Govt threatens legal action against THC violators

Govt threatens legal action against THC violators

The Jakarta Post, Jakarta

The government will soon report at least six foreign shipping
firms to the Corruption Eradication Commission (KPK), for
allegedly failing to comply with a new regulation to reduce
terminal handling charges (THC) at ports.

Based upon data from the Indonesian Council of Transportation
Servicers' Users (Depalindo), the six firms were found to have
been charging traders the old fees, despite a new ruling -- which
could mean that they have been taking "illegal fees", Minister of
Transportation Hatta Radjasa said on Friday.

"According to the Depalindo data, there are six companies that
have been requiring these illegal fees. So, for the time being,
we'll report these six companies (to the KPK)," Hatta said.

He did not identify any of the six companies.

The Indonesian National Shipowners Association (INSA), in a
report submitted to the ministry on Friday, said that only one of
the 38 foreign shipping lines' local agents here had adjusted
their THCs downward in compliance with the new ruling.

The government lowered on Nov. 1 the THC from US$150 to $95
per 20-foot container and from $230 to $145 for per 40-foot
container. The announcement was made through a ministerial letter
dated Oct. 28.

However, arguing that discussions were still underway with the
government on the issue, most of the shipping lines have yet to
comply with the new ruling.

In the port operation system, the THC covers the cost of
loading-unloading activities and the movement of goods to the
container area. The activities take place at the port and thus
any charge imposed on them is under the authority of the
government.

Such conditions allows the government to decide the container
handling charges (CHCs) -- which is a part of the THC -- and the
additional surcharges for problems that may occur during the
loading or unloading process.

Currently, Indonesian traders are paying the THC at the price
decided by an international conference of shipping lines -- $150
for a 20-foot container and $230 for a 40-foot container.

Hatta said that the main spirit of the move was to show that
the government was serious in implementing regulations it had
issued, which was aimed at reducing the burden on importers and
exporters and eventually making Indonesian products more
competitive in international markets.

INSA chairman Oentoro Surya meanwhile, suggested the
government review the operating licenses of those shipping lines
for refusing so far to apply the new fee.

At present, foreign shipping companies control about 96
percent of the shipments of products in and out of the country,
which averages about 6 million 20-foot container equivalent units
per year.