LFFA urge MITI, MoF to enhance operating conditions in Labuan

Freight forwarders operating in Labuan Liberty Terminal have called on the International Trade and Industry Ministry and Ministry of Finance (MoF) to change certain operating conditions in order to grow and enhance the import and export activities at the port.

The Labuan Freight Forwarders Association (LFFA) members also urged the ministries to allow the port to fully utilise its duty free status and make it active, not only to support the oil and gas industries but also as a transit port for vessels to Asian countries.

“Relevant government agencies should also allow local agency officers to make decisions to grant necessary approvals without having to get all approvals from Putrajaya,” LFFA president Prunella Phoong Mui Lin told the New Straits Times.

Another area of concern is the approvals for import permits or licence for alcohol, beers and tobacco/cigarettes which have to go through the Royal Customs Department headquarters in Putrajaya.

“Applications submitted months ago are still pending. The imported consignments that are now nearing their expiry dates are still sitting at the port storage area accumulating port charges and container demurrage charges,” she said.

Prunella questioned how Labuan Liberty port can become an efficient port when policies and procedures for customs clearance were made without local officers in Labuan knowing about it.

These, among many other procedural issues, are the pressing matters that need the attention of relevant government agencies.

“Furthermore, we also urge the government to reconsider the implementation of port dues applicable for laid up rigs and vessels due to the downturn of the oil and gas activities.

“This will allow the owners to use Labuan Liberty as a venue to carry out maintenance activities or upgrading of rigs or vessels when the oil and gas activities pick up in the next year or so,” she said.

Port fees, or harbour dues, are charges levied against a shipowner or ship operator by a port authority for the use of a port.

Prunella said such maintenance or upgrading activities will keep the logistics and shipping afloat and bring life to the island where import and export activities as well as other businesses such as hotels, restaurants, vessel catering and husbandry will continue to flourish.

Prunella said relevant government agencies must cut the red tapes on having importers meeting the “standard requirements”, particularly for imports heading for Labuan or transhipments that require import permits and approvals.

“These so-called standard requirements procedures are paid to government agencies at a high cost and takes a lengthy time to complete the process for approvals,” Prunella, who is also the Federation of Malaysian Freight Forwarders (FMFF) secretary general, said.

Labuan Liberty has always been used primarily as a logistic hub for the oil and gas industries.

“Another positive move is for the government to make Labuan Liberty a 24-hour port operation to discharge and load consignment within the port limits.

“The Customs Department had in principal agreed that such operations can be granted with certain conditions to fulfill,” she said.

On how the Movement Control Order (MCO) impacted freight forwarders in Labuan Liberty, Prunella said the MCO had not affected the imports or exports via sea freight.

“We are expecting shipping lines, non-vessel operating common carrier (NOVCC) operators and port operators to increase their rates due to the drop of exports or imports to cover their operational cost.

“However, the number of ship calls has been the same prior to the MCO as today. We do hope that passenger and freighter flights return to normal, as we now only have two to three flights per week that can uplift cargo.

“Even if we have the cargo load, we do not have the aircraft to take the load out. With the MCO, even foreign charters aircraft face issues for their crew who are on long hauls as they will be quarantined on arrival. As such, we hope the call for quarantine for foreign aircraft crew be considered during the restricted movement period,” Prunella said.

In April this year, Straits Inter Logistics Bhd’s 51 per cent-owned Megah Port Management Sdn Bhd (MPM) took over the management of Labuan Liberty Terminal.

Prunella said the MPM management had started clearing the port areas to give more space and provide operations in a clear and clean manner.

The port operator has also invested in new equipment and engaged local contractors to provide additional equipment to turn around the operations.

“If this continues, MPM will be able upgrade to make Labuan Liberty Port an efficient port,” she said.
Source: Straits Times

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