BIFAlink is BIFA's monthly magazine covering issues of importance for the logistics and supply chain industry.
The magazine of the British International Freight Association December 2023 BIFA link Celebrating 400 issues of BIFAlink
INSIDE: Warehouse Operative Apprenticeships • New EU carbon rules • Abandoned containers • Looking beyond net-zero • Company transparency rules • Know your BIFA STC: Clause 21(A)
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Issue: 400
Steve Parker’s Column
BIFA membership – the gift that keeps on giving
BIFAlink is the official magazine of the British International Freight Association Redfern House, Browells Lane, Feltham TW13 7EP Tel: 020 8844 2266 (A company limited by guarantee. Registered in England: 00391973. VAT Registration: 216476363) Director General Steve Parker s.parker@bifa.org Member Policy & Compliance Director Robert Windsor r.windsor@bifa.org Member Support Director Spencer Stevenson s.stevenson@bifa.org Member Services Director Carl Hobbis c.hobbis@bifa.org Member Engagement Director Denise Hill d.hill@bifa.org International Relations Advisor Robert Keen r.keen@bifa.org Policy & Compliance Advisor – Customs Igor Popovics i.popovics@bifa.org Policy & Compliance Adviser – Sustainable Logistics Mike Jones m.jones@bifa.org Policy & Compliance Advisor – Air David Stroud d.stroud@bifa.org Editorial Co-ordinator Sharon Hammond s.hammond@bifa.org Membership Supervisor Sarah Milton s.milton@bifa.org Web site: www.bifa.org E-mail: bifa@bifa.org Published by Park Lane Publishing peter@parklanepublishingltd.com Contributors Steve Parker, Robert Windsor, David Stroud, Spencer Stevenson, Carl Hobbis, Sharon Hammond, Igor Popovics, Robert Keen, Denise Hill, Mike Jones Note to media: If you wish to use items in this magazine that are older than one month, please contact the editor to ensure that the item in question still reflects the current circumstances. Please be advised that BIFA DOES NOT OFFER LEGAL ADVICE. BIFA is not a law firm and the authors of this publication are not legally qualified and do not have any legal training. The guidance and assistance set out herein are based on BIFA’s own experience with the issues concerned and should not be in any circumstances regarded or relied upon as legal advice. It is strongly recommended that anyone considering further action based on the information contained in this publication should seek the advice of a qualified professional.
A s we come to Christmas and the end of the year, I thought it would be good to re fl ect on what BIFA has achieved in 2023. So, whether we celebrate the 400th edition of BIFAlink , the new Business Leaders Forums or other activities, let me say what a pleasure it has been to lead BIFA through the past 12 months and thank you for your warm welcome and keen engagement with BIFA.
As touched on above, and illustrated on the cover of this issue, we are celebrating the 400th edition of BIFAlink , which by the way, was so named in 1990 as the result of a competition won by Roy Baker who today is a Vice President at BIFA and remains involved in association affairs. You can read more about the topics covered in the most recent 100 issues of BIFAlink on pages 14-15. Two successful Business Leaders Forums were held during the year and this innovation will continue into 2024. Watch for the dates and sign up early to secure your spot. The BIFA policy and compliance team continues to move forward, having added sustainability and environment to its remit and created a new policy group on the subject. So, at the end of 2023 we now have five policy groups, who not only help to set policy for our industry, but also share good advice on the topics of the day, the biggest of which has been the difficult subject of direct versus indirect representation and establishment. Our Member engagement presence has grown too and as announced in this issue, we now have representation in Scotland completing our team of regional representatives covering the UK. Earlier in the year we held our 100th Young Forwarder Network event and, as the year ends, I have written 11 DG columns. With this in mind, I have created a little something which I hope you enjoy! The 12 days of Christmas (BIFA style). Sing along if you like! On the first day of Christmas BIFA gave to me, 12. Twelve Months of service
11. Eleven DG Columns 10. Ten Regional areas 9. Nine Virtual YFNs 8. Eight Are you direct? 7. Seven brand new staff
6. Six Training courses 5. Five Regional Reps 4. Four Policy groups 3. Three (free) support and advice
2. Two Leaders Forums 1. A copy of BIFAlink free
As ever, I welcome feedback and ideas from Members and encourage you to contact me by email at s.parker@bifa.org with your comments. All that remains now is for me to wish you and your teams a happy and peaceful Christmas and New Year and I look forward to seeing some of you at the BIFA Freight Service Awards ceremony in January.
Director General
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Industry News
IMO plans new rules on shipping lithium batteries Ian Matheson, from Impress Communications, reviews some recent news that might impact on Members’ business
Midlands and North route, serving Britain’s biggest container port, should be doubled and the route electrified throughout. ON THE QUAYSIDE A multi-million-pound project to expand the rail terminal at the port of Southampton is progressing, with Solent Stevedores taking possession of the second phase of an upgrade programme at its rail terminal in the Western Docks area. This includes connecting a further 6.5 acres of space to the existing rail terminal and laying a new track, whilst realignment of the existing rails has created two container sidings capable of servicing 640 m long trains and increasing the number of daily departure slots to 12. The Mumbai Maersk set a new record for the deepest- draught vessel to call at the port of Felixstowe when it arrived from Bremerhaven in mid-November with a draught of 16.8 m. It sailed 24 hours later with a draught of 17 m. IN THE AIR Global air cargo volumes and spot rates edged up marginally in October, but overall demand remained muted, diminishing hope of a traditional year-end revenue boost for airlines and freight forwarders, according to Xeneta’s latest weekly market analysis. IN BUSINESS A survey conducted by FourKites, the provider of supply chain visibility solutions, has revealed that almost two-thirds of business leaders in the UK and over 80% of those working in the USA list supply chain data connectivity as one of their top priorities. However, fewer than half were leveraging their supply chain data to inform their strategic direction and 14% were not using supply chain data at all to make decisions.
ON THE OCEAN Recent fires on board ships carrying electric-powered cars have prompted a rush to boost the protection of vessels. Heike Deggim, head of safety at the UN’s International Maritime Organization (IMO) warned that growing exports of battery powered vehicles pose a significant safety risk, adding that member states would draw up new rules next spring for shipping groups that transport vehicles powered by lithium-ion batteries. Container shipping’s bellwether, Maersk, announced a fresh wave of 3,500 job cuts in its Q3 2023
financial report as the global freight industry faces a “new normal” of tumbling prices, inflation and weak consumer demand. The redundancies added to the 6,500 job cuts announced earlier in the year. According to Greece’s Container News website, a whopping 230 million teu moved through Chinese ports between January and September 2023, an increase of 5.2% compared with the same period 12 months ago. The port of Shanghai maintained its position as the country’s most active container port, handling 36.19million teu during the period, whilst the port of
Yinkou stands out with the most significant year-on-year percentage increase in container throughput during the first nine months of the year, boasting growth of 19.6%. At a recent Xenata event, delegates discussed the uncertainties about freight rates for the next year, which are concerning both shippers and carriers as they consider committing to 12-month contracts – both in air and sea. One speaker suggested that one way to reduce risk is through index-linked agreements (ILAs), which save all parties a lot of time haggling over freight rates. Overland The European association of abnormal road transport and mobile cranes – ESTA – is stepping up its lobbying of authorities in Brussels to persuade them to strengthen the proposed revision of the Weights and Dimensions Directive 96/53/EC, which sets out the rules for heavy duty vehicles operating on Europe’s roads and related regulations governing heavy and abnormal transport. The revision presents a major opportunity for authorities to deal with the many difficulties being faced by transport operators while at the same time improving safety and the industry’s efficiency. The Chartered Institute of Logistics and Transport has published a 10-point plan following the cancellation of the Birmingham-Manchester leg of the HS2 rail project a month ago. It calls for an independent inquiry into what went wrong with the scheme, and recommends that the remaining single-track sections on the Felixstowe to
4 | December 2023
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Industry News
injury on the roads.” The evening also saw the presentation of awards, during which Robert Keen was recognised for services to Transaid while he was BIFA Director General. Aim and reach Transaid was founded 25 years ago by Save the Children, the Chartered Institute of Logistics and Transport (UK) and The Princess Royal. Its aim has always been to support people to build the skills they need to transform their lives – with a focus on improving road safety and increasing access to healthcare for rural communities. The entire Transaid team was in London to promote the organisation’s work, which currently spans nine countries, including professional driver training projects in Ghana, Mozambique, Sierra Leone, Tanzania, Uganda and Zambia. Transaid recently extended its motorcycle safety work with the FIA Foundation in Kenya. It is also working in South Africa and the UK to better understand the strategies that young men implement to keep themselves safe while walking to public transport in low- income areas. Appeal Transaid is now seeking the next phase of donor funding for its bicycle ambulance project in Zambia, which has been proven to dramatically reduce severe malaria mortality in children under six and is described by the World Health Organisation as being “feasible, safe and effective in hard-to-reach communities.” For more information about Transaid or to make a donation visit www.transaid.org
Steve Parker is introduced to HRH The Princess Royal, Patron of Transaid. L-R: Natalie Ganshert (account executive, Garnett Keeler), Steve Parker (BIFA), David Kennedy-Browne (director, corporate and social affairs, Maersk), Phil Roe (Transaid trustee), HRH The Princess Royal Congratulations Transaid
BIFA is proud to have been a corporate
member of Transaid since 2015 and was delighted to be invited to attend the 25th anniversary celebrations in November. Transaid celebrated its 25th anniversary last month with its largest ever showcase, attended by more than 170 industry supporters, partners and development organisations including Steve Parker, BIFA Director General, and Robert Keen, BIFA International Relations Manager. Transaid Patron HRH The Princess Royal addressed assembled guests, thanking them for their interest, enthusiasm and commitment to Transaid’s life-saving work. The event, held at the London Transport Museum, demonstrated the wealth of support for Transaid’s many projects, which have benefitted people in more than 20 countries,
Robert Keen (BIFA) and Caroline Barber, Transaid CEO
HRH The Princess Royal addresses the Transaid Annual Showcase
predominantly across sub- Saharan Africa. Caroline Barber, ceo of Transaid, said: “I am immensely proud of all that Transaid and our partners have delivered over 25 years.
We have grown the scale and impact of our work, improving access to healthcare services for communities in Africa, delivering pioneering road safety initiatives and working tirelessly to reduce death and
Scan the QR code to view Transaid’s 25th Anniversary film.
6 | December 2023
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Industry News
National Apprenticeship Week to highlight skills and achievements
National Apprenticeship Week (NAW) will take place from 5 to 11 February 2024, providing an opportunity for businesses to celebrate the achievements of apprentices around the country and the positive impact they make to communities, businesses and the wider economy. The Department for Education has announced that the theme for National Apprenticeship Week 2024 is ‘Skills for Life’. To stay up to date and to view the NAW toolkit that has
by encouraging everyone to consider how apprenticeships can help to provide #SkillsForLife. BIFA supports the role of apprentices across the industry and has seen the benefits that apprentices bring to their workplaces. If you would like to discuss apprenticeships and how they work, get in touch with Carl Hobbis at c.hobbis@bifa.org to set up a call.
been written to support the apprenticeship community with planning its activities, visit https://nationalapprenticeship
week.co.uk/ Individuals, employers, training providers and communities can get involved
Funding rise for Warehouse Operative Apprenticeship
The funding band for the Supply Chain Warehouse Operative Apprenticeship has been revised upwards to £5,000 from £3,000. The driving force behind the change, Jim French MBE, managing director Road to Logistics and co-chair Trailblazer Group Transport and Logistics, said: “The original apprenticeship was approved in 2016 when the new format of Apprenticeship Standards and End Point Assessments were introduced. “In revising the standard, the group has updated the ‘duties
and knowledge, skills and behaviours’ to be more representative of modern warehousing operations. The increase in the funding band should also make the apprenticeship far more attractive to both employers and new entrants looking for a career in logistics.” This is a positive step for apprenticeships in transport and logistics. It is another recruitment pathway for BIFA Members to consider and will help address the skills shortage across the sector.
The Limits of Liability for Carriers
In association with
£23.36 per kg By air – Warsaw Convention (17 SDR): £18.05 per kg
By sea – Hague Visby rules (2 SDR): £2.12 per kg £707.84 per package
BIFA STC: (2 SDR): £2.12 per kg
By road – CMR (8.33 SDR): £8.84 per kg
Insurance for the Marine & Logistics industries
(The SDR rate on 22 November 2023, according to the IMF website, was 1.06176)
By air – Montreal Convention (22 SDR):
+44 (0) 1628 532613
macbeths.co.uk
December 2023 | 7
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Policy & Compliance
seen as an auspicious day in BIFA’s history marking the Sustainable Logistics Policy Group launched Members attending the inaugural meeting discussed how the policy group can provide meaningful guidance on environmental and sustainability issues as they impact the UK and the international freight services industry “ By
sustainability expert and consultant to BIFA, gave a presentation about the wider business case and requirements of any supply chain, whilst Lucinda Maxwell, founders’ associate, from Pledge, delivered an interesting overview about calculating freight emissions and sustainability regulations. At the meeting, Director General Steve Parker emphasised the significance of this new policy group and urged those present to encourage other Members to attend future meetings. Different stages He said: “All BIFA Members are at different stages of their journey in regards to the development of policy that addresses environmental and sustainability issues within the supply chains that they manage. “By participating in this policy group, Members will be able to help shape best practice guidance and develop methods via which BIFA can represent Members’ interests on this subject in our interaction with government and other stakeholders that are developing legislation on the matter.” Due to the importance of this subject to their business, Members are urged to engage with the Sustainable Logistics Policy Group. The next meeting is in March 2024 and anyone wanting to attend should contact Mike Jones - m.jones@bifa.org
N ovember 16, 2023, will be fi rst meeting of the new Sustainable Logistics Policy Group, managed by Mike Jones, Policy Advisor Sustainability & Environment. Environmental and sustainability issues are not new and for many years BIFA has been monitoring the legislation, tracking any new regulations and delivering advice. Environmental issues Within the pages of BIFAlink , and on bifa.org, we have published numerous articles on various environmental issues such as plastic packaging and the problems surrounding its disposal, as well as the development of different fuel types and their respective merits and de-merits. Over time, the environmental agenda within freight and logistics has developed, and whilst the focus is often about carbon emissions, there are other wide- ranging generic issues. With all of the above in mind,
BIFA felt the need to establish a policy group to help identify and report to the Association and its Members on environmental- related issues that may in the future have an impact on their businesses, or in fact are already doing so. At the meeting, attendees discussed how the policy group could work to provide guidance to the association in order to deliver meaningful support on environmental and sustainability issues as they impact the UK and the international freight services industry. Future meetings will discuss how to agree and set the association’s policy on all issues concerning environmental matters. The date of the meeting also marked ‘Use Less Stuff Day’, which seemed like an appropriate time for the first meeting of a policy group established to help BIFA assist all of its Members, whatever their size, meet the ever-increasing challenges associated with environmental and sustainability issues within freight and logistics. Kelly Hobson of Shape Tomorrow,
participating in this policy group, Members will be able to help shape best practice guidance and develop methods via which BIFA can represent Members’ interests on this subject
8 | December 2023
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Wishing you all a very merry Christmas and a prosperous new year
From everyone at ASM
BIFA Awards
Last month they were each invited to an interview with the relevant judging panels where their personalities and enthusiasm for the industry shone through. The judges have now made their final decision and look forward to welcoming each of the finalists to the BIFA Awards luncheon ceremony on 18 January 2024 where the overall winners will be announced. The Ceremony The BIFA Freight Service Awards 2023 ceremony will take place at The Brewery in central London next month where sponsors, guests and BIFA Members will come together to celebrate the best in the industry across the 11 award categories. The afternoon will be hosted by queen of the pit lane Suzi Perry, who will hand out the awards alongside the sponsor representatives. The category sponsors are: • Albacore Systems • American Airlines Cargo • Boxtop Technologies • Descartes • IAG Cargo • Macbeth Insurance Brokers • Port Express • Thyme IT • TT Club
BIFA Awards – individual fi nalist shortlist unveiled The number and quality of submissions to the individual categories continues to improve year-on-year Young Freight Forwarder of the Year 2022 Thomas Frost (centre), of GEODIS Freight Forwarding UK, with event host Kevin Keegan and Joe Ellis of sponsor Virgin Atlantic Cargo
F or the fi rst time in the history of the BIFA Freight Service Awards, the announcement of the individual fi nalists was delayed in order to allow the review panel plenty of time to read and absorb the wonderful entries received in both the Apprentice of the Year and the Young Freight Forwarder of the Year Award categories. The number and quality of submissions to these categories improves year-on-year, making the task of selecting six finalists for each award ever more challenging. Late in October, and after much discussion, the following individuals were named:
WIN TICKETS For the chance to win two tickets to the sold-out ceremony, scan the QR code to enter the BIFAlink400 quiz.
Apprentice of the Year Award (sponsored by Menzies LLP) • Cameron Smith – Ligentia UK • Jacob Swift – Avocet Clearance • Kieran Elkin – Dachser • Leanne Read – Neon Freight • Richard Smith – Zeigler Group • Samuel Barrett – Charles Kendall Freight Young Freight Forwarder of the Year Award (sponsored by Virgin Atlantic Cargo) • Amelia Mulhern – Kuehne + Nagel • Chris Carter – Peterson (UK) • Emily Howard – Westbound Logistics Services • Georgia Gibson – cargo-partner • Michael Shiels – DHL Global Forwarding • Nikki Hall – Edge Worldwide Logistics
Ceremony sponsors BIFA is grateful to the following companies for their generous support for the event as ceremony sponsors:
“ The task of selecting six fi nalists for each award becomes ever more challenging
10 | December 2023
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Legal
Know your BIFA Standard Trading Conditions 2021 – Clause 21A
This month we reach Clause 21 which has four sub-clauses, A to D. Due to the length of the commentary on the sub- clauses, the article will be continued next month and only clause 21A is dealt with here
or counterclaim was yet again upheld in the case Britannia Distribution Ltd v Factor Pace Ltd [1998] 2 Lloyd’s Rep 420 , where it was stated that this rule applies to the carriage of goods by sea, land or air and that the rule cannot be circumvented unless there was a total failure of consideration – that is to say that the carriage was not performed. Thus, at English common law there is no right to reduction or deferment of freight charges on account of a claim or counterclaim, but to go further than the common law rule regarding unpaid freight charges and to cover all charges and outlays, the BIFA STC – especially Clause 21(A) must be incorporated in the contract with the Customer. Another factor to consider in respect of Clause 21(A) is that at English common law, for a counterclaim or set-off to operate as a valid defence, it must be so inseparably connected with the claim that it would be unjust to litigate one without the other (claim and counterclaim) – now referred to in the courts as a transaction counterclaim or transaction set-off in contrast to an independent counterclaim or independent set-off which must be actioned separately from the claim. The cases Dole Dried Fruit & Nut Co v Trusten Kerwood Ltd, Lloyd’s Law Rep [1990] 2 309, Glencore Grain v Argos Trading [1999] 2 Lloyd’s Rep 410 and Benford Ltd and Another v Lopecan SL [2004] 2 Lloyd’s Rep 618 refer. Thus Clause 21 (A) prevents even a transaction counterclaim or a transaction set-off from being a valid defence to a claim for unpaid charges, etc, made by the BIFA Member (unless the parties agree otherwise). In respect of the sale of goods, Clause 21(A) may be overridden by S.53 (1)(a) of the Sale of Goods Act 1979, by which a buyer may set up against the seller a breach of warranty in diminution or extinction of the price.
I t is not uncommon for a customer to be unaware of insurance when shipping goods and to refuse to pay charges due to its forwarder if goods are damaged. This issue, known as ‘set off’, has been considered in the Court of Appeal in 1998 (Schenkers Limited v Overland Shoes) . It was considered again and upheld in 2011 (Rohlig v Rock Unique) . Clause 21(A) The punctual receipt in full of sums falling due from the Customer to the Company is critical to the operation of the Company’s business and its performance of its obligations to the Customer. Accordingly, the Customer shall pay to the Company in cash, or as otherwise agreed, all sums when due, immediately and without reduction or deferment on account of any claim, counterclaim or set- off. Time is of the essence of payment of all and any sums payable by the Customer to the Company. Comment on Clause 21(A) A SET-OFF is a setting of cross- claims against each other to produce a balance. A COUNTERCLAIM is any claim that could be the subject of an independent action that is made against a Claimant by a Defendant. A counterclaim is called a ‘Part 20 Claim’ in the Civil Procedure Rules. It not infrequently happens that a Customer will try to obtain an arbitrary settlement of a claim or counterclaim by making a set-off, by refusing to pay charges, by making a deduction in payment, or by deferring payment. The purpose of Clause 21(A) is to overcome such action on the part of the Customer so that the BIFA Member
is paid in full when payment is due and the claim or counterclaim is dealt with as a separate matter. As explained below, under English common law, a carrier is in a privileged situation regarding the payment of earned freight charges which cannot be deducted or set- extends this principle, whether the BIFA Member acts as an agent or a Principal, to all charges and outlays including ancillary freight forwarding charges, Customs duties, etc. The general rule at English common law is that when there is defective performance of a off in respect of a claim or counterclaim. Clause 21(A) contract, a deduction in payment of the contract price may be made by way of abatement – Mondel v Steel, All ER Reprints [1835-1842] 511. However, the common law regarding the payment of freight charges is the exception to this general rule and in that respect the carrier is in a privileged position. This common law rule was reported to be well established in 19th century shipping cases and was affirmed in respect of sea freight in the relatively recent cases of Henriksens Rederi A/S v PHZ Rolimpex, All ER [1973] 3 58 , and Aries Tanker Corporation v Total Transport Ltd, All ER [1977] 1 398. This common law rule regarding freight charges was extended to road carriage under the CMR Convention in the important case of RH&D International Ltd v IAS Animal Air Services Ltd, All ER [1984] 2 203. The rule was further extended to road carriage within the United Kingdom by the case United Carriers Ltd v Heritage Food Group (UK) Ltd, Lloyd’s Rep [1995] 2 269, in which the judge reviewed the history and the application of the rule. The common law rule regarding freight charges being payable without any set-off, claim
“ At English common law there is no right to reduction or deferment of freight charges on account of a claim or counterclaim, but to go further than the common law rule regarding unpaid freight charges and to cover all charges and outlays, the BIFA STC – especially Clause 21(A) must be incorporated in the contract with the Customer
12 | December 2023
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BIFAlink
www.bifa.org The magazine of the British International Freight Association November 2023 BIFA Acting as a sub-agent: What’s your exposure to risk?
October 2018 The magazine of the British International Freight Association BIFA link Issue: 338
An overview of the Brexit Technical Notices – See page 10
INSIDE
6: News BIFA expands training team
9: Policy & Compliance GDPR and the BIFA Standard Trading Conditions
INSIDE: Liverpool Dinner • The impact of ETS on shipping • Can sustainability create value? • Award-winning Uniserve • A day to remember for YFN members • Know your BIFA STC: Clause 20
12: Profile Metro Shipping,
winner of last year’s Air Cargo Services Award
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Issue: 399
16: Policy & Compliance
Classification and safety data sheets
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BIFAlink celebrates 400 issues: The headlines and highlights The more things change, the more they stay the same
T he fi rst edition of BIFAlink appeared in September 1990 and 33 years later we are celebrating its 400th issue. It has been just over eight years since we marked the 300th edition of BIFAlink in the October 2015 issue with a detailed retrospective. This article will concentrate on the intervening eight years and some of the subject matter covered in the 100 issues since. Whilst some might say that the past is a foreign country, and they do things differently there, anyone flicking through the pages of the 100 issues since the 300th might come to the conclusion that there is some truth in the old adage that the more things change, the more they stay the same. Regularly recurring themes are a feature of many of the monthly issues. To name but a few: The BIFA Freight Service Awards; Changes to the UK’s Customs rules and systems; Health and Safety compliance issues;
Multimodal; Training; the Standard Trading Conditions (STC); Quality accreditation such as ISO and AEO; Technological advance across all modes; and vexatious issues in container shipping. Of course, almost every issue has had to provide coverage of the momentous changes to many working practices caused by the decision of the UK to leave the EU in 2016. Environmental policy 2015 saw an article on how to go about planning an environmental policy, which has been another recurring topic over the last 100 issues. It came to the fore this year with the appointment of a dedicated policy advisor to deal with the issues related to sustainable logistics; the establishment of a sustainable logistics policy group; and the partnership agreement with Pledge, which is seeing the latter
14 | December 2023
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BIFAlink
Customs procedures and the systems that underpin them, and it is expected that the subject will continue to be a prominent feature for many issues to come. Associated with that, we have used BIFAlink to support the other work we do to try to ensure that Members truly understand and assess the risks involved in acting as a Customs agent, either direct or indirect. The driver training and healthcare activities of Transaid, BIFA’s chosen charity for many years, have also featured regularly, and we celebrate the charity’s 25th anniversary with an article in this issue. BIFA’s training activities occupy many column inches and reflect on how our work in this area has developed over the last eight years, both in the variety of courses and how they are delivered. When the pandemic lockdown brought the highly successful regular training programme to a halt, we were able to use BIFAlink to advise how we were taking training online. Additionally, extensive coverage has been given to: the role of apprenticeships and the development of a freight forwarding specialist apprenticeship, and the launch of the innovative Young Forwarder Network in March 2019, a forum for early talent and those new to the industry. Standard Trading Conditions During the last eight years, BIFA’s Standard Trading Conditions have been updated; the publication gives a valuable platform to explain in detail each clause of the STC, which is a major benefit of BIFA membership, as well as to regularly reinforce the message that the protection provided by them can only be relied upon when they are correctly incorporated in commercial contracts. March 2022, saw the beginning of the latest round in a series of articles on the STC covering each of the 28 clauses in detail. BIFAlink continues to provide a useful medium for informative articles covering legal and insurance matters. The past 100 issues have regularly featured insight contributed by one of our associate members with specialist knowledge, for which the trade association is extremely grateful. The correct application of complicated legal issues such as liens, force majeure and switch or split bills of lading, feature significantly, as do the insurance considerations surrounding the handling of dangerous goods and the contentious issues of good cargo packing practices. We hope you enjoy reading BIFAlink , which is now available in its traditional paper format or digitally, and that its content is always of relevance to your work. It has often been seen as BIFA’s ‘Crown Jewels’, but we always welcome constructive criticism, as well as tips and suggestions that will help us to maintain the publication’s reputation. Contact Sharon Hammond (s.hammond@bifa.org) with your comments. We would like to end by thanking the companies that decide to promote their services by advertising in BIFAlink , some of whom have featured in every one of the last 100 issues, as well as in issues published before the 301st. We can only assume that the longevity of their advertising support means that their sales messages are getting through and bearing fruit.
provide articles on the environment and the work of logistics service providers. The Multimodal Exhibition and Conference has been a staple feature, often featuring on the front cover, and it has been interesting to see how BIFA’s presence and influence at the event has grown, with us now having our own freight village each year populated by BIFA Members. Freight Service Awards The BIFA Freight Service Awards also occupy considerable column inches of many of the last 100 issues, and the publication provides the perfect platform to promote the awards to Members, celebrate the finalists and winners, and showcase some of their excellent work. June 2016 saw the UK vote to leave the EU and the consequences of that decision for companies handling the UK’s trade with the EU has preoccupied the editorial team, as it has BIFA Members, for the last eight years and is likely to continue to do so. 2019 saw the first cases of COVID-19. The incredible impact of the pandemic on Members’ activities, as well as global supply chains, has also been a regular subject for the pages of BIFAlink, which never missed a publication during the various restrictions and lockdowns. Perhaps the issue that has been written about most often are the radical and ongoing changes to the UK’s
WIN TWO TICKETS TO THE SOLD- OUT BIFA AWARDS CEREMONY! To celebrate the 400th issue of BIFAlink , scan the QR code to enter our quiz. One winner will be drawn at random from the correct entries. Closing date 31 December 2023.
December 2023 | 15
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Policy & Compliance
Containers abandoned overseas: the charges you may face
BIFA Members continue to be surprised to receive demands for demurrage and quay rent from shipping lines when cargo is abandoned. How can forwarders minimise their risks?
O ne of the most frequent questions that BIFA receives regarding problems on maritime shipments is about export containers that are sitting at overseas ports unclaimed or abandoned. This sort of enquiry is particularly prevalent when there is an economic downturn or other market turbulence. Often the BIFA Member has closed the file with the goods shipped and carriage paid, and is surprised and concerned to receive a demand for demurrage and quay rent from the shipping line. Misunderstanding Often Members say: “But I am only an agent” or “but my name is not on the bill of lading”. We also see a variety of phrases such as “acting as an agent only” on pre-printed forwarder bills of lading, or similar wording as footers on correspondence issued by BIFA Members. Whilst in general terms anyone who undertakes a task for another could be called an agent, in law it is not what you say you are, but what you do that defines the role that you perform. Although some BIFA Members act as an agent on occasion, the majority of transactions that occur are where a freight forwarder buys
space from a shipping line or airline at one price and sells this on from its own tariff. In this scenario, the freight forwarder is a principal. If there is a later problem, for example, if the goods are not collected at the destination, then the shipping line will look to the freight forwarder for quay rent, etc, as the party it contracted with. Another issue is that if you have goods sitting overseas and neither the shipper nor the consignee can be contacted, you cannot always simply abandon the cargo. The shipping line will sometimes take a lien if the commodity is something that can be sold on easily. However, many commodities need specialist handling and in these instances the shipping line will look to the contracting party, the forwarder, for payment of such charges. It is impossible to safeguard against getting into this sort of situation if your file has been closed and the consignee does not take delivery at destination. The shipper, as your customer, has indemnified you against such outgoings under the BIFA Standard Trading Conditions (Clause 10) and is liable for such costs, but if they have ceased trading or simply gone away without trace, you as the forwarder, may find yourself liable for the unpaid charges.
Whilst BIFA Members will have to make their own commercial decisions, it is noteworthy that there appears to be a higher incidence of problems with one-off shippers, or where cargo is consigned to an agent where the Member has not previously had a trading relationship. It is less likely that consignments from a regular shipper to a regular consignee will cause a problem. However, if you have concerns regarding the standing of your customer, it is suggested that Members have office procedures to monitor shipped files or keep a log of when goods have been discharged overseas, which we understand may be difficult. Frequent comment One frequent comment from Members who find themselves in this situation is: “We thought that it would be alright as they had paid all the other charges up front.” Given freight rate volatility, it only needs a relatively short delay for quay rent and demurrage charges to accrue making the shipment no longer commercially viable. Having looked at the enquiries that we have received on this matter, the main commodities involved include scrap materials, personal effects and charity goods,
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Policy & Compliance
all of which tend to be low value. The question of high quay rent has attracted the attention of regulators during the recent pandemic. The Federal Maritime Commission (FMC) in the USA has been particularly active looking into such matters. This leads us onto an important piece of guidance: when advised by a shipping line of an unwelcome and probably large invoice, it is important to treat the matter seriously and to endeavour to reach a commercial settlement with the carrier. The line will probably quote the wide-ranging ‘Merchant Clause’ as the contractual clause for the basis for invoicing the charges to the export freight forwarder. Where the shipper is still contactable, it is important for the BIFA Member to advise it of the nature of the costs and its liability. Everything should be confirmed in writing. Whether the BIFA Member is acting as principal or agent, the client, by accepting the STC, expressly authorises the freight forwarder to enter into the relevant contracts to facilitate the
movement of the client’s cargo. Although Clauses 5 and 6 of the BIFA STC have different wording, they clearly express the sentiment that the forwarder can enter into relevant contracts with carriers, etc, “on any terms whatever”. Whilst trying to resolve the financial situation it is essential to consider what to do with the consignment to prevent further accrual of charges or cargo deterioration. Usually, the options are to abandon the cargo, return it to the shipper or to find a new buyer for the consignment, whether it be in the country of destination or elsewhere. Dif fi cult position In these situations, the freight forwarder is often in a difficult position facing a large invoice from a carrier which it has to pay but with little anticipation of being able to recover. The other sound piece of advice to follow is to speak to a suitably qualified solicitor to obtain advice
Member Renewal 2024 – Have you completed your online Renewal Declaration? During early November, Full Trading BIFA Members were emailed a reminder to complete the 2024 Renewal Declaration. In order to ensure that renewal invoices are correct and that the contact details on the website remain up to date, it is essential that the Renewal Declaration is completed as soon as possible. The completed form should be sent by email to Sarah Milton s.milton@bifa.org Changes of address, new offices or office closures should be notified to BIFA when they happen. Contact Sarah Milton with any changes that will affect your 2024 Renewal Invoice, including changes to the Finance contact details.
“ Whilst in general terms anyone who undertakes a task for another agent, in law it is not what you say you are, but could be called an what you do that de fi nes the role that you perform
on the legal position and to minimise any costs that the forwarder may be liable for.
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Policy & Compliance
As EU ETS free allowances are phased out between 2026 and 2034, the price of CBAM certificates should increase, providing the incentives for EU businesses to decarbonise their supply chain. Although CBAM will apply to six sectors initially, the intention is that all sectors covered by the EU ETS will be within scope of the CBAM by 2030. Customs representation – a warning for freight forwarders In the case of CBAM, Customs authorities will inform Customs declarants of their obligation to report information during the transitional period. BIFA has seen guidance stating that the Customs declarant will be the importer established in the EU. The issue for the EU forwarding/Customs agent is that increasingly complex question, what if there is no EU established importer to be responsible for reporting the CBAM information? BIFA has seen guidance which states that in those cases the Customs agent, as the indirect representative of the non- established importer, could be the party required to submit the emissions data. This would be a considerable additional responsibility and liability. We have to remind the reader that the emissions data that has to be filed will include all emissions incurred in the manufacture and transportation of the goods from origin, not just the relatively simple measurement for the journey from the UK to the EU. During the early stages this may not be too much of an issue due to the initial scope of the reporting requirement and the fact that the first industries required to report usually have EU-established entities to provide the relevant emissions data. However, when the scheme expands to more industries there is much greater scope for problems, particularly with e-commerce shipped on a DDP basis, where there is no EU established importer. The UK is considering similar legislation and BIFA has responded to the consultation stating that the Customs agent should not be the party to submit the carbon data. We have looked at the model for the Plastic Packaging Tax, arguing that it could be used as the basis for a UK CBAM.
How new EU carbon rules will affect UK businesses The EU’s Carbon Border Adjustment Mechanism aims to tackle carbon ‘leakage’. It has major implications for UK forwarders
T he European Union’s (EU) Carbon Border Adjustment Mechanism (CBAM) commenced its transitional phase on 1 October 2023, meaning that businesses exporting to the EU must prepare for the changes. CBAM is a policy developed by the EU to prevent ‘carbon leakage’, which shifts emissions outside of Europe and undermines EU and global climate efforts. Carbon leakage occurs when industries transfer polluting production to other countries with less stringent climate policies or when EU products are replaced by more carbon-intensive imports. The reason why carbon leakage may occur in the EU is that it has a carbon pricing system, the EU emissions trading scheme (ETS), which places a price on the emission of carbon in certain sectors. How does CBAM work? The CBAM places a price on carbon emissions of goods imported into the EU to bring the carbon price of those goods in line with goods manufactured within the EU and to ensure that importers pay the same carbon price as domestic producers under the EU ETS. Since the UK is no longer an EU member, this will impact UK shippers to the EU who will be required to provide carbon- related data to their EU-based customers. The CBAM applies initially to imports into the EU of goods whose production is carbon intensive and
at risk of carbon leakage. These in- scope goods include: • Cement
• Iron & Steel • Aluminium
• Fertilisers • Hydrogen • Electricity. Key milestones
During the transitional phase, EU importers of goods within scope of the CBAM will have to report greenhouse gas emissions embedded in their imports. However, no financial payment will be necessary. During the first year of implementation (2024), companies will be able to report emissions in one of three ways: • Full reporting according to the EU method, • Reporting based on equivalent third-country national schemes, • Reporting based on reference values. From 1 January 2025 the EU method, as set out in the implementing regulations for the EU CBAM, will be the only acceptable method. Once fully in place, as of 1 January 2026, importers will need to declare the quantity of goods imported into the EU in the preceding year and their embedded emissions. The importer will then surrender a corresponding number of CBAM certificates which will be priced depending on the weekly average auction price of EU ETS allowances.
“ BIFA has seen guidance which states that in certain the indirect represent- ative of the non- established importer, could be the party cases the Customs agent, as required to submit the emissions data
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Sustainable Logistics
Looking beyond net zero This month sustainability expert Kelly Hobson dives into the inter- connected topics that represent
environmental challenges for businesses to consider. Kelly explains that all future-facing business leaders should not only become more familiar with these topics but should consciously address them in their everyday decision making
M any organisations are on collating energy consumption data in direct response to climate change headlines. What tends to be missing is the knowledge to understand how to take that data and develop tangible steps to reduce a reliance on fossil fuels, whilst extending sustainable thinking across multiple areas to represent a currently tunnelling down rabbit holes, focused solely truly sustainable business model. In the UK the journey to net zero continues to be bumpy, with many barriers ahead that halt progress and dilute ambition. Without the right legislation and financial support from the UK government, we are unable to move at pace on energy reduction programmes within our industry. However, that should not be an excuse to avoid progressing within other environmental areas while we wait. Roadmap your journey To represent a truly sustainable business you must understand how your business is impacting our planet on a broader scale. Through a Materiality Assessment (a strategic business tool to assess environmental impact), the most significant impact areas for your business can be identified and future planning should directly explore how to reduce negative impact across your value chain. Of course, nothing happens overnight but it is important that a business moves forward with planning that demonstrates intent to clients and other key stakeholders.
positive impact of numerous businesses working together to reduce negative impact on our planet. That might be competitors, clients, NGOs or suppliers– the opportunities to create big waves of change are limitless. Directly related to clients, freight forwarders should not only be looking at ways to provide accurate emission data to their clients to capture scope 3 data, but empower them with intelligence that improves their future footprint. From supplier locations and packing requirements to consolidation and modal mix, there are multiple opportunities to add value as you decipher client data and regularly talk through short and long-term options. By improving your understanding of environmental topics, you are able to create genuine commercial value for your business and ensure you continue to lead a journey of success. For further information, contact Mike Jones (m.jones@bifa.org) Policy Advisor – Sustainability & Environment.
Consider every topic and create a three-to-five-year roadmap that prioritises the most impactful areas and outlines milestones for everyone to move towards – eg, “by January 2025 every site will send zero waste to landfill”. Sphere of in fl uence Due to the enormity of our impact on the environment, business leaders are encouraged to consider their sphere of influence and explore ways to collaborate and influence. We all know that two heads are better than one; imagine the To create a truly sustainable business model, a company must consider: • Climate change • Greenhouse gas (GHG) emissions • Resource depletion including water • Waste and pollution • Deforestation • Biodiversity
“ To represent a truly sustainable business you must understand how your business is impacting our planet on a broader scale – Kelly Hobson
December 2023 | 19
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Policy & Compliance
UK to tighten rules on company transparency in fraud clampdown
Part of new the Economic Crime and Corporate Transparency Act (2023) focuses on the oversight and transparency of company structures. Previous rules have allowed fraudulent operators to go undetected
oversight and transparency of company structures in the UK. It will be some time before the full impact of this long and complex document, totalling 376 pages, becomes clear. In addition, secondary legislation and system development will be required before all aspects of the legislation can be implemented. For instance, Companies House will need to implement a digital solution for identity verification of directors; therefore this may be one of the later measures to be implemented. The legislation will have impacts for UK businesses registered at Companies House, in particular the introduction of identity verification for all new registered company directors. The legislation will considerably enhance the role of Companies House for verifying company-related data. Domestically, UK-based companies will have to review their processes and the data provided to Companies House. But at the
O ne signi fi cant concern that BIFA Members consistently express is the dif fi culty in identifying those companies that may be operating fraudulently. The most frequently cited examples are where a Non- Established Taxable Party (NETP) fails to comply with Customs legislation leaving the UK freight forwarder, who has acted as an Indirect Customs Agent on an indirect basis, with a large and unwelcome bill. The British economy is commonly referred to as being ‘open’, but it has been clear for some time that this has led to a significant increase in non-compliance and, in some cases, fraudulent activity. In fact, GOV.UK comments that information contained within Companies House and HMRC
websites cannot be completely relied upon when determining whether or not a company is established within the UK. Company structures In order to combat what is seen as significant economic crime and the abuse of the register of companies, the government introduced The Economic Crime and Corporate Transparency Bill which, during October 2023 received Royal Assent and has now passed into UK law as the Economic Crime and Corporate Transparency Act (2023) (ECCTA) . While parts of the Act deal with broader aspects, including enforcement over crypto assets, money laundering and failure to prevent fraud, much of the legislation is concerned with the
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