Pacific International Lines (PIL) Kenya Ltd has started haulage of the domestic cargo to Naivasha Inland Container Depot (ICD) on Through Bill of Lading (TBL) to allow importers near the town and other hinterland destinations enjoy use of Standard Gauge Railway line, which started cargo freight last month.
This follows a recent move by the Kenya government to revoke an earlier directive it had issued to have goods destined for Uganda, Rwanda and South Sudan to be ferried to SGR for onward transmissions.
Mr. Kaushik Bhattacharya who represents the owner of PIL in East & South Africa & Indian ocean Islands said that PIL is ready to allow importers to use TBL model, which names Naivasha as the final destination, where importers can pick the cargo and drop the empty containers.
“We have now opened TBL services to domestic importers and a tariff for that is already in place. We have embarked on marketing to increase TBL volumes to Naivasha,” Bhattacharya told Freight Logstics.
In 2018, Kenya Railways entered into an agreement with PIL Kenya Ltd, whose headquarters are based in Singapore, committing to support the service and continually market the use of the Madaraka Freight Service as the preferred mode of transport.
“This is a positive step towards increasing cargo transportation via the SGR. It is a sign that customers have started appreciating the type of service we are offering which basically aims to enhance transport and logistics in the region. The TBL model makes it easier for customers to even transport empty containers back to the port after delivery,” KR officials said during the signing ceremony that saw more cargo volume carried on TBL to ICD in Embakasi, Nairobi.
Kenya International Freight and Warehousing Association (KIFWA) Board of Directors recently asked the industry players to promote TBL for the Naivasha ICD bound cargo to cushion importers against high demurrage charges likely to be incurred on delay in delivery of empty containers.
In the latest move to attract shippers to use the Naivasha ICD, Kenya Railways reduced freight charges from $600 to $480 for a 20-foot container and from $850 to $680 for a 40-foot container. The Corporation reiterated that the railway line offers a service that is premised on safety, efficiency and reliability and extended the free storage period to 30 days.
In an earlier interview, the Kenya Ship Agents Association (KSAA) said that there is a lack of understanding on the difference between a TBL and Merchant Haulage procedures for import cargo, which has a huge effect on the transport cost.
The contract on international carriage of goods by sea has set clear guidelines on where the obligations of the shipping line commences and ends. Through Bill of Lading refers to a single bill of lading covering receipt of the cargo at the point of origin for delivery to the ultimate consignee at a named place in the hinterland, Embakasi Internal Container Depot (ICD) or Naivasha ICD in case of Kenya’s SGR.
In the Merchant Haulage Containerized cargo, the responsibility of the Shipping Line ceases upon discharge of the container at the Port. This is the point where the consignee takes delivery of their goods and is given a time frame in which to return the empty container to the Shipping Line.
Hence, when the Shipping Line hands over the container cargo to the consignee at the port, the consignee will need to sign a ‘Guarantee Form’ – indicating where and when they will return the container to.
For those using TBL at the ICDs, the responsibility of returning the container to the shipping line is minimized. The importer will need to adhere to the rules set out in the ‘Guarantee Form’ that the shipping lines issues when it hands over the container and the cargo to the consignee at ICD.
The ‘Guarantee Form’ clearly indicates where and when they will return the container to and the numbers of days they have in which to honour this agreement.
It should be noted that this time frame in which they must return the container is costed by the Shipping Line and included in the freight rate offered to the client. Once the consignee exceeds the ‘free days’ allowed, then the he is charged demurrage.
If the place of delivery on the ‘Guarantee Form’ is ICD, then upon delivery to that location, any storage accrued thereafter is on account of the shipping line.
In the Merchant Holding model, if the consignee returns the container at ICD yet the ‘Guarantee Form’ indicates ‘Mombasa empty depot’, then any storage time accrued by the empty container at ICD will be to the consignees account and not the Shipping Lines.
If the container is railed to ICDs or any hinterland destination, the merchant is liable to return the container to a named shipping line empty container depot, which means that he will incur the cost of transporting the empty container, either on road or rail.
SGR, which is rapidly gaining importance as a transport solution for large cargo consignments destined for Kenya and the region has to some extent succeeded in convincing shippers to adopt the TBL freight model.
