Policy & Compliance
Incorporating BIFA Standard Trading Conditions 2025 Edition A key reason for freight forwarders and customs agents to join BIFA is to bene fi t from the protection offered by the Standard Trading Conditions (STC). In many ways they are the cornerstone of the relationship between BIFA and its valued Members
T he Standard Trading Conditions (STC), which were originally negotiated with the British Shippers Council, are legally comprehensive and balanced. The insurance industry is generally supportive of them because they de fi ne the freight forwarder’s liabilities, thus providing a degree of certainty when considering risk. The courts have upheld individual clauses when challenged, indicating their legal compliance. The reader must remember that it is essential to incorporate the STC into any client contracts to ensure that they (the BIFA Member) benefit from their protection. The BIFA STC have evolved since they were first introduced in 1988; initially they were largely a freight forwarding contract. As business has changed BIFA has noted Members’ increased involvement in customs- related matters, with an emphasis on customs clearance. This has been reflected in various editions of the BIFA STC. STC functions Nowadays, the STC fulfil several functions being: • A forwarding contract between freight forwarder and its client, • Empowerment to act as either a direct or indirect customs agent (Clause 7), • Authorisation for the BIFA Member to appoint a sub- agent where applicable to undertake customs clearance (Clause 7), • Warranty provided by the customer to the BIFA Member that the information provided is correct (Clause 18), • Indemnity from the client to the BIFA Member (Clause 20) for outgoings incurred when acting in line with the client’s instructions,
including tick boxes on websites and quotation systems where the customer indicates that it agrees the business transaction will be subject to the BIFA STC. It is important to emphasise that wherever possible the incorporation should include a positive acceptance of the terms. Circumstances will dictate what is the most appropriate method – the preferred option is an ‘original signature’ but others may be acceptable. It should be remembered that the STC cover both forwarding and customs activities, and that government has stricter criteria regarding evidence of empowerment to act as a customs agent (direct or indirect as per Clause 7 of the STC) than a company may agree to for a purely commercial transaction. The empowerment in Clause 7 is a useful fallback position, particularly for a one-off client. The Association’s strong recommendation to all Members is that, for repeat business, a separate empowerment in writing to act as a customs agent is obtained. BIFA’s Good Practice Guide on the Appointment and Responsibilities of a Customs Agent includes templates that can be used. Compliance viewpoint From a compliance viewpoint it should be made clear during the first contact with a client that “all business is transacted under the current edition of the BIFA STC”. It is advantageous to refer to the specific edition being used – currently it is the 2021 edition but this will soon be superseded by the 2025 edition. There must be documentation evidencing that the STC have been brought to the attention of the customer, who has accepted them. Certainly no business and/or guidance should be transacted until incorporation of them has been completed. This can be done in more than one way, dependent on a Member’s processes. Effectively:
“ It is important to emphasise that wherever possible the incorpor- ation should include a positive acceptance of the terms
• Definition of the time limits for clients to bring a claim (Clause 27) for loss or damage etc. BIFA receives enquiries to claims being made against Members under the terms of the STC. The first question that we always ask is, “Have you incorporated the STC in your contract with the client?”. In many cases there is a positive affirmation of correct incorporation. However, sometimes there is a lack of certainty as to whether or not the STC were correctly incorporated. Some Members have sophisticated electronic methods,
• Digitally via the Member’s IT systems, • Manually – which is usually in writing, • Verbally – only to be used as the last option. The Association’s strongest guidance is that the last-mentioned option is not to be used unless there is no alternative. It is also a very good idea to re-enforce the application of the STC in all communications and company- generated documentation with the customer, such as emails and system generated quotes. These should include a
12 | August 2025
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