Courier companies denounce proposed logistics regulation bill

Bill set to give more control to the government

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KARACHI: The bill passed by the National Assembly and titled as ‘Pakistan Courier and Logistics Regulatory Authority Act 2017’ is under the spotlight as courier and logistics companies say they were not, and should have been consulted before it was passed.The bill is now pending approval by the Senate to become an act.

In a joint letter to Deputy Chairman Senate, the companies termed the bill as arbitrary and discretionary in nature. They alleged that their feedback was not solicited prior to the introduction of the bill in the National Assembly.

Sources said the proposed act would regulate the functions of the courier and cargo sectors, help generate funds for the government and set tariffs for courier services in a transparent and fair manner. Currently, private couriers, cargo and logistics service providers are operating without any regulatory regime. They are free to fix their own charges and are not paying general sales taxes and other levies. Many incidents of under- and over-pricing have been recorded and there is no protection for customers, the source added.

The industry collectively pays heavy amounts of revenue in the form of various cess, levies and taxes to the federal, provincial and local governments.

They believed that if the Bill is enacted in its current form, it would have dire consequence for the private service providers.They said there is a need to revisit the provisions of the bill and take into account the due concerns of the industry.

The proposed bill is highly averse to service providers as the composition of the authority is very unbalanced, with the government being favoured by having nine members out of a total 11. The private sector will get only two members on the board of the authority.

Pakistan Post Office (PPO) enjoys a permanent position on the board of the authority. This means that the majority members can pass any rules and regulations under the Act without any regard to the input of the private sector.

Director Marketing and Public Affairs TCS, Naiyar M. Saifi claimed that services of private sector couriers are far attractive than the PPO. He said the bill is introduced to severely limit the business of the current service providers involved in courier and logistics services. A permanent place on the Regulatory Body called the “Authority” is given to the PPO which may result in serious conflict of interest as Pakistan Post is currently in the business of receiving, sending, dispatching and the delivering all letters, and the Bil,l by adding in new definitions, is bringing in all parcels, letters, packets or any other kind of communication within the purview of the Post Office of Pakistan, he explained.

TCS holds over 45 per cent market share. The courier company has around 16,000 clients in the corporate sector while over 40,000 people daily visit its centres all over the country, he claimed.

Chairman Central FPCCI Standing Committee on Freight Forwarding and Logistics Services, Jawed Khalili said the members are reviewing the bill regarding its negative and positive impacts.

The committee will hold a meeting on this issue with stakeholders next week to discuss the bill at length. In this regard, the committee would send its suggestions to the government regarding any amendment in the act before it becomes a bill. He said the committee would present its recommendations to the government.

Courier companies informed the Senate that there is no process prescribed in the act for selection or election of private members.

A term of three years is fixed for the private members as opposed to the government members who hold permanent positions. The provision can result in an arbitrary selection of private members leaving principle service providers, holding dominant markets, out of the authority which can result in drastic regulations for principle service providers.

The authority has given powers to suspend and revoke altogether the licenses issued to service providers on the transfer of shares by a shareholder in case of a company which in turn is in contravention to the provisions enacted under the Companies Act, 2017 and even goes against the fundamental rights such as Article 18, freedom of trade, business or profession as guaranteed under the Constitution of Pakistan, they said.

A permanent immunity is granted to PPO and its officers under the Post Office Act and no action can be taken by any aggrieved person against the Post Office and its officers unless involved in fraud, they added.