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Magazine Stories September Issue 2009
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Friday, 13 February 2009
AGILITY has established an Asia Pacific headquarters in Singapore and officially opened a state-of-the art regional distribution centre in the Lion City, in order to strengthen its presence in Asia and provide a platform for further growth in the region.
“Singapore is the established logistics hub for Asia and the leading global shipping centre in the region and it has long been our aim to strengthen Agility’s operational capabilities through opening a new RDC and by recognising the strategic importance of Singapore by establishing part of our Asia Pacific headquarters in the city state,” said Wolfgang Hollermann, Agility chief executive — Asia Pacific.
Chairman and managing director of Agility, Tarek Sultan, who presided over the opening of the new logistics hub, said: "Singapore is an important piece in Agility’s growth plans. We continue to grow our investments here because Singapore’s excellent connectivity and operating environment provides us an ideal platform to manage our growing regional presence. In the last few years we have also made sizeable investments locally, including the acquisition of Synergy, a leading oil and gas service logistics provider.”
The new 14,500 square metre five storey bonded facility at Changi North has three floors designed for an ambient temperature warehouse with two levels for warehousing and a conventional racking system and can hold a total of 6,500 pallet positions.
Logistics services available include inbound management and distribution, consolidation and finished goods management, merge-in-transit and cross dock operations, kitting to-line operations, RMA Programs, Reverse Logistics, Order Fulfilment and PO Management, Configuration and Built-to-Order management.
Agility has operated in Singapore since 1975 and the new facility brings the total warehouse space in the city to almost 50,000 square metres in five different locations, with a staff of more than 600. Key target industries in Singapore include automotive, hi-tech, fashion and retail, food and beverage, medical, industrial, chemicals and oil and gas.
The new regional HQ will consolidate many of the regional and global management teams for business units such as logistics, operations and fairs and events.
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Magazine Stories September Issue 2009
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Friday, 13 February 2009
A SINGLE national work queue for trade assurance was implemented by the New Zealand Customs Service in late April. Customs says the system will be much more efficient and cost-effective, avoiding unnecessary delays.
The new system is quite simple and evolved from Customs auditing its operational framework to find ways to better conduct business.
It will allow import entries stopped for compliance activity to be routed to wherever capacity exists to process them in the most expeditious manner.
This means that documentation will now be channelled by a work queue controller to wherever a trade assurance officer is available, which could well be elsewhere in the country.
“Integral to this initiative will be the submission of documentation to Trade Assurance by email,” Customs said in an advisory.
“To facilitate their entries being processed as efficiently as possible, brokers, regardless of their location, should ensure they check EDI responses from CusMod and email documents as soon as a request is received.”
A new national email address has been introduced: This email address is being protected from spambots. You need JavaScript enabled to view it..
Document files can be accepted in PDF format only; zipped format files will not be processed.
Subject lines must be kept simple to ensure quick and accurate handling: an IE code and number for new entries (goods uncleared or where the goods are cleared but still held due to a deficient delivery order), ADJ and number for adjustments to import entries and CAN and number for cancellation of import entries.
If including an additional message, it should be brief and to the point, Customs emphasises, although also noting that it wants to know anything relevant.
The Customs Service points to the additional benefits of minimising the financial and environmental costs involved with faxing documents.
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Magazine Stories September Issue 2009
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Friday, 13 February 2009
THE WORLD’s press has been full of the words and sentiment expressed at the recent G20 Summit in London. One of the outcomes from the Summit was the issue of a communique from the G 20 leaders on 4 April 2009 setting out a list of measures aimed at stopping the world’s economy from falling further into recession. Part of those measures was a commitment to assist international trade and resist the obvious temptation to resort to protectionist measures.
The Trade parts of the G20 communique
The communique contained a number of specific commitments from the G20 leaders some of which can be summarised as follows
• To refrain from raising new barriers (including no new import or export restrictions and no WTO inconsistent measures
• That there should be no fiscal protectionism and no restraints on capital flows
• To notify the WTO of protectionist measures adopted by any country
• To promote and facilitate trade and investment
• To provide US$250 billion over 2 years to support trade finance
• To complete the WTO Doha Round
The WCO response
The World Customs Organisation (WCO) is one of the main bodies tasked to facilitate international trade as it represents customs organisations throughout the world . Clearly, national governments, through their Customs organisations, have a direct role in the facilitation of trade through the imposition and collection of revenue on imports and the imposition and administration of border controls such as the physical inspection of goods and quarantine measures.
The WCO responded to the G20 communique with one of its own. This endorsed the comments and proposed measures of the G20 and made a number of its own observations, including the following:
• It noted declining trade volumes (imports and exports)
• The reduction in duties being collected would have a particularly adverse effect on developing countries
• That the availability of trade finance was declining
• That there had been some positive responses in some jurisdictions with deferred duty collection, looser repayment plans, faster duty drawback and flexibility for security (guarantee) requirements
• The adoption of some improved Customs modernisation programs
• That some countries had been slow to adjust revenue targets with a consequent increase in the physical inspection of cargo to determine if goods were of the type on which duty was payable
• That there had been an increase in some anti-facilitation measures (unnecessary physical inspection and the adoption of new local standards)
The WCO communique also contained a number of recommendations including:
• That there be an increase in Customs to Customs co-operation such as that contemplated by the WCO SAFE Framework to facilitate trade
• To promote risk management and other trade facilitation measures and focus intervention on illegal activities such as “pirated” goods
• That Customs authorities consult and work with Trade Ministries
• That there be an improvement in Customs- to-Business Partnerships ( such as the AEO concept and other measures contemplated by the SAFE Framework)
• The use of consolidated border management regulation with one only place of reporting
• To use deferred duty payment schemes
• The adoption of increased flexibility in the types of guarantee security required by Customs authorities
The Australian context
Clearly, our Government has been to the fore with these initiatives. Our Prime Minister was part of the G20 Summit and Australia has for many years been a leading figure at the WCO and has actively engaged with many WCO initiatives. As a result it will be interesting to see how Australia responds to the comments and recommendations contained in the G20 and WCO communiques.
The next Federal Budget will give some clear guidance here, as it will provide an insight into the views of our Government as to reductions in trade levels and the associated reduction of revenue collected by Customs authorities. It should also provide some insight into the fate of some programs and measures of the type recommended by the WCO to facilitate trade. However it is worth noting that the recent history has shown that those measures may not have a place in our jurisdiction. For example
• The proposed introduction of deferred recovery of customs duty has had a long and unhappy history and there seems no immediate prospect of it being delivered other than in the “hybrid” fashion now in place which seems to have little support. The full duty deferral model, consistent with GST practice was very much the preferred model which could not be delivered.
• Following a review by Australian Customs it had been determined that the costs of an AEO program outweighed the benefits of its introduction so that it will not be introduced. However, Australian Customs had affirmed that its introduction will be re-considered should it prove that the lack of an AEO program was hindering Australian traders
• Following a separate review by Australian Customs, the increased use of RFID and the UCR would not be pursued, again as costs outweighed benefits
• Our proposed “Customs to Business Partnership” in the Accredited Client Program has also had an unhappy history tied to the inability of Australian Customs to deliver the full duty deferral model which had been part of the original proposal. This leaves “Frontline” as the main Industry engagement program which is, of course, more aimed at illegal trade across the border.
• We still have border management regulation which entails reporting to a number of different agencies at the same time and potential penalties payable to each agency for errors in reporting – even if inadvertent. The “single window” concept has been discussed for years but does not appear any closer. To the same effect, the development of a “Standardised Data Set” for one set of information to be provided to all border agencies still seems some time away despite all the good work which has been done on the project.
• The WCO has called for increased use of the “Modernization” in all customs authorities. This is consistent with the revised ‘OK Convention on the Simplification and Harmonisation of Customs’ procedures to which Australia is a signatory. This underpinned, in part, the CMR/ICS reforms. However, in a larger sense, such a process would cover total reform of regulations that are responsibility of Australian Customs. That would include a total reform of the Customs Act 1901 which is groaning under the weight of complex amendments over the years. The recent Time Release Study conducted by Australian Customs did reflect that cargo was released promptly in the majority of cases. While this is an excellent result, it does rely, in part on industry’s compliance with its reporting obligations and its readers should not infer that there is no room for improvement especially in areas where there are acknowledged problems!
Unfortunately given the state of the GFC, the associated leakage of revenue to Government and the priority to other interesting and speculative projects, those initiatives which the G20 and the WCO have endorsed and recommended may have little real prospect of adoption in Australia in the short to medium term.
- by Andrew Hudson - Partner, Hunt & Hunt Lawyers.
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Magazine Stories September Issue 2009
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Friday, 13 February 2009
WELLINGTON Airport, New Zealand’s just-announced plan to spend NZ$450 million on a major redevelopment project aims for a substantial increase in cargo throughput. However, there is only a passing provision in the plan for new or expanded cargo handling facilities.
The draft 2030 Master Plan envisages 28,200 tonnes of domestic and international air cargo being processed that year, a hefty increase on the approximately 5000 tonnes put through in 2008.
Passengers are forecast to more than double, from last year’s 5 million to 10.5 million in 2030.
The plan is predicated largely on the introduction of new aircraft types such as the Boeing 787 and Airbus 350 which the airport company believes “will offer fresh opportunities for Wellington to join the global air travel network with direct connections to new markets.
“These aircraft bring more than extended range; they also offer improved fuel efficiency. Their arrival in Wellington for long-haul and trans-Tasman routes will have a major influence on our future development.”
Wellington has high hopes of gaining direct air routes to Asian ports.
The master plan calls for runway improvements, extra aircraft parking stands, additional terminal space, extended retail space and car parks.
The airport’s very small site limits the opportunities for other commercial development, especially an air park which could contribute freight. However, despite being in the heart of the capital, Wellington does have an extensive commercial/industrial catchment area, including the top end of the South Island from which high-value produce is sourced.
Consultant projections suggest that the 28,200 tonnes goal will require cargo terminal facilities with a total floor area of 2800 square metres, complemented by landside loading docks and similar requirements, as well as airside staging areas.
“This means we need to make sure we have around 6000 to 7000 square metres for cargo space by 2010,” says the master plan says.
“We expect to cope with cargo volumes until well after 2020, but by 2030 we may have to move or reconfigure the current cargo-related leases to cope with anticipated growth in cargo volumes and apron area.”
Because of its runway length (which may be extended eventually but is not included in the 2030 planning, other than being acknowledged as a future possibility) Wellington Airport has little scope for heavy freighters on international operations, although it does handle domestic all-freight flights.
On the web: www.wellington-airport.co.nz
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Magazine Stories September Issue 2009
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Friday, 13 February 2009
THOSE in the industry are used to dealing with the traditional regulators such as the Australian Customs and Border Protection Service (as it is now known), AQIS and the Office of Transport Security.
At the same time, the industry has become increasingly aware of the level of regulation by the Australian Competition and Consumer Commission (ACCC). That regulation has been very pronounced with the actions by the ACCC and its overseas counterparts in relation to alleged price fixing by those providing air cargo services. However, two recent initiatives will have more immediate impact for those businesses in the industry.
Clarity in Pricing Act
The Trade Practices Amendment (Clarity in Pricing) Act 2008 (Cth) repealed the existing section 53C of the Trade Practices Act 1974 (Cth) (TPA) and substituted a new section 53C into the TPA with effect from 25 May 2009. The purpose of the amendments is to prevent businesses from misleading consumers through the use of component pricing, which is the practice of pricing goods and services as the sum of multiple parts.
If you are supplying or promoting goods or services to consumers, you must specify a single price which must include:
1. charges of any description payable by the consumer (excluding optional charges); and
2. any tax, duty, fee, levy or charge in relation to the supply; but it is not required to include:
3. optional charges, for example, a credit card surcharge will not need to be included in the single price where there are alternative payment options but it must be included in the single price where there is no other method for payment and
4. charges that are payable in relation to sending the goods to the consumer (eg. postage, courier fees), however, where such charges must be paid by a consumer and the amount of these charges is known, you must disclose the minimum of those charges as a separate component of price (eg. A$55 plus a$20 freight).
ACCC clarifies new component pricing requirements
The ACCC has released an information guide, News for business — Component price advertising, to explain the application of the TPA to business.
In addition to the general guide, the ACCC has launched a “Component pricing” page on its website (http://www.accc.gov.au) and has issued industry-specific guides for the motor vehicle industry, the travel industry and a guide for electrical goods, whitegoods and furniture advertising.
The ACCC has confirmed that the prohibition does not apply to representations made exclusively to businesses. However, you might find that your company inadvertently promotes its goods or services to consumers. You may not have any control over who looks at a price list on your website.
The TPA will require the single price to be “at least as prominent” as the most prominently displayed component of the price. The ACCC has said that a “prominent” price is one that stands out to a consumer, is clear, eye-catching and noticeable.
The ACCC has also noted that where a total price is not quantifiable but a minimum total price is known you must disclose the minimum price as a single figure and advise the consumer that not all components are included in the minimum price.
What you need to do?
Readers should read Hunt & Hunt Updates, the ACCC website and review current pricing practices to ensure observance with the new obligations. Clearly, we would be delighted to assist.
This is extremely important as the ACCC has already flagged strict enforcement.
Fairness in contracting
On 11 May 2009, the assistant treasurer Chris Bowen released the draft national unfair contract terms provision for public comment. The consultation paper on the proposed legislation is available at the treasury website:
http://www.treasury.gov.au/contentitem.asp?Navld=037&ContentID=1537
The new provisions are intended to be introduced to Parliament in the Winter sittings (June 2009), for commencement on 1 January 2010. The final legislation will also include new enforcement powers for the ACCC, but these are not included in the exposure draft attached to the consultation paper.
Exposure draft of the legislation
In summary, so far as unfair contract terms are concerned, the exposure draft of the legislation provides that:
1. An unfair term of a standard form contract is void but the rest of the contract will continue to bind the parties if it is capable of operating without the unfair term;
2. A term of a standard form contract is unfair if:
(a) it would cause a significant imbalance in the parties’ rights and obligations arising under the contract; and
(b) it is not reasonably necessary in order to protect the legitimate interests of the party who would be advantaged by the term.
3. In deciding whether a term of a contract is unfair a court can take into account matters it considers relevant but must take into account the following:
(a) the potential for the term to cause financial or other detriment to a party if it was applied or relied on;
(b) the extent to which the term is expressed in plain language, is legible, is presented clearly, and is readily available to any party affected by it; and
(c) the contract as a whole.
Examples of unfair terms
The draft legislation also contains a (non-exhaustive) list of 14 examples of the kinds of terms of a standard form contract. That may be considered unfair. Nine of these relate to terms that have a unilateral effect - these are terms that allow only one of the parties to control the contract, its terms, any variation or assignment without the consent of the other party.
Other examples of unfair terms may be prescribed in the regulations.
It is important to note that particular circumstances may justify the use of such terms and that the regulations may also prescribe terms that are prohibited.
If the legislation comes into force, existing contracts will not be affected, but contracts entered into after 1 January 2010 will be affected, as will those that are renewed or varied after that date. Again, steps to ensure compliance will need to be taken very early.
