KARACHI, Sept 4: The government is considering regulating freight forwarders business by adopting internationally recognised norms and practices.

Presently there are many complaints from trade with regard to unlawful practices of freight forwarders, who allegedly change the title of export consignments by issuing house bill of lading to replace the master B/L.

As a result of this exporters lose legal right over their export consignments, which encourage foreign buyers to dictate their terms by raising unreasonable objections on quality, quantity and delivery time.

Ultimately, this resulted in huge financial loss to exporters and in some cases they also land behind the bars after issuing cheques to local suppliers in the hope of payment forthcoming from foreign buyers which did not come.

Decision to regulate freight forwarders working and also fix their service charges was taken in the fourth meeting of National Trade Corridor (NTC) chaired by Federal Board of Revenue (FBR) chairman Abdullah Yousuf recently in Islamabad.

The FRB chief stressed the need for having a clear set of rules and regulations for the working of freight forwarders so that “unscrupulous elements in the freight forwarding community do not exploit the trade.”

Abdullah Yousuf directed ministry of commerce and Pakistan International Freight Forwarders Association (PIFFA) to expedite the finalisation of rules by taking a holistic view of all issues by creating a consensus among all stakeholders.

The FRB chairman also directed the ministry of ports and shipping to resolve the problems faced by the traders and exporters. He said that the regulatory authorities should redress the problems faced by exporters with a view to reduce cost of doing business.

The representatives of Karachi Chamber of Commerce and Industry and Pakistan Hosiery Manufacturers Association pointed out that the freight forwarders were exploiting the trade by collecting unfair charges in clear violations of the State Bank’s regulations.

They further said that the freight forwarders became exporters and consignees by changing name of consigner. They also dwelt on the issues related to title of goods in the house bill of lading explaining that litigations of serious nature were faced due to house B/L substituted with carrier B/L as it changed the title of exported goods.

The representatives of KCCI and PHMA said that the change of title of goods by the freight forwarders adversely affected the position of exporter regarding payment from buyer. By this practice the freight forwarders in collaboration with shipping lines deprive the genuine exporter of the title while extending extra facility to the buyers by delivering export documents without bank clearance.

This helps the buyer derive maximum benefit in the shape of heavy discount, delay in payment and at times even defaulting in payment causing immense mental anguish and financial loss to the exporters in Pakistan.