Kenya: Port Set to Auction Goods As Surchage Waiver Expires
Monday, 27 February 2012 | 00:00
The Kenya Ports Authority (KPA) will auction containers that have stayed for more than 100 days at the port of Mombasa after a special waiver on storage charges failed to entice owners to collect them.
KPA had in December announced it would waive storage charges on overstayed containers if their owners collected them by March 1,2012, as part of efforts to clear congestion that is affecting the clearance of goods through the facilityBut with only a week to the deadline, more than 200 containers are still at the port amid growing protest by traders inconvenienced by congestion.
"There has been no major impact since," Mr Yobesh Oyaro, KPA's head of procurement and supplies said in reference to the waiver granted on storage charges.
"KPA will hire auctioneers to dispose of these containers when the need arises," he said.
KPA yesterday placed bids for auctioneers to help dispose of the overstayed cargo both within the port and the inland container depots (ICDs).
Managing director Gichiri Ndua said in December that KPA had identified 466 export containers, 737 domestic import and 294 transit export containers that have been lying at the port of Mombasa for between 100 and more than 1,000 days.
But importers played down KPA's offer and indicated that failure to waive the warehouse charges -- 30 US cents per cubic metre per day -- would render the concession on storage fees meaningless.
The Kenya Revenue Authority declined the request by the importer and said it would not grant a general waiver on warehousing for overstayed cargo because the law only allows this on application by importers explaining the reasons for delay.
"Customs Warehouse Rent (CWR) is part of government revenue and unless the law is changed, we cannot give a general waiver," outgoing KRA Commissioner General Michael Waweru told port stakeholders after the launch of a Rapid Results Initiative aimed at decongesting the port within 100 days.
Custom procedures are regulated through the East Africa Community Customs Management Act (EACCMA).
The port of Mombasa is currently experiencing cargo congestion which KPA attributed to lack of space following delays by importers and clearing agents to collect their containers from the port and the various container freight stations (CFS) in good time.
The port is important to the economic mainstay of the regions, for besides Kenya, it also serves several neighbouring landlocked nations including Uganda, Rwanda and Burundi, which rely on it for clearance of vital commodities and oil.
But a rebound in economic activity supported by booms in key sectors such as real estate have put facilities at the port under strain as developers placed bigger orders to support their businesses.
In an attempt to stop delayed collection of cargo, KPA last month said it will from February slash the period during which importers are allowed to keep their goods at the port without attracting surcharges.
The free storage period for domestic import containers will be reduced from five days to four while that for transit import containers will be reduced to nine days from the current 11 days, according to a scheduled released by KPA.
A 20-foot equivalent container unit (TEU) for meant for the domestic market will attract a surcharge of $30 (Sh2, 505) per day for the initial seven days after the deadline and $45 (Sh3, 757.50) per day after 25 days.
Containers meant for the transit market will also attract a similar surcharge once they surpass the allocated 11-days free storage period. Imported motor vehicles on direct delivery will be allowed 18 hours to exit the port or face charges of up to $30 (Sh2, 505) per day should they exceed the allotted time. Besides efforts by KPA to clear over-stayed cargo from port to ease congestion.KRA also plans to destroy a total of 437 over-aged vehicles at the facility starting next month.
Source: Business Daily
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