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The Ship Owners and Agents Association of Ghana (SOAAG) has debunked accusations from freight forwarders and traders that shipping lines were contravening the Bank of Ghana’s (BOG) regulations and charging for their services in US dollars.
Mr Adam Imoru Ayarna, Executive Member of SOAAG, responding to some issues raised by the freight forwarders, noted that “there is a difference between pegging something in dollars and charging in dollars.”
Mr Ayarna said such accusations must be situated in the right context, explaining that freight was not the local agency’s income but was collected on behalf of a foreign principal based on the contract they had with the shipper.
“When it comes to freight, it will be pegged on a certain rate and invoice in dollars; the containers are not for the shipping agents; that revenue is for the principal. I am giving you this container, and this is what I will charge. It comes to Ghana, and the law says we should charge in Ghana cedis. If he does not peg it to the dollar, how will he convert it to a rate of exchange? That is my reason for saying that pegging something in dollars and charging in dollars are two different things,” he added.
He questioned that if the BOG did not use a rate of exchange to convert the value of the country’s import, how would they get the figure for the imports, stressing that they would have to use a certain measure to convert it.
“If I am a trader and I have bought something and am going back to buy it, will I use the cedi? I will have to use a certain rate to convert it to get the amount to buy,” he emphasised.
Touching on compliance to provisions of Regulations five of the Ghana Shippers’ Authority Regulations, 2012 (L.I. 2190) on negotiation of charges, SOAAG noted that setting of rates is done independently by shipping lines.
The regulation enjoins the GSA to negotiate on behalf of shippers with associations of shipping service providers, charges of shipowners, shipping lines and agents, port charges, terminal and shore handling charges, charges of freight consolidators, and charges for receipt, among others.
“We have been clear that when it comes to setting rates by the various ship agents, it is done independently because all of them have a different cost base. So how will the association that they belong to, which is SOAAG, and stakeholders sit and negotiate with GSA on behalf of the individual?” he questioned.
The SOAAG Executive Member said just as the GSA does not group the shipping lines in negotiating for cocoa freight under ‘Cocoa Freight Negotiation,’ which gives the opportunity for each shipping line to independently go and dialogue with them on their cost base, the same way his outfit cannot negotiate anything on behalf of the companies.
Mr Ayarna indicated that what the association could do was talk of the principles of shipping, stating that “if the lines are not abiding by the principles, we can talk about that; everybody is a legal and private entity, but definitely if there are some charges that are way up, everybody will see that it is way out. Shipping is a business of conscience, and at the end of the day, the shipping line has the final consumer also at heart, so when these things come up, it comes back to dialogue.”
He added that from their perspective, what they could do when anything comes up on charges was to first go to the line responsible and ask for the reason behind the charges, especially if it was a new charge or increment.
He explained that there was an understanding that when shipping lines were increasing their local incident fee (which means the cost happened in Ghana), they were supposed to notify the market, their customers, and the GSA at the same time.
“No shipping line can increase a fee without informing the customers that use their service, so in shipping, there is a minimum window of 30 days that you must inform your customers if it is in dire need, but most of the time it is three months’ notice.
So, GSA is informed that if GSA has any issue or they do not agree, they should quickly write to the shipping line and ask for clarification, and the shipping line is obliged to do so, and that has been happening. The shipping lines inform the GSA and the customers when there is any increase in service level, and they explain why.
Source: GNA
