As the COVID-19 Pandemic continues to take
hold in India, the major cause of worry that air freight forwarders have
been facing—in the 21-day lockdown that India is going through—are
the conflicting directives from authorities and regulators.
One challenge is payment of handling charges
through IATA’s Cargo Account Settlement System (CASS) to international
carriers bringing or taking goods from India.
Sunil Arora, President of the Air Cargo
Agents Association of India (ACAAI), speaking to FlyingTypers pointed
out that more than 500 IATA-authorized forwarders would not be able to
pay the cargo handling charges to the carriers if they were not given
India In CASS Pandemic Throwdown
The payments were due on April 1, and IATA
has only given an extension of nine days until April 9. The extension
time of nine days, said Arora, was not enough with the lockdown.
He said that the forwarders were not in
a position to pay up the airlines according to the CASS calendar.
Need More Time
“We will start making the payment
as per each due fortnight after 21 days, once the lockdown is withdrawn,”
According to ACAAI, around USD$2billion
is sent through CASS every year.
Almost No One Paying
Almost all export/import units, along with
export promotion zones have not been functioning.
To add to the forwarders’ woes, clients
have delayed payments.
So Arora has sent a letter to IATA India
asking for more time.
“We request you to immediately advise
IATA CASS to give 21 days’ additional grace period from the due
date of all the fortnightly CASS payments from March 16, for all ACAAI
members, until the Covid-19 crisis is brought under control,” the
letter to IATA states.
Enlightened No Fault-Default Needed
Forwarders receive an ‘irregularity
notice’ if they do not pay in within the allotted time.
And if a forwarder receives three ‘irregularity
notices’, he is declared a defaulter with CASS and international
carriers often refuse to work with the forwarder again.
Speaking to FT, Arora said that
he was not looking for a waiver.
He emphasized that he was only seeking an
“extension of the date, considering that our members are facing
difficulty in getting payments from clients.”
In fact, ACAAI has taken the case to the
Prime Minister’s Office hoping that the intervention from the top
would help IATA make up its mind and give an extension.
IATA Stands Its Ground
For its part, IATA has said that banks were
not part of the lockdown and since the payments had to be done electronically,
the date would not be changed from April 9. IATA
pointed out that it would do “what we can to avoid agents being
penalized for failure to comply with the reporting and remittance obligations
under their Cargo Agency Agreement in view of the force majeure situation
in the country and around the world.”
Congestion & Social Distancing
As if that were not enough, the country’s
air cargo stakeholders have demanded 100 percent waiver of all demurrage
charges at all airports.
With the lockdown in progress and acute
shortage of labor, cargo, both import and export, is stuck inside the
Almost all airports have reported congestion
in the terminals with the Mumbai terminal suffering the most.
Air cargo stakeholders point to the Ministry
of Civil Aviation order of April 1, 2020, that allowed a waiver of 50
percent of demurrage charges levied by airports until April 15.
However, the order had conditions, confusing
forwarders and other stakeholders.