By Veneranda Sumila, BusinessWeek reporter
*Dar es Salaam.*
When cargo is discharged from the ship, it must be tallied- and there
emanates a multi-billion industry for Tanzania, one of the richest “port”
nations in Africa, enjoying 10 major Indian Ocean ports and a host of
others in Lake Nyasa, Lake Tanganyika and Lake Victoria. The shipping
industry in Tanzania is a multibillion business, serving the country and
interests of several landlocked neighboring countries
Yet despite the importance of ship tally sub-sector in the shipping
industry, Tanzania has no proper regulations on how it operates, according
to Tanzania Shiptally Association (TASHITA).
TASHITA says that lack of proper regulations make the Shipping Agency Act
of 2002 one sided piece of legislation which only benefits worldwide based
shipping agents at the expense of the host country.
Shipping agents who are not necessarily authorized dealers for tallying are
left to check and ascertain cargo loading into or discharging from the ship
to physically establish whether the cargo conforms to the valid and
authorized export and import documents.
“This is a big loophole that could be denying Tanzania huge revenue in tax
collection,” TASHITA Vice Chairman Hezekiah Teveli BusinessWeek.
Since 2004 the association has been lobbying for formulation of proper
regulations that will guide the performance of the industry.
“So far all our efforts are yet to bear fruits. We have been raising our
argument that tallying in Tanzania is performed as in-house operations
and could be a a means to evade tax and deny the government revenue, but
the government is yet to act all this years,” said Mr Teveli.
He said that unscrupulous shipping lines’ agents now operate Ship tallying.
No wonder there are so many malpractices in major ports that range from
overloading, smuggling, theft and pilferage of cargo.
“This poses security risk and is an avenue for economic sabotage,” said Mr
Teveli. A position paper by TASHITA on revision of improved enforcement of
Shipping Agency Act of 2002 and Regulations’ reveals many shortcomings in
the ship tally industry, which must be dealt with for the country to
benefits from the industry.
According to the paper Ship tallying business is now largely under Shipping
Agents or their sister companies.
“As the name indicates, they are agents of shipping lines. They are
appointed by shipping lines and act in the interests of their principals.
They cannot serve the interests of their principles and at the same time
serve the interests of the host country,” notes the paper.
“Ship tallying services should therefore be performed by other parties
other than shipping agents and their sister companies. There should be
proper regulations in place to ensure that this is properly followed. Such
regulations are lacking in Tanzania.”
According to the study, Separation of services will facilitates curbing of
tax evasion by companies which are registered for doing one business but
ending up performing ship tallying, a business which they are not
officially licensed to operate.
In this way, according to the study, such companies do not pay any taxes on
ship tallying business, as they do it as just an in-house operation and not
as a tax payable business.
The paper indicates that Shipping Agency Act of 2002 is a one sided piece
of legislation and benefits shipping agents at the expense of the Tanzania.
Another challenge which afflicts the ship tally industry includes lack of
accurate and independent cargo statistics. “Independent ship tallying gives
unbiased data for the benefit of all parties,” says the study.
According to Mr Teveli, Independent ship tallies are also useful to
Insurers and Protection and Indemnity (PI) Clubs, as the accurate data
enables the proper calculation of payments for services offered by the
various parties.
It also facilitates proper calculation of taxes due for payment by the
different companies and individuals doing business within the shipping
industry.
The study also reveals that, lack of proper ship tally regulations is a
serious economic risk as Tanzania can easily suffer economic sabotage
through imports and exports frauds.
According to the paper, Shipping lines, which in Tanzania are mostly
foreign owned, have an immense influence over shipping services in
Tanzania. They extend their influence through their appointed agents, some
of which are their sister companies.
“This influence is vividly shown in the Shipping Agency Act of 2002 which
gives a lot of powers and discretion to the shipping agents who, of course,
are there to protect the interests of the foreign shipping lines.”
According to the study, the Act down plays all other services including
ship tallying which is very vital in protecting the interests of a country
and its citizens.
“All other services are placed at the mercy of the shipping agents. Ship
tally regulations would help to have a balanced control in the shipping
industry,” says the report.
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*Does Sumatra neglects some sub-sectors?*
* *
According to TASHITA the Surface and Maritime Regulatory Authority
(SUMATRA) has too many sectors to regulate which includes ports and
shipping services, maritime safety and security, rail and road transports
hence tend to neglect sub-sectors such as the ship cargo tallying.
Some services like ship tallying, cargo handling and valuation are
licensed by the Ministry of Industry, Trade and Marketing and not
SUMATRA. So how can the body regulate licensed operations by another
authority?
————————————–
Big business
International firms like Tanzania International Container Terminal
Services (TICTS) which handles a lot of business at the port is a
challenge affecting the ship tally industry in Tanzania, notes
TASHITA.
TASHITA position paper says TICTS is supposed to offer stevedoring
services for containerized cargo. It may perform tallying as an in
house service to obtain data pertaining to the cargo handled for
internal records.
However, in addition to the in house tallying, there should be
independent ship tallying from a third party which is a specialist
ship tallying company whose records can be recognized and accepted by
different interested parties.
* *
*More info;*
1961-1967: At independence and ship tally was a distinct business under
private operators within the shipping industry
1971- 1973: After Arusha Declaration, shipping industry nationalised,
Shipping Agencies placed under National Shipping Agencies Company (NASACO)
1975-1976: Ship tallying, an important and distinct business sub-sector
within the shipping industry, was taken over by NASACO.
1990- 2000: Trade liberalisation in Tanzania and the dissolution of NASACO.
The ship tallying business left hanging without proper regulation.
2002: The Shipping Agency Act enacted to fill in the statutory vacuum
covering shipping agency and other related services, including ship
tallying. Ship tallying services were not adequately taken care of in the
legislation.
2004: The establishment of the Surface and Marine Transport Regulatory
Authority (SUMATRA). SUMATRA unable to properly regulate ship tallying
business as there are no proper regulations in the legislation.
2005 -2013: TASHITA continue with its struggles to have ship tally business
operated in a proper manner by liaising with various stakeholders.