Thousands of uncollected containers face auction

Thousands of uncollected containers could be auctioned after a grace period of storage charge waiver handed to importers nearly two months ago expired on Tuesday.

The Kenya Revenue Authority (KRA) could not immediately give the number of containers cleared during the waiver period, with Ms Fatma Yusuf, the officer in charge of marketing and communication southern region, saying they were still compiling data.

KRA had on February 14 announced that the government would waive all charges accruing on storage of containers discharged at the port before November 30, 2014, provided they were cleared within 60 days.

“All such goods that will not have been removed from the port (Mombasa) and Container Freight Stations (CFSs) upon expiry of the 60-day notice shall be sold by public auction without further reference to the owners,” KRA said in the notice.

The move was prompted by the high number of containers lying at the port, some of which have remained at the facility for over 10 years, holding up space at the CFSs and port yards.

Overstayed containers

Multiple sources interviewed at the port by Shipping & Logistics indicated that the number of overstayed containers could be between 2,000 and 2,500.

According to information obtained from the Kenya Ports Authority (KPA), only 53 applications had been received for processing before release of containers.

Of these, 36 were for Uganda, 11 Kenya, two Rwanda and one Burundi, said a KPA official who declined to be named because he is not authorised to release the data.

But even as the waiver expires, the few containers cleared over the past 60 days have sparked controversy with a section of industry players saying the waiver was “cosmetic”, meant to open a window for illegal auctioning of containers and the cargo in them.

Some importers said they were yet to clear their cargo due to bureaucracy and refusal by some CFSs and shipping lines to waive the charges.

Mr George Kadima, the Uganda business representative in Mombasa, claimed that some CFSs were not offering the waiver as directed but gave a 20 per cent discount.

“Some containers have accrued over $200,000 (Sh18 million) yet the goods (in them) are not worth that much, so if one is given only 20 per cent discount it beats the logic of a waiver,” he said, adding that this was hindering the clearing process.

Mr Kadima said that since some shipping lines had declined to give the waiver, importers could not collect cargo that had accrued high fees.

However, CFS Association of Kenya executive officer Daniel Nzeki denied the claim, saying they had instructed all the facilities to waive the charges and that he was not aware of any manager who had refused to heed the call.

Once cargo has been delivered to its destination, empty containers are supposed to be returned to the shipping line within a period of 14 days for local and up to 45 days for transit cargo, failure to which it attracts a charge (called demurrage).

Shipping lines charge the fee differently. Mr Kadima said the fee ranges from $7 (Sh630) to $14 (Sh1,260) per day depending on the size of the container, with some shipping lines charging up to $50 (Sh4,600) for containers that have not been returned for years.

“Some shipping lines complied with the directive but others did not.

‘‘Also some importers in the interior parts of Uganda and Rwanda were not informed about the waiver early enough so I think there is need to extend it,” said Mr Kadima, adding that during the waiver period they had cleared less than 30 containers destined for Uganda.

But Kenya Ship Agents Association (KSAA) executive officer Juma Tellah defended the shipping lines, saying none had declined to offer the waiver as long as importers or their agents turned up with the correct documents.

“Some of them went to shipping lines with the notice as it was published in newspapers. They should know that proper procedures must be followed,” he said.

The Intergovernmental Standing Committee on Shipping (ISCOS) has also raised concern over the cargo, saying the presence of overstayed containers was causing congestion and inefficiency at the port and increasing the cost of doing business.

“ISCOS supports the initiative to decongest Mombasa port and advises all shippers with overstayed cargo to take advantage of the amnesty and clear it,” said Mr Kenneth Mwige, the organisation’s secretary.