Freight fees to be listed

According to the latest draft decree, shipping firms would have to make their services more transparent-Photo: Le Toan

The Ministry of Transport’s draft decree sets out the implementation of the Vietnam Maritime Code 2015, which was adopted by the National Assembly in November 2015, and will take effect on July 1, 2017.

Accordingly, in addition to publicising surcharges of freight services for containerised goods, foreign shippers will have to publicise fees and charges of shipping freight services, and charges for port services for containerised goods.

“The submission was made based on current rules and international norms after months of seeking comments from other ministries, organisations, and businesses. It aims to put to an end to the unreasonable collection of surcharges among foreign shippers, and promote trade activities,” Nguyen Van Cong, Deputy Minister of Transport, told VIR.

The latest draft decree will only target containerised goods carriage activities by sea, while the services for bulk shipments that are not containerised are not the subject to this draft decree.

Under the Vietnam Maritime Code 2015, firms must publicise fees and charges as regulated in the Law on Prices, and surcharges of freight services as requested by the government. However, charges of shipping freight services are currently not subject to fee publication rules, as well as not fixed by the state. Charges for port services must be publicised, but most shipping firms failed to publicise them on their websites, leading to objections among Vietnamese exporters and importers.

“The issuance of this draft decree is necessary to make the shipping market more transparent, ease a fee burden for Vietnamese import-export firms, and promote healthy competition,” Cong added.

Vietnamese import-export firms have been subject to nearly 20 kinds of surcharge since 2011 due to disagreement between foreign shipping lines and Vietnamese importers and exporters, no previous notice of possible amounts of surcharges and schedules, and no specific agency to manage shipping surcharges.

Despite great efforts by the government, the situation has not improved much. These actions include the prime minister’s draft decision and a number of investigations. The latest came in April 2015, when 20 leading foreign shipping firms – mostly operating in big ports in Ho Chi Minh City, Haiphong, and Hanoi – were investigated.

More recently, in February 2016, members of the Vietnam Textile and Garment Association (Vitas) accused foreign shipping lines, including Evergreen, Hyundai, KMTC, SITC, Dong Jin Shipping, Continental, and Heung A of unreasonably collecting container imbalance charges.

But many shipping firms, including Mediterranean Shipping Company (MSC), CMA CGM, APL, and Neptune Oriel Lines (NOL), have opposed the proposals asking firms to declare their shipping fees, on the grounds that their business operations would be seriously affected.

According to the Vietnam Maritime Administration, 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. They account for 100 per cent of containerised export goods for European and American markets.

A recent report by the Ministry of Finance showed that, of the VND77.115 trillion ($3.52 billion) shipping agents collected for shipping firms during 2013-2014, more than VND26 trillion ($1.18 billion) came from surcharges.