The Directorate General of Shipping has directed ports and terminal operators to immediately pass on concessions to exporters impacted by stranded Gulf-bound cargo, eliminating reimbursement-based processes that delay relief.
In a circular dated April 8, the regulator noted that concessions such as detention charges, ground rent, and reefer plug-in costs are not being uniformly transferred to exporters.
“It has been observed that concessions granted by port authorities particularly relating to detention charges, ground rent, reefer plug-in (connected load), and similar terminal charges are not being uniformly passed on to the exporters,” the circular stated.
Direct Transfer of Benefits Mandated
DG Shipping highlighted that terminal operators often charge Non-Vessel Operating Common Carriers (NVOCCs) first and later reimburse them, creating delays in extending benefits to exporters.
“This circuitous process delays the concession reaching the exporters,” the regulator noted.
To address this, DG Shipping has mandated that all concessions approved by port authorities must be passed on directly and transparently.
“All concessions approved by Port Authorities shall be directly and transparently passed on to the concerned stakeholders, including freight forwarders and NVOCCs who in turn shall reflect the same to the exporters,” it said, adding that reimbursement or post-facto claim mechanisms “are to be discontinued with immediate effect.”
Port authorities have also been tasked with monitoring compliance at terminals to ensure exporters receive benefits without delay.
Mandatory Documentation of Additional Charges
The regulator flagged instances where shipping lines imposed additional charges for cargo diversion or discharge at alternate ports—including Back-to-Town (BTT) consignments—without proper documentation.
DG Shipping has now directed that all such charges must be formally recorded.
“All additional charges imposed by shipping lines must be formally documented, time and date stamped, and clearly quantified in monetary terms,” it said.
The move is aimed at enabling exporters to claim support under the Rs 497 crore Resilience & Logistics Intervention for Export Facilitation (RELIEF) scheme.
“Shipping lines are specifically instructed to maintain full transparency and auditability in such cases,” the circular added.
War-Risk Premium Under Review
DG Shipping also raised concerns over revisions in the war-risk premium (WRP) levied on cargo, noting possible misalignment with earlier directives.
“The matter is being taken up with insurance providers, including P&I Clubs and relevant stakeholders, in coordination with GIC Re,” it said.
Shipping lines have been instructed to proportionately reflect any changes in WRP in freight charges.
“Any deviation or non-alignment between actual risk premiums and freight components shall be subject to review and action,” the regulator warned.
Legal Backing for Transparency
The circular reiterated that Section 317 of the Merchant Shipping Act, 2025 empowers the government to ensure transparency in charges levied by service providers. It authorises authorities to require that all charges—fixed or conditional—be clearly specified in shipping documents such as the Bill of Lading.
