(Published in Part – III Section 4 of the Gazette of India, Extraordinary)

TARIff Authority for Major Ports

Notification

No.TAMP/2/97-MBPT             -             In exercise of the powers conferred by Section 48 and 50 of the Major Port Trusts Act, 1963 (38 of 1963), the Tariff Authority for Major Ports hereby approves the proposal of the Mumbai Port Trust to revise the schedule of Anchorage Fees, as in the Order appended hereto.  

SCHEDULE

Case No.TAMP/2/97-MBPT

                                                    The Mumbai Port Trust (MBPT)   ---          Applicant 

O R D E R

 (Passed on this 12th day of May 2000 )

                        This Authority considered a proposal of the Mumbai Port Trust (MBPT) for revision of composite towage and pilotage charges and an Order was passed on 27 October 98.  While approving a 10% increase in vessel related charges, we did not accept to the proposal of the MBPT to increase the levy of Anchorage charge.  The decisions of the Authority contained in the said Order are summarised below:

(i).         The proposal for a 10% increase is approved. 

(ii).        The proposal for rounding off fractions is not approved. 

(iii).       The proposed increase in the levy of Anchorage charge is found to be too high. 

            Likewise, the proposed reduction in the ‘free days’ at the Anchorage is found to be too drastic.   Since the reduction proposed is ad hoc and not based on any rationale, a reduction from 10 to 5 [and, not 3] will appear to be adequate, especially in the backdrop of the increase proposed in the charge. 

            While the objective of reducing congestion at the Anchorage is laudable, it will be preferable to distinguish between better-located Anchorages and other Anchorages and levy differential charges accordingly.  For example, the port can consider prescribing a higher rate and a shorter ‘free period’ for Anchorages which are closer to the docks and on either side of the main harbour channel; and, a lower rate with a longer ‘free period’ for other Anchorages. 

            The MBPT is required to reformulate their proposal accordingly. 

            In the meanwhile, to ensure that the port does not lose legitimate revenue earnings, a revised Anchorage charge at half the rate proposed is approved as an interim arrangement.  In other words, it will now be 10 paise or one U.S. cent per GRT per day from the 6th day to the 30th day and at double the rate per GRT per day thereafter. 

2.                      Accordingly, the MBPT has sent a revised proposal for review of Anchorage fees.   In the revised proposal, the Anchorages have been grouped with reference to their depth and utility.  Group (a) covers deep Anchorages used extensively for cargo work; Group (b) were the slightly shallow Anchorages generally used for repairs and for cargo work by smaller vessels; and, Group (c) were the shallow Anchorages used by smaller vessels and self propelled barges.  The proposal was approved by the Board of Trustees for the Port of Mumbai in its meeting held on 27 July 99.  

3.                      In accordance with the procedure prescribed,  the proposal was circulated to various port users.  Comments received from them are summarised below:- 

The Shipping Corporation of India (SCI) 

(i).         There has been a sea change in the conditions at Mumbai Port and its Anchorage area.  In fact, the situation in 1999 was that the Anchorage area of the port was virtually empty due to reduced level of traffic at the port.  Even during the monsoon period there is no congestion in the port.  It is unlikely that Mumbai port will see a surge in business during the year 2000 because of which the Anchorage berths will be congested. 

(ii).        The revision of Anchorage fees by 100% has been allowed by the TAMP on 30.11.98.  The free days have been reduced from 10 days to 5 days (50% reduction) 

(iii).       If the TAMP agrees to the revised proposal of MBPT, it will mean a 200% increase of rates in a span to two years. 

(iv).       It is suggested that for Anchorages under Sr. No. A 1(a) and 1(b), the charges be fixed for 4th day upto 30th day at 7.5 paise per GRT and 0.75 US Cents per GRT per day or part thereof respectively.   For the 30th day and beyond, the charges may be fixed at 15 paise per GRT and 1.5 US Cents per GRT per day or part thereof respectively. 

(v).        Rates must remain unchanged for a period of not less than 2 years from the day of notification of the TAMP order. 

The Indian National Shipowners’ Association ( INSA) 

(i).         Note under ‘A’ where reference to Lash Barge needs clarifications as it may get misused.  Lash Barge could be operating under its name in conjunction with Lash mother ship when it is conveying import / export. Reference to “Lash Barge” under ‘A’ concerns to such barges in name only but are now being utilised as Dumb Barges.  Mother ships have sold the Lash Barge to local operators who now use them mainly as Dumb Barges.  Regular Lash Barges operation as such may have to be considered without concession and be treated on par with ships to avoid it gaining undue double advantage as competitors.

(ii).        Note under ‘C’ is harsh.   They too can be charged as per item ‘B’ to meet the ends of parties. 

The Container Shipping Lines Association (CSLA) 

            The Container Shipping Lines Association has no comments to offer on this proposal. 

4.                      Comments received from the SCI and the INSA were sent to the MBPT by way of feedback information.  Further comments of the MBPT in this regard are summarised below: 

(i).         The SCI’s contention that Anchorage points are under utilised at Mumbai, etc., is not acceptable.  From April 1999 to November 1999, the Port has handled a total number of 2,655 vessels, out of which 218 have had cargo operations in stream.  Even during monsoon period, vessels have done lighterage operations. 

(ii).        The revision in Anchorage fees approved by TAMP in 1998 was not 100% as contended by SCI.  From a fixed rate per day it was made on the basis of GRT.  The increase becomes 100% only in respect of larger vessels above 24,000 GRT.  In the proposed rates these charges work out to even less than the existing rates in respect of certain Anchorages.  SCI’s contention that the proposed rates approved will lead to increase by 200% within two years is not correct. 

(iii).       The charges have been prescribed after analysing the commercial utility of the Anchorage points.   These charges are recoverable after lapse of the free period allowed for the vessel’s stay, which is sufficient to complete the formalities for voyage or berthing.  In fact, idling vessels are to be charged higher according to the commercial utility of Anchorage points occupied by them. 

(iv).       In the near future, bigger ships needing deeper draft may visit the Mumbai harbour.   Since the vessels cannot be berthed inside the docks, they will have to discharge the cargo in midstream.   With a view to obviate diversion of such vessels and to encourage discharge of cargo in midstream, the rates have been prescribed on GRT basis after allowing a certain free period. 

(v).        Since charges are recoverable on GRT basis, smaller the size of a barge lesser will be the amount recoverable from it; and, thus, there is no undue advantage to the lash barges as stated by the INSA.  All due consideration while prescribing rates for dumb barges and lash barges has been given by the MBPT. 

(vi).       The note under (C) has been incorporated with a view to discourage idling of barges and boats which are engaged in lighterage operations for conveyance of cargo to ports other than Mumbai.  Since charges prescribed herein are not recovered while the barges are engaged in cargo operation, INSA’s suggestion to bring this levy of charge under clause (B) will not be in order. 

6.                      A joint hearing in this case was held in Mumbai on 6 March 2000.  During the joint hearing, the following submissions were made: 

Mumbai Port Trust 

(i).         The proposal of the Port is in terms of TAMP’s Order. 

(ii).       We want to decongest the Anchorage. 

(iii).       There is no confusion about LASH barge – what becomes a dumb barge will not be treated as a LASH Barge. 

(iv).       There is no 200% increase.  Only 24,000 GRT and above will pay more; not others. 

(v).        We have spent a lot of money on dredging.  The lines must now have a judicious berthing approach. 

(vi).       We  do  not want our Anchorage to be cluttered with sub standard vessels.  Therefore, higher rates are proposed. 

Shipping Corporation of India  

(i).         Anchorage is not congested at all. 

(ii).        Reduction in Free days and increase in rates put double burden on the lines. 

(iii).       We have no objection if there is a differential for transhipment barges and barges coming into MBPT.  Note C is not clear.  Let it be unambiguously stated. 

(iv).       LASH barge even after becoming a dumb barge will exploit the provisions in Note ‘A’ (MBPT clarifies that it will go strictly by the Certification) 

(v).        LASH Barges shall not get any concession even for fleeting.   We like TAMP to develop a uniform practice. 

Indian National Shipowners Association  

            We totally endorse the views of the SCI. 

The Container Shipping Lines Association  

            The Port must reduce the costs instead of increasing the Tariff.

Mumbai and Nhava-Sheva Ship-Intermodal Agents’ Association

(i).         We agree with the CSLA.  Nothing is being done to reduce the costs.

(ii).        There is no need for a differential rate at all.  It will cause billing problems.  There is no congestion.  MBPT should have one rate.

(iii).       Ships cannot afford to idle at Anchorage.  There is no scope for congestion.

(iv).       The line will always go to cheaper Anchorage irrespective of grouping. (But as clarified by the MBPT, the cheaper sites cannot operate during the monsoon period).

(v).        MBPT has no traffic.  If ships want to come to Anchorage, they must be encouraged.

7.                      With reference to the totality of information collected during the processing of this case, and on the basis of a collective application of mind, the following position is seen to emerge:

(i).         The proposal has been received as per the direction given by this Authority in its earlier Order dated 27 October 98.

(ii).        The various locations at the Anchorage have been graded with reference to the draft factor as also the location factor (i.e., proximity to the docks and on either side of the main harbour channel).  The MBPT has, incidentally, recognised the need for such rationalisation in the context of the emerging traffic of big vessels which may not be able to go into the docks.

(iii).       Referring to the declining traffic at the MBPT, the SCI and the INSA have questioned the need for such rationalisation on the ground that there is no congestion at the Anchorage at all.  The MBPT has cited data to show that this is not so.  Be that as it may, there can be no objection to having a rationalised arrangement for keeping vessels at the Anchorage.  This will smoothen operations irrespective of ups and downs in traffic.   

(iv).       Questioning the logic of the arrangement relating to differential rates, the MANSA has pointed out that vessels will always opt for the cheapest site.  The purport of this contention is not clearly discernible.   As has been pointed out at (ii) above, the differentiation has been introduced with reference to factors like proximate location, draft, etc.  Within the system envisaged, vessels will obviously have their options.  There need be no objection to a vessel choosing the cheapest site relevant to its purpose and requirement.  In this context, it is also relevant to recognise that many of the cheaper sites are stated to inoperable during the monsoon period.  There is thus a logic in the arrangement proposed which has apparently escaped the attention of the MANSA.

(v).        The SCI and the INSA have described the revision as being excessive; a 100% increase in 1988; and, another 100% increase proposed now.  In the light of the fact that ‘free days’ are also proposed to be reduced, such a steep increase will become unbearable.   

            As has been pointed by the MBPT in its reply, the increase in Anchorage fee approved in 1998 was not 100%.  From a fixed rate per day, it was changed to be based on the GRT of the vessel.  The increase becomes 100% only in respect of larger vessels above 24,000 GRT.  Significantly, in the proposed rates, these charges work out to even less than the existing rates for some vessels at certain Anchorage-sites. 

(vi).       An apprehension has been voiced by the INSA that conversion of Lash Barges into Dumb Barges will give them scope to exploit the provisions.  The MBPT has discounted this apprehension.  They have categorically stated that Lash Barges converted as Dumb Barges will not be allowed to take any undue advantage.  The MBPT has given an assurance that it will go strictly by the Certification of the vessel.  The INSA has accepted this assurance subject to the understanding that it will be so incorporated specifically in the (revised) Schedule of Anchorage Fees.  This is a reasonable requirement. 

(vii).      Both INSA and SCI have also some reservation about the Note ‘C’ proposed.  In their opinion, its provisions are too harsh; it will be better to cover such cases also in Note ‘B’.  This apprehension, again, has been adequately allayed by the MBPT with the clarification that the differential rate has been proposed only for ‘Transhipment Barges’; Note ‘C’ will not affect barges coming into the MBPT.  The SCI and the INSA have accepted this clarification subject to the understanding that there will be such an unambiguous statement added to Note ‘C’. This is also a reasonable requirement. 

(viii).    There is also an objection to the proposed reduction in ‘free days’.   But, it cannot be said to be reasonable as the other objections by the INSA and the SCI.  This issue was considered by the Authority even while passing the earlier Order on 27 October 98.  That Order specifically recognised the laudable objective of reducing congestion at the Anchorage.   The reduction of ‘free days’ to 3 is only for the sites specified in Note A-1(a); in A-1(b) it is 5 days; in A-1(c) it is 10 days; and in cases coming under Note ‘B’, it is 30 days.   The Board of Trustees which had also gone into this question, was satisfied that the ‘free days’ in reference are enough for vessels to complete formalities for voyage or for berthing.  Seen in this backdrop, notwithstanding the increase of rates proposed, based as they are on a locational factor also, the ‘free days’ proposed are acceptable. 

(ix).       The INSA has raised a specific point about regular Lash Barge operation being considered without concession and being treated on par with ships to avoid it gaining undue (double) advantage as competitors, and demanded that the Note under ‘A’ must be elaborated to prevent any such exploitation by Lash Barges.  In the given wording of the Note ‘A’, no such ambiguity is apparent.   

8.                      In the result, and for the reasons given above,  the proposal of the MBPT to revise the schedule of Anchorage Fees is approved. 

9.                      The revised Anchorage Schedule approved by this Authority is attached as an Annex to this Order.

10.                    The MBPT is directed to incorporate the revised Schedule of Anchorage Fees in its Scale of Rates.

11.                    The revised Anchorage Fees shall come into effect after the expiry of 30 days from the date of publication of this Order in the Gazette of India.

S.Sathyam, Chairman

[Advt./III/IV/Exty./143/2000]

ANNEXURE

SCHEDULE OF ANCHORAGE FEES

(A)     If any vessel or self propelled barge except Lash Barge or Dumb Barge remains at any anchorage points shown in column No.2 of the table below anchorage fees shall be levied as per column 3 ibid.

(B)      If any Lash Barge or Dumb Barge remains at any of the anchorage points mentioned in column No.1 of table below, anchorage fees shall be levied as per column No.2 ibid.

            (C)      Every Vessel, Boat, Barge and craft irrespective of the size or the GRT, engaged in Lighterage operations in midstream for conveyance of cargo to the Ports other than Mumbai Port shall during the period of their not working cargo be charged anchorage fees as per (A) above depending on the place of anchorage from first day of anchorage and no free days shall be allowed.  This differential tariff will not apply to barges coming into the Mumbai Port.

NOTES (I) For the purpose of calculating the period of stay of a vessel at an anchorage :

(1) ‘day’ means a calendar day, i.e. the period from the mid night of a day to the midnight of the following day ;

(2) the period of free days mentioned in the schedule will be reckoned from the midnight of the day following the day on which the vessel completes its anchorage ;

(3) the day on which the vessel vacates and sails out of the Port will be counted for the purpose of the period for the levy of the anchorage fees ;

(4) in the event of a vessel which had stayed at an anchorage taking berth or entering a dry dock and returning thereafter either to the same anchorage or to another anchorage, the number of days the vessel was away from the anchorage will be excluded, but the period of occupation except for such exclusion will be treated as a continuous period for computing the Anchorage Fees ;

(5) the day on which a vessel leaves an anchorage and takes berth or enters a dry dock and the day it takes anchorage again will be counted as one day ;

(6) for levy of anchorage fees, a barge is a craft operating within the limits of Mumbai Port for the purpose of lighterage of cargo or supply of fuel, water and provisions but shall not include lash or any other type of barges/boats discharged or loaded by mother ships outside the limit of Mumbai Port for all purposes of conveyance of cargoes ;

(7) no anchorage fees will be recoverable from the vessel, boat, barge and craft (including lash barge) which has paid the licence fees for water conveyance as per table XIII of Port of Mumbai Pilotage, Tug Assistance, Towage, Mooring and other services fees order 1998 ;

(8) no anchorage fees will be charged to the vessel classified as Indian Naval Vessels and Coast Guard Vessels ; and,

(9) no anchorage fees will be charged to the vessels/ships at MFL area.

(II)        Vessel classification will be strictly in accordance with the Certification of the Vessels.