or any similar clause , is null and void .

-----  Notwithstanding the provisions of  this , a carrier may increase his responsibilities and obligations under this Law .

-----  Where a bill of lading or any other documents evidencing the contract of carriage by sea is issued , it must contain a statement that the carriage is subject to the provisions of this .which nullify any stipulation derogating therefrom the detriment of the shipper of the consignee .

-----  Where the claimant in respect of the goods has incurred loss as a result of stipulation which is null and void by virtue of above , the carrier must pay compensation to the extent required in order to give the claimant compensation in accordance with the provisions of this rule for any loss of or damage to the goods  as well as for delay in delivery . The carrier must , in addition , pay compensation for  cost incurred by the purpose of exercising this right , provided that costs incurred in the action where the foregoing provisions i invoked are to determined in accordance with the law of the state where proceedings are instituted .

Saturday, 22 February 2014

Document of Title

Multimodal Transport Document to be regarded as Document of Title 

1)  ---  Every consignee named in negotiable or non negotiable multimodal transport document and every endorsee of such document , as the case may be to whom the property in the goods mentioned therein shall pass up or by reason of such consignment or endorsement , shall have all the rights and liabilities of the consignor .

2)  ---  Nothing contained in (1) shall prejudice or affect the right of the multimodal transport operator to claim freight from the consignor or enforce any liability of the consignee or endorsee by reason of his being such consignee or endorsee .

But before to understand this we have to know clearly ;

Issue of Multimodal Transport Document 

-----   Where the consignor and multimodal transport operator have entered into a contract of the multimodal transportation and the multimoddal transport operator has taken charge of goods , he/she shall at the option of the consignor issue a negotiable or non-negotiable multimodal transport document .

-----   The multimodal transport document shall be signed by multimodal transport operator or by a person duly authorized by him .

Friday, 21 February 2014

Applicability of the Rules to action in tort


The MTO would also need to be protected from claims when they relate to the performance of the contract but nevertheless the claimant seeks to avoid Rules by founding his claim in tort . The rule will not work when there is no contractual relationship between the MTO and the claimant . However , it contains an important protection of the MTO against a possible circumvention of the Rules by the person who has agreed to bound by the Rules .

These Rules apply to all claims against the MTO relating to the performance of the Multimodal Transport Contract , whether the claim be founded in contract or in tort .

There is also a Rule purports to protect the servants and agents and other person employed by the MTO , and thereby indirectly the MTO himself , by stipulating that the same protection which applies to the MTO would also apply to the benefits of any servant , agent or other person whose services the Multomodal Transport Operator has used in the order to perform the MT contract . 

Also in these cases it does not matter whether such claims are founded in contract or in tort .

This Rule is of the same essence as the so called Himalaya - Clauses , which are usually be found in the bills of lading and other transport documents .

It should be noted that the carrier is given the same protection under the Hague - Visby Rules even in the absence of the clause .

Monday, 17 February 2014

Reservation having a bearing on MT


Followings are Reservation having a bearing on MT :- 

a)   -----  Imports not to be discriminated on the basis of the origin .

b)   -----  Unloading of goods at a place other then the one approved .

c)   -----  Allowing of outright exportation from the premises of commercial undertakings .

d)   -----  Single goods deceleration to cover exports over a period of time .

e)   -----  Evidence of country of origin to be required only in case of fraud  - Declaration instead of certificate .

f)   -----  Transhipment not to be refused on the basis of origin .

g)   -----  Any person having the right to dispose of the goods to be permitted to declare for transhipment (as against carriers at present) .

h)   -----  Transhipment to be allowed on the basis of  commercial/transport document (now : Bill of Transhipment) .

Thursday, 13 February 2014

ICC and Documentary Credits


-----   The International Chamber of Commerce (ICC) is the World Business Organization  of non - governmental nature . It was established in the year 1919 and has its international secretariat in Paris .

-----   ICC acts to promote the greater freedom of  of world trade , to harmonize and facilitate business and trade practices and to represent the business community at international level . The ICC works towards trade liberalism bases on free and fair competition and to promote the ideals of a free enterprise . It believes in self regulation by business .

-----   The ICC being a non - governmental and independent world organization , enjoys a status of first category consultant with UN organization including its specialized agencies . In order to maintain close liaison with UN activities that directly concerns business and to ensure receipt of consideration of business view point   in UN policy formulation , ICC maintain liaison with officers in New York and Geneva also .

-----   ICC formulates business policies , mechanics of trade and various other subjects relevant to international trade and business management . For this purpose it has special commission like ICC commission on Banking Technique and Practices .

-----   In its efforts to standardize the rules governing operation of documentary credits, ICC has codified a standared  set of rules for operation of credits . These rules are known as  "Uniform Customs and Practices for Documentary Credits"  (UCPDC)  . These rules where fist codified in the year 1933 and were adopted in the same year at the Seventh Congress of ICC in Vienna . They were subsequently revised in the year by year as per need till present days .

-----   ICC as author of  UCPDC  gives its views , opinions and clarification on various quarries relating  to UCPDC  . Such opinion given by ICC Banking Commission as published in numbered brochures of ICC . The latest brochures containing ; Bankers who are associated with International Trade , particularly Documentary Credits , must keep themselves abreast of these publications . It must also be appreciated that while ICC is an author and guardian of UCPDC , its article do not intend to define the legal structure of Documentary Credits . 

Tuesday, 4 February 2014

Classification of Logistics Applications


While examining and evaluating alternatives in Logistics Management , classifying the application on various dimensions would help clarity the issue and focus attention . As indicated earlier , logistics application can be classified in terms of issues and actors . Other imported classifications based on various dimensions are :- 

a)  ---  Inbound Logistics and Outbound Logistics :  Most organization have to manage their outbound logistics  (i.e. physical distribution of their products to the customers from the factory) where as inbound logistics concerns itself with the purchasing function . The logistics of purchased product is generally managed by suppliers .  An obvious advantage of managing both inbound and outbound logistics is the possible cost saving when the two movements are coordinated  .

b)  ---  Private vs Public Sector :  The nature of ownership of the organization influences the objectives of organization and hence management of logistics . The choice of modes , transport contracting , response to socially oriented regulations , location choices , etc . would be on different conditions .

c)  ---   Single vs Multiple Plans :  Certain decisions like allocation decisions , coordination in production planning across plants , product wise specialization of plants etc . would be issues of significance in the multi - plant  situation .

d)  ---   Nature of the Product :  There could be various sub - dimensions here like bulk vs packaged products , perishable vs non - perishable products , durable vs non durable products , single vs multiple products and industrial vs consumer products .  handling of bulk products is quite different from handling packaged products . An organization making multiple products has more problems in coordinating its production planning , inventories and transportation then an organization making a single product .

e)  ---   Mode to Stoke vs Mode to Order :  The inventory , transportation and distribution network related decisions are more significant for an organization in which the products are made to stoke rather then made to order .

Tuesday, 21 January 2014

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 the goods under this clause and the right exercised by forwarder under this clause shall not be deemed to have been  waiver of his right to take further legal steps to recover the dues .

Time Limit :-

Claims against the forwarder shall be timed barred within a period of one year commencing from the day of delivery of the goods to the consignee named in the contract or , if no delivery has taken place , from the data of the conclusion of the forwarding contract .

Jurisdiction :- 

Unless expressly agree to the contrary , claims against the forwarder shall be decided at the principal place of his business . 

Monday, 20 January 2014

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 Internationale or  National rule .

e)   The forwarder may arrange / provide transport for customer and in such event the forwarder shall not be held responsible as a carrier or assume the liability of a carrier .

f)   In the event of the liability of the forwarder being sought to be varied , the variation shall only be effected by a written document signed by the forwarder .

Friday, 17 January 2014

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 between the face of the cargo and container doors . It is important that the cargo does not collapse into th space . It can be prevented in a variety of ways , such as :

1)  Using suitable positioned lashing points with wire , rope , strapping , etc. woven across .

2)  Inserting a simple wooden gate for the wider gaps and heaver cargo .

3) Providing filler peaces for narrower gaps and lighter cargoes like cartoons of biscuits . 

Tuesday, 14 January 2014

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 .

Locking  :-    Cargo built up to give a three dimensional brick well effect  .

Monday, 13 January 2014



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 by bottom layer bags/packages , the commodities are staked on appropriate dunnage ,

Following dunnage materials are commonly used at the warehouse :-

a)   Wooden crates or HDPE crates of size   5'*2'  or other appropriate size .

b)   Bamboo mats prepared out of closely woven bamboo strips

c)   Polythene films of atleast   100 micron  thickness .

While wooden crate is the most ideal dunnage . However , in the view of scarcity of good quality wood due to restriction in deforestation and consequent high cost , stocks at the warehouse are also stacked by providing two layers of bamboo mats with sandwiched layer of polythene film .

Saturday, 11 January 2014

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 :-

-----   The multimodal transport operator who has not been paid the amount of consideration stipulated in the multimodal transport contract shall have a lien on the consignment and the documents in his possession .

-----   Notwithstanding anything contained the period during which the goods are in possession of the multimodal transport operator in exercise of his right of lien and shall not be included for the purpose of calculating the time of delay under any rule or law .

Notwithstanding anything contained in any other provision of any Act , it shall be lawful for the parties to the multimodal transport contract to include in the multimodal transport document any provision relating to General Average .

Explanation :- For the purpose of section  "general average" means loss , damage or expanse reasonably incurred in order to avert danger to property in common peril and in the common interest involved in the multimodal transportation .

Thursday, 9 January 2014

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 

Monday, 6 January 2014

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 mode which has the required capacity available or which can be easily adopted to meet the requirements .

-----   regulatory system ;  regulation which is particularly important for container traffic with regard to traffic restrictions and weight limitations .

-----   Institutional frame ;  work which is necessary for a coherent well co-ordinated  transport policy , the implementation of which could be entrusted to the national co-ordination authority proposed earlier .


Sunday, 5 January 2014

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 communications required with customers and receivers to ensure smooth operations .

--  Since several administrative agencies and commercial interests are involved in the new procedures and practices connected with Multimodal Transport .

--  It would be advisable to create one agency which will be primarily responsible for  co-ordinating the work of the various sectors and interests .

Friday, 3 January 2014

International Co-ordination

 Tilted aerial view of modern airport. Aircraft are parked next to "arms" that extend from the central building

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 , etc.

There is growing awareness that multimodalism and EDI require a co-ordinates approach involving all sector concerned like trade, transport , finance etc . and regional co-ordination on standard documentation and procedures is desirable .

Thursday, 2 January 2014

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 Natural Rubber Clauses

6)     Institute Container Clauses

7)     Institute Commodity Trade Clauses .

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