Friday, 9 June, 2023

WSC for review of Bangladesh flag vessel rules

The council sent a letter to the state minister for shipping about delays and operational disruptions at Bangladesh ports

WSC for review of Bangladesh flag vessel rules

The World Shipping Council (WSC) expressed deep concerns over the vessel rules Bangladesh made recently.

The Council said that the new rule would create a number of problems for international freight management and reduce overall shipping services to and from Bangladesh.

The Singapore-based trade body of global shipping lines sent a letter to State Minister for Shipping Khalid Mahmud Chowdhury on May 4 referring to delays, congestion, and other operational disruptions at Bangladesh ports due to the updated rules.

In the letter, WSC authorities requested the government to review the Bangladesh Flag Vessel (Protection of Interest) Rule of 2023.

The international agency also sent a copy of the letter to Shipping Secretary Mustafa Kamal, Department of Shipping director general Nizamul Haque and World Shipping Council president John W Butler.

“As a global organisation representing international shipping lines, we express our deep concerns regarding the current 2023 Rule waiver regime and practices in Bangladesh,” read the letter signed by Kenneth Chia, managing director for Asia at WSC.

Daily Sun obtained a copy of the letter.

The 2023 Rule introduces new additional requirements with respect to the waiver process which are not contained in the 2019 Law, which unfortunately does not take into consideration the larger interests of foreign trade, it said.

The foreign-flagged vessels have been required to obtain a waiver for 100 percent of the cargoes they carry, despite the Act reserving only 50 percent for Bangladesh-flagged carriers operating on any route, the letter read.

The Ministry of Shipping issued the Bangladesh Flag Vessel (protection of interests) rule as per the Bangladesh Flag Vessels (Protection of Interest) Act 2019, which is framed with a provision of mandatory transportation of government-funded goods by the Bangladesh Shipping Corporation (BSC).

The rule says if the state-owned shipping corporation's ships are insufficient or if ships are unavailable, then government goods will be transported in accordance with the Public Procurement Act 2006, international laws, existing regulations concerned, and chartering committee's ground rules.

According to the letter of WSC, the 2023 Rule’s requirement for foreign-flagged carriers and foreign feeder vessels to apply for a waiver certificate on a case-by-case and voyage-by-voyage basis to the designated authority, with an application period of at least 15 working days before loading, is another significant impediment to them and trade in general.

The international platform of shipping lines expressed the industry’s “serious concerns” with the operation and implementation of the 2023 Rule, which was recently adopted pursuant to the 2019 Law.

The WSC acknowledged and appreciated that the purpose of the 2019 Law and its predecessors was to enhance the strength of Bangladesh’s national merchant marine.

But the consequences cast a substantial negative impact on Bangladesh importers and exporters, and ultimately the national economy which relies so heavily on foreign trade, according to the letter.

“We are concerned that such practices will not only harm Bangladesh’s foreign trade and flourishing export-oriented industry but may also set an unfavorable precedent that could be emulated by other countries, resulting in detrimental impacts to the entire global supply chain,” added the letter.

Regarding the concerns from the WSC, Shipping Secretary Mostafa Kamal said the ministry was yet to receive any letter from the Council regarding the 2023 rule.

“We are working on a policy which is better for the government. Until now, there was no letter that came to my desk (on the matter). We will think about it upon receiving such a letter,” Mostafa Kamal told the Daily Sun.

With offices in Asia, Europe, and the United States, the WSC has 20 ocean carrier members that represent approximately 90 percent of global liner vessel capacity.