Associations see red over new demerit system

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Chung (seated third left) and Lee (seated third right) are seen with other association members at the press conference.

Chung (seated third left) and Lee (seated third right) are seen with other association members at the press conference.

KUCHING: The Sarawak Forwarding Agencies Association (SFAA) and Sarawak Shipping Association (SSA) are seeing red over the Customs Department’s new demerit system, which began nationwide this month.

According to SFAA, the system will most likely see the licenses of hundreds of the state’s forwarding and shipping agents suspended in the next few months, causing a chain of events that could ultimately cripple trade in Sarawak.

“With the way the offences and demerit points have been structured, there is a very high possibility that many agents would incur the maximum penalty points quickly,” SFAA chairman Joseph Chung told a press conference yesterday.

He claimed the Customs Department could interpret many offences under the Act as there are no proper clarifications or guidelines.

“For example, forwarding agents have been compounded between RM2,000 and RM5,000 for spelling mistakes in the manifest details, amendment to the manifest, slight changes in the consignee’s name (although address is the same), amendment in measurement weight of metric tonnes and shipping agents’ code,” he said.

Although invoices and packing lists are prepared by overseas suppliers to their importers, Chung said declaring the list based on the information stated could also see the agents issued compounds of up to RM5,000 for any error.

“If this (mistake) falls under the offence under Section 133, the agents would incur the maximum 20 demerit points immediately,” he said.

He pointed out that many such offences arise from errors in the declared documents to Customs, which were not the fault of the forwarding and shipping agents.

Chung said agents would be given demerits if they were found flouting rules such as making incorrect declarations or falsifying documents under Section 133 of the Customs Act 1967.

Those breaching Section 133 would see forwarding and shipping agents given 20 demerits — the maximum number for a company to be issued a warning.

Receiving another 20 demerit points would lead to a license suspension for between six and 12 months, while three suspensions within three years would see the cancellation of licenses.

Meanwhile, Chung also complained that no dialogues were held between the stakeholders and the Customs Department regarding the implementation of the new demerit system.

“We have also written an official letter to the Custom’s director-general to no avail. A joint press conference was also held in Kuala Lumpur on April 1 led by the Federation of Malaysian Freight Forwarders together with other stakeholders voicing out their concerns on this issue,” he added.

He said SFAA would write an official letter to Chief Minister Datuk Patinggi Tan Sri Adenan Satem to seek assistance for an amicable solution.

“What will be the impact on the economy when many forwarding agents run the risk of suspension with logistics services disrupted and affecting the business of our importers and traders?” he asked.

SSA secretary Lee Kim Kwang said the demerit system is not suitable for Sarawak due to the state’s geography and economy.

He said SSA did not oppose the demerit system but wanted time for stakeholders to adjust and absorb it.

Lee called on the state Customs director to consider postponing the new demerit system in Sarawak until all details are fined tuned to suit operations here.