The Federation of Malaysian Manufacturers (FMM) has expressed its concern about the increasing Bill of Lading (BL) fee for exports and Delivery Order (DO) fee for imports collected by shipping lines or their agents.

“The current practice of shipping lines or their agents to charge shippers RM50.00 for each Bill of Lading and RM50.00 for each delivery order undermines the competitiveness of Malaysian manufacturers and shippers and this is totally unacceptable,“ said the Chairman of Federation of Malaysian Manufacturers (FMM) Logistics Committee, Manuel A P Gomez.

Presenting a paper at the Malaysian Maritime Institute seminar on “Transport and Logistics Channels: Working in Sync to Promote Competitive Trade” on 18 June 2001, Gomez said BL and DO fees should not be charged just to “help shipping agencies to recover their administrative and/or internal operational expenses”.

BLs and DOs were initially issued free-of-charge by shipping lines or their agents to shippers as part of the shipping process. 

However, since 1988/89 shipping lines and their agents started to impose fees for these documentary receipts despite shippers’ objections.

Since the initial imposition, BL and DO fees have increased by a hefty 400 per cent from RM10 in 1988 to RM50 in 1999.

He cited figures obtained from Customs which indicate that Malaysian exporters paid to shipping lines or their agents a total of RM8.2 million in 1998 for Bill of Lading fees while Malaysian importers were compelled to pay RM10.4 million for DO fees.  

All these payments were in addition to the ocean freight charges paid to shipping lines, he noted.

The fees were unilaterally imposed in an arbitrary manner, without any prior consultation with shippers.

Gomez also stressed that shipping lines and/or their agents wrongly classify BL and DO fees as being “land” side charges and therefore are not being reflected as part of the freight charges. 

“Regardless of whether an exporter is selling FOB or CIF, such fees are still imposed.  These actions force shippers to add such “fees” to their FOB prices thus making them less competitive in local, regional and global markets.  If this problem is not quickly rectified this could deter foreign direct investments by way of adding to the cost of doing business in Malaysia,” he said.

 “As such we strongly urge immediate and necessary actions taken to abolish the Bill of Lading and Delivery Order fees. Relevant authorities should amend and/or enact legislation to compel shipping lines, conferences and/or their agents to consult shippers prior to the introduction of new charges or to the rate increases of existing charges.

An immediate moratorium be imposed on any increases in or new imposition of fees,  charges,rates, etc., by shipping lines/agents, transportation and logistics service providers which directly impact on the cost of doing business in Malaysia said Gomez.