The operation of Bangladesh chapter of the China-based global shipping giant Cosco Shipping has faced a new hurdle following a ruling of the Appellate Division.
The ruling, as obtained by the Financial Express (FE), has put a stay order on its operation in the country until May 3, 2020.
As a result, both the exporters and the importers, whose goods are in the pipeline with the company's ships, may face troubles, according to the shipping circle.
The Chattogram Customs House (CCH) officials said on Sunday they will follow the instruction of the Appellate Division.
"We are bound to comply with the court order, obtained on Sunday morning," Kazi Zia Uddin, an additional commissioner at the CCH, told the FE.
He said the fate of goods, transported by the Chinese shipper, has now become uncertain.
"Both the exporters and the importers may suffer, as all concerned will comply with the order."
However, the CCH will observe the situation for the time being, he added.
The Bangladesh Shipping Agents' Association (BSAA), a group of around 500 shippers, is the petitioner of the case, while the local agent of the Cosco Shipping Continental Traders is the respondent.
A director of BSAA said they filed the case considering the interest of their members.
He said the Continental Traders and the Cosco Shipping have tied up by violating some rules regarding the shipping business norms.
Earlier, the Cosco Shipping had business with the Cosco BD, a joint venture company of Bangladeshi and Chinese sponsors.
Local agents usually handle goods and ships in the country on behalf of their parent company. For the service, they get a certain commission as per the Bangladesh Bank rule.
For such type of local company formation, the local sponsors usually have 51 per cent stake, while the principals have 49 per cent.
The Continental Traders have been doing business with the Cosco Shipping since 2016.
The Cosco Shipping has seven vessel services plying the Singapore-Chattogram route. It transports around 11,000 twenty-foot equivalent units (TEUs) of Bangladeshi cargoes on both ways each month. This is around 6.0 per cent of the total containers, handled by the Chattogram Port.
© 2024 - All Rights with The Financial Express
