Chattogram customs cancels COSCO agent licence as per court order

The Chattogram Custom House has cancelled the licence of M/S Continental Traders, the local shipping agent of China's COSCO Container Lines Company Limited which appointed two agents at the same time violating custom guidelines.

On September 25, Kazi Muhammad Ziauddin, additional commissioner and president (licence authority) of the Chattogram Custom House, cancelled the licence. 

In compliance with a High Court order, he also asked M/S Continental Traders to refrain from handling COSCO ship and container.

COSCO (Bangladesh) Shipping Lines Limited (COSCOBD) was the local shipping agent of COSCO.

On August 16, 2016, the custom issued a permission letter in favour of M/S Continental Traders in response to the latter's application for COSCO's Bangladesh agentship.

However, COSCOBD filed complaints against COSCO and M/S Continental Traders, alleging that COSCO signed the agreement with M/S Continental Traders without completing the Settlement of Accounts with it.

The custom guidelines issued on August 13, 2014, says: "The foreign principals cannot sign agency agreement with more than one legal agent at a time, and cannot appoint a new agent without executing a Settlement of Accounts with the existing agent."

Experts said if the settlement of the dispute was delayed, it would take tolls on importers.

"COSCO vessels have arrived in Bangladesh. If the problem is not resolved, the vessels will be stuck here and the importers will suffer as they will not be able to release their goods," explained Ahsanul Haque Chowdhury, president of Bangladesh Shipping Agents Association. 

"We request the authorities to either solve the problem or issue directives on how the COSCO products that have already arrived will be released," he said.  

Seaborne trades handle about three million TEUS (twenty-foot equivalent units) containers annually while M/S Continental Traders handle around 1.44 lakh TEU containers, said M/S Continental Traders sources. 

Ziauddin told The Business Standard: "I think the importers need not be worried as we have told M/S Continental Traders that it can handle the COSCO vessels that arrived before the cancellation letter was issued on September 25." 

"The solution to the long-standing dispute lies with COSCOBD and M/S Continental Traders. They should solve the issue for the sake of business and the importers," he said.

A COSCO vessel arrived at Kutubdia point of outer anchorage on September 29, and no directive on releasing goods from it has been issued yet.     

How the dispute began

When COSCOBD lodged complaints against COSCO and M/S Continental Traders in 2016, the custom house cancelled the permission of M/S Continental Traders. 

That year, M/S Continental Traders filed a writ petition with the High Court challenging cancellation of its licence and the custom house guidelines on appointment of local agent. The court gave an interim order in favour of M/S Continental Traders, saying that cancellation of its licence was illegal. 

After the court order, the custom again issued M/S Continental Traders licence on August 16, 2016. 

COSCOBD challenged the interim order and filed a writ petition that year. The High Court then cancelled the interim order on June 5, 2017.

After the cancellation of the interim order, M/S Continental Traders filed a civil petition for leave to appeal.

However, the Appellate Division on July 7 this year dismissed the civil petition and upheld the High Court judgment.