A Transport Operator member of the Club was asked by a new client to arrange customs clearance of goods. The client asked the member to establish the correct rate of import duty to be paid on the merchandise. The member consulted his copy of the customs tariff and told the client that the rate would be 10%, with a further 15% in sales tax.
When the consignments arrived, the member declared them under that tariff heading and duty and tax were calculated and paid accordingly.
Eighteen months after the first consignments had arrived, a customs officer inspected one of the consignments and decided that they had been misdeclared: the duty rate should have been 12.5%. The customs authority agreed with the officer, and submitted a demand for the additional 2.5% duty and a corresponding amount of extra sales tax, on all previous consignments. The importer refused to pay the additional amount, saying that he had relied on the professionalism of the "customs expert" in the member's office to advise him correctly.
Lawyers advised the Club that the customs authorities were within their rights to make a claim for all the previous consignments and that the member had very little defence. It would also be difficult to pursue the client for the extra money, on precisely the grounds that the client had set out.
The importance and impact of careful drafting of contracts is exemplified in this UK Supreme Court decision. While the ruling brings clarity to English law, it represents congruence with other jurisdictions. It is most prudent to be deliberate in documenting law and jurisdiction choices in contracts.
This briefing considers the potential impact on ocean freight and supply chain management activities of freight forwarders and logistics operators should steps to curtail the spread of coronavirus continue to disrupt the movement of goods. While key concerns will distil to delays and potentially cargo deterioration, the following provides some guidance on the potential risks to freight operators and how to mitigate them.
This session explores the primary changes under the new trading conditions and will be of interest to stakeholders who trade under RHA trading conditions and businesses who contract with those stakeholders.
