Foreign shipping lines must now publicize fees

Foreign shipping lines must now publicize fees

Foreign shipping lines will have to publicize charges, surcharges of freight services for containerized goods, and port service charges from July 1, 2017.

The Vietnamese government officially issued Decree No. 146/2016/ND-CP late last year, mandating the publication of these charges after months of consideration.

“The decree will target containerized goods’ sea carriage.

Services for bulk shipments that are not containerized are not subject to this draft decree,” said an official of the Ministry of Transport (MoT).

The decree is expected to make the shipping market more transparent, ease the fee burden on Vietnamese import-export firms, and promote healthy competition.

There has been a recent spate of surcharges affecting Vietnamese exporters and importers – the subject of nearly 20 different surcharges since 2011.

The decree, which sets out the implementation of the amended Vietnam Maritime Code 2015, extends the scope of publication of port service fees in comparison with current rules.

To the code’s list, it will add charges, freight service surcharges for containerized goods, and service charges at port.

Currently, firms are obliged to publicize fees and surcharges of by-sea freight services in the Law on Price 2012, Decree 177/2013/ND-CP, and most recently, the Vietnam Maritime Code 2015, adopted by the National Assembly in November 2015 and taking effect on July 1, 2017.

However, in spite of these rulings, publication rules for shipping freight services have somehow slipped through the cracks.

Though port service charges must be publicized, most shipping firms have failed to do so on their websites, leading to objections among Vietnamese exporters and importers.

Shipping firms Mediterranean Shipping Company (MSC), CMA CGM, APL, and Neptune Oriel Lines (NOL) already made their objections known when MoT sought comments for the draft decree. 

They claimed that their business operations would be seriously affected.

According to MoT, although these surcharges are routinely collected in countries in line with international practice, in Vietnam this has proven problematic due to disagreement between foreign shipping lines and Vietnamese importers and exporters; and due to no previous notice of possible amounts of surcharges and schedules; and no specific agency to manage shipping surcharges.

In 2016, member companies of the Vietnam Textile and Garment Association accused foreign shipping lines like Evergreen, Hyundai, KMTC, SITC, Dong Jin Shipping, Continental, and Heung A of collecting unreasonable container imbalance charges. 

The Vietnam Maritime Administration’s statistics showed that as of October 2014, there were 40 foreign shipping companies doing business in Vietnam, in charge of approximately 88 per cent of the exports and imports of local enterprises.

In addition, 90 per cent of Vietnam’s exports and imports are shipped by foreign firms.

This number jumps to 100 per cent when considering containerized export goods for the European and American markets.

A report from the Ministry of Finance showed that of the VND77.12 trillion ($3.52 billion) that shipping agents collected for shipping firms in 2013-2014, more than VND26 trillion ($1.18 billion) came from surcharges.