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Shipping & Logistics

Importers seek more clarity on consolidated cargo

Inland Container Depot in Nairobi. FILE PHOTO |
Inland Container Depot in Nairobi. FILE PHOTO | NMG 

Importers want Parliament to institute clear legislation on consolidation of cargo to avert confusion at the port and inland container depot (ICD).

The importers said currently they are faced with delays in clearance of their goods when a consolidator has issues with State agencies.

The traders are, therefore pushing for insertion of the words ‘at origin’ in the definition of consolidator in the Finance Bill 2019 to make clear the location where the cargo was put together.

This comes at a time the Kenya Revenue Authority (KRA) has vowed to go after tax cheats in cargo imported through consolidators.

“We are proposing ‘at origin’ to be added immediately after the words ‘form one consignment’ for clarity’s sake,” said the representatives of the Kenya Association of International Cargo Consolidators.

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If amended, the definition of consolidator will be “a person who assembles cargo belonging to various persons to form one consignment at origin which may be deconsolidated back into the original individual consignment for delivery to the respective cargo owners upon arrival at the destination port or the consolidator warehouse”.

Consolidated cargo refers to goods importers pool together to form one consignment, which is often declared as belonging to one importer at the port of destination or de-consolidated into the original individual consignments for delivery to the respective owners.

In May, President Kenyatta faulted the consolidators for contributing to the delays of containers at the ICD saying that only genuine consolidators gazetted after the vetting process would be allowed to work with the traders.

Small traders who had claimed to have at least 1,000 containers with consolidated goods had asked for intervention from the President after they ran into clearance headwinds at the port in May.

Sources within the port intimated that about 99 containers had no owners claiming them, while a few others had pending tax bills, keeping them longer at the port where they are likely to be auctioned.

Traders, who have since held two meetings with the Kenya Revenue Authority, had been given up to August 2 to clear them or be auctioned.

For consolidated cargo, verification is complicated by the fact that some importers collude with consolidators to evade taxes through under-declaration of cargo and importation of counterfeits.

This has forced the Kenya Bureau of Standards and KRA officials to intensify the crackdown through manual verification of each container and its cargo, a process that takes even months.

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