As the ‘Carriage of Goods by Sea’ bill was approved by the National Assembly’s standing committee on ports and shipping last month, this bill is all set to become an act once it is introduced in the assembly. Thus, traders and maritime experts demand that since the bill is in complete favour of shipping agents and freight forwarders and no protection is given to trade, there should be a regulatory authority for making sure that there will be no fraud in Bill of Lading and no changes are made in the titles of goods by the shipping agents. The authority should also monitor the freight, they demanded.
‘Carriage of Goods by Sea’ was drafted in 2005 by the then director general ministry of ports and shipping captain Anwar Shah, and that draft was prepared with the consent of all stakeholders. But this revised draft (that was made bill by the standing committee) was much tempered and does not protect rights of many stakeholders. It is to be noted that two documents ‘bill to enact Carriage of Goods by Sea Act, 2011’ and ‘bill to enact Sea Carriage Shipping Documents Act, 2011’ were last considered by the National Assembly standing committee on ports and shipping in the meeting held on 26th September 2011, in which Pakistan apparel forum had proposed certain amendments to the bills. Standing committee had decided that comments on the same may be obtained from ministry of commerce, State Bank of Pakistan, and Federal Board of Revenue (FBR) for reconsideration of the matter by the committee.
committee’s stance
‘Carriage of Goods by Sea’ bill, 2010 attempts to modernise the old law, that is, the ‘Carriage of Goods by Sea’ act, 1925 by incorporating provisions of the international convention relating to the bills of lading subject to necessary amendments and further provides for a list of legal documents concerning the carriage of goods by sea. While the Sea Carriage Shipping Documents Bill, 2010 largely aims at recognising different legal documents for purposes of carriage of goods by sea and determining their rights and obligations, and stipulating evidentiary status of such documents. It is not clear why these matters could not be covered into one consolidated law on carriage of goods by sea.
Comments of MoC
Amendments proposed in the Sea Carriage Shipping Documents Bill, 2011 by the internationally recognised legal nomenclature is ‘bill of lading’ and not the ‘carrier bill of lading’. Similarly, ‘Seaway bill’ and ‘delivery order’ are internationally recognised documents relating to carriage of goods by sea. Their definitions and related sub-sections cannot be changed or deleted. Moreover, ‘consignee’ is the legal term and cannot be replaced as proposed. Definitions are exactly the same as in British ‘Carriage of Goods by Sea’ act, 1992 and cannot be changed.
Regarding Section 3 that deals with shipping documents to which this act applies, as already explained under Section 2 that documents have been listed in accordance with international shipping practice and British Carriage of Goods by Sea Act, 1992. Carrier bill of lading is just one document in use, and international shipping cannot be restricted to use of only one document. In addition, Section 4 about rights under shipping documents clearly defines the rights under various documents and how these are transferred. This is in keeping with the British act, and the amendments proposed are not workable.
SBP’s response
A summary for approval in principle for the Logistics Service Providers Regulatory Authority Bill, 2011 has already been submitted by the Ministry of Commerce to the Cabinet. After vetting by law division and final approval of the cabinet, the bill will be submitted to the National Assembly for its consideration. Main concern of the traders’ bodies has been that freight forwarders issuing house bill of lading do not carry any liability in case of loss or damage to cargo.
This ‘Logistics Service Providers Regulatory Authority’ bill, 2011 provides that all logistic services providers take suitable liability insurance cover of Rs1 million and those issuing their own transport document i.e house bill of lading or house airway bill, etc of Rs10million, for loss or damage to the cargo handled and transported for which they are liable as per terms of their contract.
It may be added that in case of imports through freight forwarders, importers in Pakistan normally take delivery of goods on the basis of forwarder’s house bill of lading without any MBL of shipping line but in order to safeguard the interest of exporters in Pakistan, SBP has put in place all possible measures to minimise the allied risks.
Pakistan Apparel Forum’s proposals regarding amendment in various section of proposed bills pertains to shilling lines and freight forwarders which requires deliberations with shipping lines and freight forwarders in the light of international trade rules and practices. We propose that prior to finalising the current bills ministry of ports and shipping may obtain the views and comments of all stakeholders.
stakeholder concerns
The forum desired some amendments in the bill and they include: carrier bill of lading must be issued by carrier/master of vessel; ‘consignee of the goods’ should be replaced with ‘by the owner of the goods’; ‘any seaway bill’ should be deleted; the word ‘a seaway bill’ must be replaced by ‘carrier bill of lading’; and after the word ‘contract’ in the Section 3 the words ‘as instructed by the shipper (owner)’ should be added.
Jawed Bilwani, Chairman PAF, further said that if this bill is allowed it will open doors of malpractices by the freight forwarders in connivances with the shipping agents, therefore, it must be ensured that the instructions of the actual shipper (owner of the goods) are shown in all documents in each of the shipment.
