Absolve Freight Forwarders from transferred liabilities - Ex NAGAFF President pleads

By Abiodun OBA

A call to exonerate freight forwarders from wrongdoings in cargo transaction has been made.

The former President of the National Association of Government Approved Freight Forwarders (NAGAFF) Dr Eugene Nweke made the plea in his 2024 professional new year message.

Nweke charged the Federal Government to set in motion professional regulatory domestication processes that will encourage the culture of ‘Indemnity Letter’ application in shipping and cargo clearance transactions in Nigerian shipping and aviation spaces.

Indemnity Letter is an instrument that is meant to exonerate the freight forwarder of any wrongdoing in cargo transaction.

He argued that Freight Forwarders should not continue to be blamed for the atrocities and noncompliance committed by importers and Shippers. Freight Forwarders are only given the Bill of Lading (BOL).

He said that the domestication, integration and application of the Forwarding Instructions by the International Federation of Freight Forwarders (FIATA) or Shippers Instructions document and the combination with an “Idemnity letter” will absolve the Freight Forwarders from any undue transferred liabilities or potential losses, penalties, sanctions, among others.

According to him, the desired professional regulation will also boost compliance level with regards to national trade laws and cargo declaration for Customs purposes.

“It will improve professional integrity rating, it will be an added edge to booster specialities and competitiveness, especially so, in the face of requisite professional participation in the AfCTA implementation regime.

“It is a high time to resolve being proactive and take firm stands towards resisting undue, unhealthy professional name callings and negative industry placements by many stakeholders.

“Freight Forwarders must collectively and purposefully resist the common and quick referencing as a weaker link instead of stronger link in the international trade, safety and security supply chain.

“It is therefore, worth noting in this new year professional message that, the best time for a purposeful professional unification devoid of association nomenclature divides is now.

“The real time to buckle up and embrace professional realignment, strategic repositioning, taking back and regulatory effectiveness is now.

“Indeed, it must be clearly stated, that, on one hand, only those that has cargo interests comes into shipping industry, and going forward on the other hand, only those with cargo value addition should be allowed to come into freight forwarding and logistics services, thus, rekindling professionalism.

“To this extent, it must be reemphasised here, that, sound knowledge of cargo description, classification, dynamics of products natures, prompt applications of insurance and trades contracts & rules, judicious articulation of shipping documentation, shipping routes and time zones, etc is the beginning and bedrock of global trade compliance.

“Furthermore, though before now, it could be said that, as an established international norm, there is no international uniformity in documentary procedures for Freight Forwarding, and no consistency in the format and contents of the documents that are issued and used, except as may be agreed or as per recommended.

“However, for the avoidance of doubt, it must be stated that, the International Federation of Freight Forwarders Association (FIATA), has taken steps to promote the use of uniform documents in shipping, aviation and road transportation, in other to promote trade security and protect the Freight Forwarders from undue liabilities in the course of discharging their professional engagements.

“It is, therefore, incumbent for the Freight Forwarders to sit with the relevant authorities to agree for the domestication of applicable documentary procedures, with format and contents additions, in line with peculiarities. The present scenario is rather outdated and a self-professional defeat.

“At the moment, it is globally a professional provision and conscious application that, a Freight Forwarder embarking on any form of logistics exercise must have the basic understanding of the role performed and importance of applicable transport documents used in any contractual obligations and their requisite documentation processes and procedures.

“In view of these and in an attempt to cause deliberate professional redirection and changes, the Freight Forwarders have need to grasp deeply and to judiciously interrogate and integrate the intricacies and technicalities inherent in the four main functions of the Bill of Lading (BOL) usages.

“It is, therefore, obligatory to state that under the prevailing shipping practices in our shipping space, the Freight Forwarders are encouraged to stop taking imports or exports documentation for granted.

“To this effect, the Freight Forwarders Association and the Regulatory Council have a duty to go back to the drawing board, articulate or restructure, fine tune and set in motion professional regulatory domestication processes, that will encourage the use and promote the culture of IDEMNITY LETTER application in shipping and Cargo clearance transactions in our shipping and aviation space, so as to cushion the effects of shipping documentation intricacies, especially on the BOL usages.

“The canvass here is that a professional regulation should be legislated in such a manner that it will subtly compel the practitioners to embrace the provisions of the FIATA-Forwarders Document as it applies to Issuance of Requisite Documents to the Shippers when exporting:

▪︎ FIATA FCR: Forwarders Certificate of Receipt.

▪︎ FIATA FCT: Forwarders Certificate of Transport.

▪︎ FBL: Negotiable FIATA Multimodal Transport BOL.

▪︎ FWR: FIATA Warehouse Receipt.

■ Requisite Documents to Demand from Shippers When Importing:

▪︎ FFI: FIATA Forwarding Instructions or Shippers Instructions – Serving further Indemnity purposes.

▪︎ FIATA SDT: Shippers Declaration of Dangerous Goods.

PROFESSIONAL EMPHASIS:
PROFESSIONAL CAUTION:

By way of professional caution, though the new Customs laws stresses and provides for direct cargo processing and clearance by the Shippers under applicable conditions or the shippers choice of engaging a representative, however, Freight Forwarders who indulge themselves in the habit of creating import transactional pools for Shippers via official floating and registering of an importing or trading firms, all in a bid to maximize a professional monopoly, networth base and network, are hereby advised to reconsider their activities and operations under the prevailing circumstances.