05 July 2006

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Business Today

GRTU accuses government of handing Freeport an Lm800,000 ‘present’

James Debono

Costs at the Freeport are only expected to decrease by five per cent despite the elimination of an artificial charge previously imposed by the now defunct Cargo Handling Company Ltd.
The charges formerly imposed by the GWU’s company will now end up in the Malta Freeport operators’ coffers.
The GWU-owned company was only responsible for cargo handling operations at the Grand Harbour but used to exact a charge at the Freeport despite not doing any work there.
Valletta Gateway Terminals, the new company which has taken over from the GWU-owned Cargo Handling Ltd at the Valletta harbour, will not be imposing any charges at the Freeport.
Yet the Freeport will still charge importers and exporters the same fees as before, except for a five per cent reduction.
According to Malta Maritime Authority Chairman Marc Bonello the Freeport operators will only be paid for what is due to them.
But according to GRTU Director General Vince Farrugia the Freeport operators will be making an extra Lm800,000 a year.
The GRTU Director General contended that nobody had ever told the business community that they will have to shoulder “an Lm 800,000 present to the Freeport operators.”
“Why was all this kept hushed?” asked Farrugia yesterday as confusion over port charges continued. Contacted by Business Today a livid Vince Farrugia blamed the situation in the port squarely on Marc Bonello and asked him to resign.
Farrugia reiterated claims that importers and exporters are being double charged citing bills, which still include charges imposed by shipping agents.
But Malta Maritime Authority Chairman Marc Bonello denied the double charging claim.
“The total amount charged on containers entering or leaving Malta cannot exceed the maximum tariff established by the MMA,” Bonello told Business Today.
Shipping agents used to be responsible for charging costs related to moving containers from ship to shore.
The Free in Out Stowed (FIOS) charges included costs related to the Port Worker Scheme as well as costs related to the shore foreman, tally clerks, overtime allocation and customs.
After 1 July the new operators, Valletta Gateway Terminals have taken over this responsibility.

Shipping agents’ bills
Bonello yesterday acknowledged that until 1 August, shipping agents will continue issuing bills but insisted that the new operator will not be charging for the same services.
“This is merely a transitory arrangement,” Bonello told Business Today.
But Vince Farrugia was far from satisfied by Bonello’s explanations insisting that the two regulatory authorities in the Freeport and the Valletta port are more interested in defending the monopolies enjoyed by the two foreign operators: Valletta Gateway Terminals and CMA-CGM at the Freeport instead of standing up for exporters, importers and haulers.
“We have nothing against foreign operators but we expect the regulators to defend the business community from monopolistic practices,” Farrugia said.
Asked how the situation at the Freeport could be unblocked, Farrugia said that the GRTU was willing to stop all actions if an office in Marsa is kept open so that cargo haulers would be able to make their payments without having to visit the Freeport five times a day.
“This is only justified when one considers that the Freeport will be making extra thousands of liri by charging importers and exporters for charges previously imposed by Cargo Handling Ltd,” Farrugia said.
Following this gesture, Farrugia said, the GRTU will be willing to talk about the wider aspects of port reform.

Security pass
The GRTU’s demand could be an indication that the union intends making a show of force before discussions on wider port reform commence.
Marc Bonello pointed out that cargo haulers are responsible for 20 per cent of port costs.
At present only haulers equipped with security passes can enter a specific area in the port to load merchandise on their trucks.
According to Bonello the market is effectively restricted to 113 licence holders.
Yet the MMA chairman would not go as far as proposing the complete liberalisation of the sector.
The GRTU is insisting that the European Union during pre- accession negotiations had accepted the security pass system.
“We do not intend to break with any previous commitment negotiated with the European Union which limits the number of security passes, but we will make sure that the prices charged by haulers are reduced and regulated,” Bonello said yesterday.
According to Bonello this can either be done by imposing maximum charges, which can be levied by haulers, or by enacting the necessary checks and balances to regulate these prices.


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