Shipping & Logistics

Why new licensing rule is rubbing truckers wrong way

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Port of Mombasa. FILE PHOTO | NMG

Summary

  • Transporters have raised concern about a new licensing requirement at the Port of Mombasa, saying the move will push up the cost of operations.
  • Although the requirement has been lifted following a week-long negotiations, truckers say the licence, which the Kenya Revenue Authority ordered last week to be acquired before any truck is allowed to pick cargo at the port, should be shelved.
  • For now truckers will be allowed at the Port of Mombasa to pick cargo without the new License for Conveyance of Goods under customs control. KRA has temporariy made the waiver to allow further negotiations.

Transporters have raised concern about a new licensing requirement at the Port of Mombasa, saying the move will push up the cost of operations.

Although the requirement has been lifted following a week-long negotiations, truckers say the licence, which the Kenya Revenue Authority ordered last week to be acquired before any truck is allowed to pick cargo at the port, should be shelved.

For now truckers will be allowed at the Port of Mombasa to pick cargo without the new License for Conveyance of Goods under customs control. KRA has temporariy made the waiver to allow further negotiations.

Since February 15, the new licence rule has been in force, rubbing transporters the wrong way since they had to pay about Sh22,000 per truck to get the licence.

The Kenya Transporters Association (KTA) chief operations officer Mercy Ireri said although KRA has given them the waiver, they were yet to agree on how long it will take before the new licence applies.

"We are happy KRA has allowed us to the port after week-long negotiations but we are yet to get official communication stating the suspension will last for how many weeks," said Ms Ireri.

The transporters are reading mischief in the new rule, noting that introduction of the licence is meant to ensure that the number of truckers picking cargo at the port is reduced in favour of the Standard Gauge Railway (SGR) after government lost a case in court to direct all goods heading to Nairobi and other hinterland destinations to be ferried using SGR.

"We know it's a trick to punish transporters after government lost in the case which was ruled in favour of transporters to be allowed to pick cargo at the Port of Mombasa," said Musa Haji, a transporter in Mombasa.

"I have eleven trucks and with this directive, it means I have to pay Sh220,000 to get licence for all my trucks. We are urging the government to reduce Non-Tariff Barriers (NTBs) to make Port of Mombasa attractive to investors."

The Kenya International Freight and Warehousing Association (Kifwa) chairman Roy Mwanthi said they hope KRA will agree to suspend the directive for at least six months for further consultations and compliance.

Traders in East Africa, particularly those from Rwanda and Burundi, have been complaining of increasing NTBs along Northern Corridor forcing them to shift their focus to Dar es Salaam port.

In August 2020, Commissioner of Customs and Border Control informed all shippers and logistics stakeholders its intention to start implementing the directive but it was suspended for further consultation.

"The Commissioner of Customs and Border Control notifies all shippers, clearing agents, transporters and stakeholders in the conveyance of goods under customs control that pursuant to regulation 210 and 211 of The East Africa Community Customs Management Regulations 2010 that goods subject to customs control may only be conveyed by a vessel or vehicle licensed by the Commissioner for that purpose," read a public notice published on 7 August 2020.

In the notice, all stakeholders under the category were urged to familiarise themselves with the provisions of the said sections and ensure compliance within 14 days from the date of the notice but protest by transporters led KRA to suspend the order for further consultations.

To get the licence, truck owners are required to submit a number of documents to KRA customs including Sh22,000 bank receipt to prove payment before verification and certification.

Some of the documents required for the processing of Conveyance of Goods license include duly completed form C39, certified copy of trucks logbook, copy of valid National Transport and Safety Authority (NTSA) inspection report, PIN and tax clearance certificate (TCC) for individual company.

For foreign trucks, the owners are required to submit a certificte of incorporation for individual or company, copy of valid insurance sticker/Comesa certificate for foreign truck and truck inspection certificate by the Rapid Response Unit (RRU) team.