Freight Forwarder Roles in the Transaction

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1 Freight Forwarder Roles in the Transaction

2 Presenter Torsten (Tom) Helk Tom is BDP s Manager Hazardous Materials and Export Compliance, and has worked for BDP since Tom started his career in logistics in 1974 in Germany and came to the US in 1979, working in ever expanding roles with several Freight Forwarders. He is an active member of the Dangerous Goods Advisory Council in Washington, DC, and is a past Chairman of that organization. As well, Tom is a certified Dangerous Goods Safety Advisor under the European Regulations.

3 Todays world A freight forwarder is one of the important links in the global supply chain Freight forwarders over the past 10 years have built up core functionality in Freight Handling ( domestic and international) as well as Documentation expertise Many have developed technology tools ( website, trace and track et ) to assist in the process

4 Freight Forwarder Fundamental Roles The freight forwarder ensures that your goods receive the priority it requires; your documentation is appropriately filed and your goods reach its destination in the specified time. The increasing specialization on transportation of goods and decimations operations means that the exporter of products would prefer to leave these formalities to the "freight forwarder" in order to concentrate on his own business. An efficient "freight forwarder" can offer advice, on the special requirements of different countries as well as to offer a number (sea, air, rail etc.) of quotations for a particular consignment being sent from point A to B. The "freight forwarder" role is often underestimated as one of the most important elements in shipping. The "freight forwarder" is there to ensure that your goods receive the priority it requires; that your documentation is appropriately filed and most importantly, your goods reach its destination in order and in the specified time.

5 Freight Forwarder Fundamental Roles The next most important and effective function of the "forwarder" is to be an adviser and agent for the shipper, and that, is the "forwarder's" prime consideration. The transportation of goods from one place to another over short or long distances, is a fundamental activity in materials handling with many complexities in international cross border transportation i.e. large number of documents are required to document the movement goods. The basic activities of a "freight forwarder" include booking cargo space on ship, airplane, train, or any other form of goods/cargo transportation, route planning, various documentation, export packing, insurance, warehouse, collection and delivery consignment. And to provide service which involves establishing various inland depots and clearing offices so that customs clearance at the port of entry is done by the "forwarder "as well as delivery to consignee's doorstep, without actually involving the consignee.

6 Freight Forwarder Roles in different countries USA In the U.S., a freight forwarder involved with international ocean shipping is licensed by the Federal Maritime Commission as an Ocean Transportation Intermediary. Similarly, freight forwarders that handle air freight will frequently be accredited with the International Air Transport Association (IATA) as a cargo agent. EU In the EU, depending on the country, freight forwarders have to be licensed. Each EU country has it s own Freight Forwarder s Association where the freight forwarder can register as a member. For Example, in the UK, freight forwarders can be members of the British International Freight Association (BIFA). Airfreight freight forwarders are accredited with IATA as a cargo agent. The larger freight forwarders offer management of both imports and exports and have in house customs brokerage.

7 Definition A freight forwarder is an agent who handles International shipments for a fee. Freight forwarders play a very important role for exporters. International documentation and packaging Carrier and routing information Marine insurance rates and coverage Warehouse and distribution services Hazardous materials shipping compliance information For shipments leaving your country, the freight Forwarder is the expeditor, interfacing with all the necessary government agencies and companies involved in getting the cargo to its foreign destination.

8 Definition A freight forwarder is an agent who handles International shipments for a fee. Freight forwarders play a very important role for importers. Customs documentation and clearance process Carrier and routing information Warehouse and distribution services Hazardous materials shipping compliance information For shipments entering your country, the freight Forwarder is the expeditor, interfacing with all the necessary government agencies and companies involved in getting the cargo to its destination

9 Many Different Sizes and Styles There are many Freight Forwarders, with different levels of services and styles to exporters and importers. Many Freight Forwarders are multi-national while many are local / regional service stations that address the local needs. The services that a Freight Forwarder offers, is different today then what was required just 10 years ago

10 Services A Freight Forwarder is placed into the transaction to manage the physical movements of goods To file the necessary paperwork / electronic filing to achieve export or import clearance Offer value-added services to both exporters and importers to assist them in the physical movement of goods Keep in touch with industry trends Offering solutions for freight management Better understanding of freight options with proper costing structure

11 Ocean Freight Forwarder An ocean freight forwarder is an individual or company that dispatches shipments via common carriers and books or otherwise arranges space for those shipments on behalf of shippers. Ocean freight forwarders also prepare and process the documentation and perform related activities pertaining to those shipments

12 The Freight Forwarder can also Prepare all required Import Entry documents and arrange for the clearance of goods Arrange for the imported goods to be delivered to it s destination, including preparing in-bond papers or border crossing documentation if required.

13 NVOCC Non-vessel Ocean Common Carrier An NVOCC is a common carrier that holds itself out to the public to provide ocean transportation, Issues its own house bills of lading or equivalent document, but does not operate the vessels by which ocean transportation is provided, Is a shipper in relation to the involved ocean common carrier.

14 Denied Parties List A Freight Forwarder is responsible for having and consulting the Denied Persons List in order to ensure that no party to the transaction has been denied export privileges Which in BDP s case this step is taken care of through the automatic checking program in the BDP export System.

15 In the Census Regulations A Freight Forwarder is responsible, along with our customers, for the correctness of each entry that we make on the (Import) Export Information or other (import) export control documents; Although good faith reliance on information obtained from our customers can help to protect BDP, However careless use of unsupported data that is sent on the (Import) Export Information filing entries can get a Freight Forwarder into trouble with Customs and other Government agencies.

16 Responsibilities of the Export Forwarder Transportation and delivery of the merchandise to the Carrier, facilitates the export of Merchandise. Accurately prepares and submits the Export clearance record based on information received. Obtains a copy of the Export clearance record. Maintain documentation to support information required on the Export clearance record

17 Responsibilities of the Import Forwarder Pick up from port, transportation and delivery of the merchandise to the final destination (determined by the customer) Accurately prepares and submits the Import clearance record based on information received. Obtains a copy of the Import clearance record. Maintain documentation to support information required on the Import clearance record.

18 Different kinds of representation Direct representation The customs dispatching agent handles the transmission in the name and on behalf of the principal (= importer or exporter) the customer s name will be mentioned on the declaration so BDP declares in the name of and on behalf of the customer The principal will be responsible for the declaration The customs agent will not be liable for any customs debt.

19 Different kinds of presentation Indirect representation The customs dispatching agent (BDP) files the declaration in his own name, but payable by the principal The customs dispatching agent is the declarant and liable for the contents of the declaration The agent (BDP) and the principal (importer or exporter) will be joint debtor regarding any customs debt (import or export duties)resulting from the declaration

20 The Power of Attorney (POA) A representative (BDP) must state that he is acting on behalf of the person represented (importer/exporter), and this representative (BDP) must exhibit the license to the customs administration Definition Format is a written authorization to represent or act on another's behalf. No formal requirements but following information is required: To whom the power of attorney was provided Indicate that the person who provided the POA is an existing person Indicate if the person who provided the POA is established in the Community Who the POA signs on behalf of the other person The person who sings on behalf of the other person needs to have the power to sign

21 Record Keeping Requirements All records must be retained in the form they were originally received for a certain period of time in accordance to the country s requirements.

22 Penalties There are penalties for non compliance with the international/local regulations, i.e. non-filing or late filing of Export clearance information, etc. These penalties can differ from one EU country to another as this is a country specific prerogative.

23 At the end of the working day you should expect? A Freight Forwarder is to be an extension of your transportation process Bring Value to your process, in the form of new ideas, solutions Understand and keep current with regulations as it pertains to them as well as to the industry Set up good metrics for all parties to follow, ensure that each key step is measured and a high performance level is achieved

24 Contact information Torsten (Tom) Helk Phone: Mobile: Walnut Street, Philadelphia, Pa To download today s presentation please make note of the following link Next session topic will be What is classification September 17, 2013 Caroline Gubbi

25 Freight Forwarder Roles in the Transaction

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