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Shipping & Logistics

Clearing agents brace for major changes in new regulations

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Proposed law seeks to radically change the way freight agents operate. FILE PHOTO | NMG 

Major changes are expected to happen in the clearing and forwarding sector as the Kenya Customs Agents and Freight Forwarders Management Bill adopted last week by all industry members is set to be tabled in Parliament in the next few days.

The Bill once passed into law will bring professionalism and discipline in the sector as strict measures and hefty penalties are set to ensure the industry, which has been operating without legal backing, is regulated.

According to the Bill, all clearing and forwarding agent and firms have to be vetted afresh before being licensed in the new law which is scheduled to be in place by early next year.

The Bill, which will be taken to the National Assembly Committee on Transport sometime next week, states that, "a person shall not engage in the practice as a customs clearing and freight forwarder unless that person has been issued with a practicing license and has complied with the requirements of this Act."

In the new rules, a person applying for a licence will be required to submit a certificate of continuous professional development issued by the Board, a statutory declaration confirming that no professional complainant has been made against him or her. They will also pay a prescribed fee.

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A practicing licence will be valid for one year and the board may suspend or cancel a permit in case of misconduct, that has been investigated and proven against a licensee by a disciplinary of a council which will be formed by the Act.

The new law is also expected to reduce cases of cargo loss. The handling freight company will be liable for such as loss of consignment as stated in the final draft seen by Shipping.

"A custom agent or freight forwarder who fails to exercise due care and diligence shall be liable to compensate the owner for the loss of or damage to the goods as well as for direct loss resulting from breach of the duty of care," reads the Bill.

The law will create the Custom Agents and Freight Forwarders Association of Kenya which will replace the current Kenya International Freight and Warehousing Association (Kifwa) and it will promote and protect the legitimate trade of clearing and forwarding agents, freight agents, warehousemen and such other trades.

Kifwa chairman Roy Mwanthi said the Bill is a domesticated East African model Bill known as The Model Customs Agents and Freight Forwarders Management Bill 2017 which will be implemented in all six East African countries. The regional Bill states the principles and values to be adopted in the six-member countries.

The Bill was piloted in Rwanda with support from the Japan International Cooperation Agency (JICA) about two years ago.

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