Rwanda to pilot legislation on freight forwarding

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Journey to have a legal framework to regulate freight forwarding industry is headed towards the final lap as the players identify Rwanda as the pilot country for action.

This is after the regional stakeholders developed a model bill to guide the East Africa partner states to come up with national legislations to streamline the industry, which has operated without clear guidelines and strong legal framework.

The initiative is led by the Federation of East African Freight Forwarders Associations (FEAFFA), the umbrella body representing freight forwarders in the East Africa, which has worked with other regional agencies to professionalize the sector.

The law will regulate individual practitioners, firms providing freight forwarding, trainers training institutions delivering freight forwarding courses, Mr. John Mathenge FEAFFA Executive Director told participants in the recently concluded Global Logistics Summit held in the Tanzanian capital, Dar Salaam.

Until in recent years, the industry faced challenges related to service delivery, professionalism and self-regulation compounded by the implementation of the Single Customs Territory (SCT) that expanded the scope of operations for customs clearing and freight forwarding agents in the region.

“The road to professionalism has made key milestone having trained over 6000 freight forwarders, code of conduct deployed, the standard of training and registration system having been set,” Mr. Mathenge told the conference.

Through collaboration with the East Africa Revenue Authorities and the EAC Directorates of Customs, FEAFFA developed the first ever practitioners’ training program for clearing agents- the East Africa Customs and Freight Forwarding Practising Certificate (EACFFPC). Training was rolled out in 2007 and it is now a compulsory requirement for practitioners.

One of the key proposals in the Model Bill is the creation of a competent authority in East Africa Community (EAC) to license customs clearing and freight forwarding practitioners. This law intends to create a competent authority that will regulate practice and conduct, and ensure the professionalism of the industry through registration.

“Several meetings recommended self-regulation and accreditation of the industry as the most suitable option. Development of the model bill was considered important in order to guarantee uniformity and harmony of the resultant national laws given that clearing and forwarding agents operate across borders,” Mr. Mathenge, told one of the validation meetings.

Currently, the only competent authority in East African Community (EAC) to license customs clearing and freight forwarding practitioners are the Customs Departments of the Revenue Authorities in the region. Also, FEAFFA board created the East Africa Customs Agents and Freight Forwarders Board to register the region’s agents and is headed by Merian Sebunya, a former FEAFFA president

Although the role of regulating clearing agents is provided for in the East Africa Community Customs Management Act (EACCMA), the role of the Freight Forwarders and customs agents have not been properly provided. The member countries are yet to develop regulations to operationalize the practicing of freight forwarders, exposing the industry to malpractices, corruption, lack of standards and compromised professionalism.

High competition in the market, according to drafters of the bill, leads to unfair pricing and practices which affect the integrity of both the customs and industry practitioners.

Today, there are many providers of clearing and forwarding programmes and courses at various levels from certificate, diploma, even degree such bachelors degree in Supply Chain Management offered by the Jomo Kenyatta University of Agriculture and Technology (JKUAT). Kenya School of Revenue Administration offers EACFFPC, Diploma in Customs, and Masters in Tax & Customs Administration with Moi University.

However, stakeholders have recommended their involvement in the design and delivery of these programmes and courses to ensure they address the needs of the industry. Kenya Revenue Authority (KRA) has taken lead in drafting a Bill for accreditation and self-regulation of the industry.