IMPROPER ASSESSMENT OF DETENTION FEES CARRIER WAN HAI PENALISED WITH A HEFTY FINE

The Carrier Wan Hai has come to the forefront for the wrong reasons. Wan Hai is paying for an investigation into the detention fees it had wrongly charged against 21 containers in Southern California in 2021. Wan Hai has been forced to cough up USD 850,000.00 as a civil penalty as per the agreement with the US Federal Maritime Commission (FMC) Bureau of Enforcement (BOE)

When is A Detention Fee Imposed?

Detention fees surface in cases where the shippers fail to return an empty container within the time limit specified in the ocean freight contract. The carriers can charge the shipper in such a case. But in the case of the Wan Hai penalty, the shipper complained that the carrier was carrying improper assessment, as they knew that the containers could not be returned “knowing and willingly.”

This is the second major penalty two weeks after Hapag Lloyd was charged USD 822,220.00 in April for the same improper assessment. In the Wan Hai penalty, the FMC’s BOE assessed that 21 empty containers were wrongly charged with detention fees when their owners were offered no return locations or when the designated terminals were not accepting the container chassis or appointments were made unavailable for the containers.

The Findings of the Investigation

In an investigation led by the FMC in December, it was found that invoiced amounts for detention ranged from USD 125.00 to USD 1,550.00. It was noticed as a finding that the shipper had made an earnest attempt to return the containers but was refused to be acknowledged and slapped detention fees instantly as the carrier could not provide them terminal space or even schedule a reappointment. The investigation produced proof by the shipper showing screenshots where they asked the carrier to waive the amount as no promised service was provided, and they were refused.

The Wan Hai penalty follows immediately after the Hapag Lloyd case, which happened in mid-2021, where the drayage operator Golden State Logistics tried to return 11 empty containers but could not do so owing to uncontrollable factors. The judge in the Hapag Lloyd case stated, “it was looking into the ruling and will then decide further legal action.” This pushed forward the Wan Hai penalty as a settlement between BOE and the carrier Wan Hai. The carrier has agreed to pay the fine and no longer collect such detention fees from unnamed parties related to the 21 containers. The agreement said that it is not to be construed as an admission by the carrier on the violations in the December investigation and also stipulates that the BOE will take no further action against the carrier.

Ripple Effect of the Penalty

The CEO of the Harbor Trucking Association, Matt Schrap commented about the decision as “another chink in the armor for carriers on this issue; the veil has been pulled back.” The volume of complaints has risen since March, as the penalties levied in these cases have helped the offended parties file cases involving what they deem improper assessment of detention and demurrage fees by carriers.

As a part of inviting such complaints, the FMC issued a Dec 28 notice as part of an ongoing investigation regarding excess fees with a shipper advisory group urging the commission to investigate further from carriers to terminal operators. Presently, California’s federal and state legislation is actively involved in tackling the issue.

THE NEW JUDICIAL FEE LAW OF THE KINGDOM OF SAUDI ARABIA

Recently the Courts and Legal System of the Kingdom of Saudi Arabia introduced a new Royal Decree No. M/16 on 30/1/1443H to amend the judicial cost systems and implement the court fee for the newly filed legal suits. The new Law came into effect on 13th March 2022, encouraging litigants to settle their disputes amicably.

Even though the filing charges are already in existence in most countries, this is the new implementation by the Courts in Saudi Arabia, where there have been no filing charges or court fees since the inception of the Civil Courts in the jurisdiction. Since there were no filing charges earlier, the courts in Saudi Arabia were struggling with voluminous cases, which resulted in lengthy court proceedings and delays in pronouncing decisions.

The new Law applies to all lawsuits, petitions, and requests submitted to the Courts except Criminal Cases, Disciplinary Cases, or Cases relating to the Provision of Bankruptcy Law. The Law also exempts specific categories from paying the court fee, including the claim brought by the employees about their employment contracts and claims commenced by ministries and government bodies.

The new Law, or “Judicial Fee Law,” stipulates the different fees applicable to claims and applications. When the Law sets a certain percentage of the claim amount as the court fee payable for various categories of Civil Suits, including but not limited to the legal suit to nullify the Arbitral Award, the maximum ceiling of court fee is set out is SAR 1,000,000 under all categories. However, the fee shall be reduced to 25% of the fee payable if the parties settle after the first hearing but before the court’s decision in the case, and the balance shall be refunded if paid. Further, the Law also states that if a request results in a change in the estimation of the value of the case, the judicial costs of the case will be calculated based on the estimation of the new value thereof.

The Law also has a provision for refunding the entire amount of Court Fee paid in the event of (1) If the decision or Judgment pronounced in favor of the Plaintiff or the Claimant; Appellant or Applicant; (2) If the Claimant withdraws the claim by the applicable rules before the first hearing; (3) If the Parties settles the dispute before the end of the first hearing; (4) If any Civil claim was raised alongside the Criminal Proceedings and the Civil Claims is settled between the Parties regardless of the stage of the case.

However, it is also to be noted that except in limited circumstances, failure to pay the court fees does not prevent the court from hearing and determining the claim and application.

ODYSSEY

Rahat Talreja

Vice President – CSS India Operations

…Tring Tring…

Steve, the freight forwarder: Hi it’s Steve

Exporter: Morning Steve, I have urgent cargo to airfreight from Heathrow to

JFK New York

Steve: What’s the tonnage?

Exporter: About 1 ton.

Steve: That’ll be 2 Pounds and 10 cents on British airways.

Exporter: Got that, Steve; sending the cargo today to your warehouse. Has it shipped on the 1st flight?

Steve: Don’t worry about it. We have daily flights to New York from

Heathrow, the cargo won’t wait.

Are you shocked? Not at all. It’s 2022, not 1940. This is a very, very normal conversation in 2022.

So now, let’s see the next conversation, sometime in 2045.

…Tring Tring…

Suzy, the space forwarder on Space Station Mars.

Exporter on Earth: Suzy, it’s Sven from Earth.

Suzy: Sven, how can I help you.

Sven: I got cargo to ship to Mars for my cosmic hotel this week. If you ever need a room, let me know. I got a Mars view room.

Suzy: Thanks, Sven. I have options on Virgin, Space X, Axiom , ESA,

Roscosmos.

Sven: I also have an accompanying technician with the cargo. Tell me the price

Suzy: 60 Million Space Francs

Sven: I’ll have it wired today. You’d like a 50% advance on the Mars account?

Suzy: Sure. Thank you, Sven.

Are you shocked? Yes, but no. We know it’s coming. This is going to be an everyday conversation in the next 20 years.

So as exporters, importers, entrepreneurs, and logistics executives, we ought to know the kind of cargo that will be transported to and fro Earth to Space Stations across the solar system. And the opportunities available for future business ventures and investment.

Protective Suits

Space First Aid Kits

Space batteries for vehicles

Space horn to send signals to other astronauts

Terraforming

Space base construction technology, glues, mortars

Meteorite protection technology

Solar Batteries

Spacecraft Navigation and communication services, repair and insurance

Components and Accessories for Space rockets

Space weapons

Space debris

Space Production: Zero gravitational manufacturing

Space backpacks

Creams and Products for ultraviolet radiation protection, force fields protection.

Components and Accessories for spacecraft, rockets, and space stations

New durable materials for building structures in space like graphene and fullerene

Space energy charging points

Space weather forecasting and remote sensing

Space internet and communication systems

Space tourism: Cosmic Hotels, Hostels, Cosmic Holidays, and Travel

stations, trips to planets, moons, asteroids

Space Taxi

Space sanatoriums

Space Summer schools

Space Healthcare and Therapy for muscle wasting due to lack of gravity

Space Food

Space Law

THE PANDEMIC – A BOON FOR SHIPPING COMPANIES AND A BANE FOR SMES

The year 2022 does not indicate any likelihood of a sudden decline in ocean shipping rates. This means another year of booming profits for global cargo carriers. However, small businesses and consumers are paying the price. They are forced to pay sky-rocketing freight costs as cargo giants mint profits. The market shows the nature of a spot market where the price of a 40-foot container to the U.S. from Asia stood at $20,000 last year, inclusive of surcharges and premiums, which had initially been at $2,000 a few years ago.

Unlike the big giants like Walmart Inc. and Ikea, who can tackle the high rates, the small exporters and importers cannot easily pass through these costs or weather long periods of stretched cash flows. Amruth Raj, the managing director of Green Gardens, a vegetable processor, says, “Small and medium-sized enterprises are being badly affected. They exploit our desperation.”

The future spells 200% higher elevated prices as tight container capacity and port congestion have maxed up chances for long-term rates in contracts. Achil Yame, Cameroon National Shippers Council, stressed that this inequality is heavy on the African countries. “If nothing is done to reverse the trend, the risk in terms of inflation and food security can grow very, very high.”

Windfall Leading to Inflation

The British International Freight Association is one of the latest who has called on the U.K. government to investigate the “distorted market conditions” in the global container shipping market arena. The surging shipping transportation cost has been responsible for stoking inflation and clouding the recovery.

The Kansas City Fed economist Nicholas Sly has researched and found that a 15% increase in shipping cost leads to a 0.10 percentage point increase in core inflation after a year. He stated that shipping rates are currently a persistent challenge. “These types of shocks tend to last for 12 to 18 months.”

Twenty-five years ago, 20 companies controlled half of the global capacity. Today, it has come down to 10 container lines that contain nearly 85% of the capacity for shipping goods by sea. These lines are based in Asia and Europe, the more familiar ones being Maersk, MSC, France’s CMA CGM SA, and China’s Cosco Shipping Holdings Co. Nine of them operate under vessel sharing agreements called “alliances” though being competitors. These alliances allow them to coordinate schedules and share ship space.

Rising Freight Rates

The pandemic showcased how the carriers drove the market with a bullish frenzy by holding the economy and then ramping it with crazy rates. The contract rates on ocean freight locked in high shipping costs into 2023. A Pennsylvania-based importer MCS Industries Inc., filed complaints against MSC and Cosco, stating that they have been “Operating in tandem to exploit the Covid-19 disruption to profiteer at the expense of U.S. consumers.”

James Hookham, Global Shippers Forum Director, states, “We believe this market needs some investigation to make sure those customers are not being abused. This market is not working to the benefit of everybody.” Mario Cordero, former chairman of the FMC and Executive director at the Port of Long Beach, said it’s a “confluence of factors” that have led to the tangling of the global supply chain in the wake of the pandemic. He states that “I’m not suggesting we’re over this.”

During the first lockdown in March 2020, the Chinese and American economies reopened. Government stimulus payments began flowing, bringing consumer demand for goods such as exercise bikes and home-office desks. By the third quarter of 2021, world trade in goods hit a record $5.6 trillion and was on pace for an equally solid number in the year’s final three months.

Demand Driven by Shortages

The sudden demand disrupted the supply chains as most U.S. ports couldn’t process imports fast enough, trucking companies fell short on drivers, and warehouses ran out of space. Because of port congestion, fully loaded ships stayed put on California beaches for weeks. Suddenly everything halted.

In November 2021, the White House called on the Federal Maritime Commission (FMC) to “use all of the tools at its disposal to ensure free and fair competition.” Since then, the FMC has increased carrier alliances’ monitoring to better track trends and spot potential illegal behavior, such as artificially limiting supply or not competing on prices. The agency’s chairman, Daniel Maffei, says that there are little regulators can do to rein in more widespread potential under current U.S. law. “The fact is that it is very, very difficult, if not impossible, for the FMC to challenge these alliances for violating competition requirements,” said Maffei, noting that he has no evidence that they currently are. “We don’t have the practical tools necessary to challenge it.”

Last year a bipartisan bill was passed in the U.S. aimed to reform U.S. shipping laws. It would give the FMC greater authority, prohibit carriers from discriminating against American cargo, and give businesses more power to challenge carrier fees. The European Commission is “closely monitoring the container shipping industry and is aware that there have been large price increases,” the commission said in a statement. Lori Fullmer, vice president of logistics and carrier management at BassTech International, says she’s had shipments rejected multiple times, “In some cases, there was no getting space on a ship,” she said.

The Sri Lankan Scenario – Slumping Capacity

Exporters of the apparel manufacturing industries in Sri Lanka are struggling to meet orders as carriers shift their vessels to lucrative routes connecting China to the U.S. and Europe, said Sean Van Dort with the Joint Apparel Association Forum Sri Lanka. “Yes, they have to make money, don’t get me wrong — but when you have ten times, twelve times, sixteen times higher freight rates — there’s something radically wrong,” he said.

Chairman’s Message

2021 was indeed a tumultuous year. Most of the world was in lockdown for almost half the year while facing the highest freight rates in addition to the tightest space crunch in history. Despite the turmoil brought on as the aftermath of the pandemic’s first 2 waves, CSS Group ended the year on a triumphant note. We achieved some significant milestones that I wish to remind you about. One of which was the Art Logistics service coming into full force, offering logistical support to the burgeoning demand for fine art movements across the region and beyond. And then the following were other achievements that 2021 brought with it.

Strategy Meet at Georgia

At our Annual Strategy Meet that took place in the gorgeous country of Georgia this time around, once again we raised the bar for ourselves with respect to our strategy for the coming year. To start with, we launched two new concepts at the meeting. The first being, the new vertical called eLogix that will provide e-commerce fulfillment services. The second exciting launch is the CSS Mascots, who will be the face of our company. You will make a close acquaintance with Charles the Truck, Wilbur the Plane, Ferdie the Ship, and Pack Packs on the pages of this magazine.

ELogix for E-Fulfilment

The growth-spurt in e-commerce activities that we saw, was no surprise with people conducting most of their shopping from the comfort of their homes rather than stepping out in the past 2 years. The UAE retail e-commerce market itself reached $3.9bn in 2020, a 53 year-on-year increase. In 2022, the forecasted value of e-commerce sales in the UAE is pegged at around $27 billion. In addition to this, with high social media penetration in the GCC region, the e-commerce market has certainly witnessed an extremely rapid growth. And with this growth, and the growing need for e-commerce fulfillment services, coupled with our expertise and experience in deliveries, we agreed this was the perfect footing to launch eLogix – our new vertical that will enable us to provide fulfillment services to our clients.

Going the Distance, Together

Remembering a particular African proverb, “If you want to go fast, go alone. If you want to go far, go together,” I would like to pay particular respects to our customers, partners and bankers for their continued trust and support, for it is because of them that we are able to envision what our bountiful future would look like. Without the support from our vendors, there is neither any way that we would enjoy our current success nor be able to plan for our future. Surely the same goes for the clients who have become family and whose trust we value so greatly. It is these relationships that we have always held so dear and who have helped us succeed, truly.

What Money Can’t Buy

While money can buy you most things, one of the key elements that money cannot buy is Experience, which is most vital when it comes to sustaining oneself when up against ‘The Impossible’. We have surely seen some of the toughest times in the last 2 years, but it is at times like these that the ones with formidable experience are the ones who clearly and calmly would show us a way out, for us to come winning at the other end. And I am proud to say that we have some of the best amongst the CSS family who repeatedly serve as guiding lights at any unforeseen situation, by way of providing solutions or improvisational skills that would only come with the experience they have garnered.

And with that, I would like to thank every member of the CSS family for their dedication and hard work over last year. It is your efforts that helped us surmount the challenges in 2021. Let us continue to work together towards the common goal of taking CSS to greater heights.

We are wishing you all a very Happy New Year!

ANNOUNCING THE LAUNCH OF CSS ELOGIX

CSS is proud to introduce a new service vertical called CSS eLogix. Focused on e-commerce fulfillment services, CSS eLogix aims to provide seamless e-commerce logistics services to our clients. Our reliable, flexible, and scalable solutions with super-quick and accurate order fulfillment, CSS eLogix will be helmed by Britto Satheesh, who takes charge of the entire operations of the e-commerce fulfillment vertical.

An online shop can have all the bells and whistles with a fantastic user experience, a vibrant social media presence, and great Instagram ads, however, if the online venture does not have the right fulfillment strategy in place, it might be a failed venture in no time.

CSS eLogix offers a resilient and cost-effective supply chain for all types of e-commerce ventures, from online marketplaces and small-scale online retailers to medium and large enterprises across a broad spectrum of industry verticals. We have developed, implemented, and integrated the best technologies, systems, and processes to create world-class warehousing and fulfillment solutions.

CSS eLogix’s focus is to enable e-commerce outfits and brands to focus their attention on their marketing and sales efforts, while we look after every aspect of storage, fulfillment, and delivery at the operational end.

Our Key Differentiators

1. Pick & Pack: We provide picking, packing and shipping of your orders with speed and accuracy.
2. Economical: Our fulfillment services will help you cut costs by minimizing shipping timelines and costs.
3. Advanced Software: Our software allows for real-time updates on your inventory across fulfillment centers and marketplace platforms.
4. Returns Management: We help you manage your returns for hassle-free operations.
5. Customer Support: On-demand customer support is provided by dedicated team managers.
6. Reliability: You can rest assured that your customer will receive the order within the stipulated time after clicking on the “Buy Now” button.

We had a Q & A session with Britto Satheesh to understand how CSS eLogix intends to roll out the e-commerce fulfilment services.

Why should an e-commerce venture choose CSS eLogix for their fulfilment?

Digitization has been on the charts for most companies in markets across all geographical boundaries. The whole world has been slowly and steadily marching towards e-commerce trading and digitized trading – ‘slowly’ being the operative word. That was until COVID-19 came upon us. With pandemic-induced lockdowns enforced almost in every corner of the globe, digitization of trading and online markets gained momentum like never before. COVID-19 and global lockdown scenarios have inevitably changed the way we look at retail experiences.

More specifically, it has changed the way we shop. It has changed the consumer experience and expectations entirely. While we have seen a portion of the population return to the physical shops as restrictions on movement have eased, it is anticipated that the pre-COVID numbers may never return. This is especially the case in the UAE, where the retail sector relies heavily on the presence of tourists.

Due to various restrictions, including social distancing and other health and safety measures, combined with the increase of retailers and service providers moving their offering online (to some degree at least, if not in its entirety) means that the stage is firmly set for e-commerce to grow in the coming months and years.

When e-commerce activity flourishes, the need for e-commerce fulfillment is inevitably necessary. For the last 26 years, CSS has primarily focused on growing its verticals in the logistics industry to expand and re-affirm its services in the Middle East and Asia. And with the expression, “strike when the iron is hot”, we believe the time has come to move into the e-commerce capabilities space. This sector is still evolving and has not reached its full potential in the Middle East. CSS eLogix came into an e-commerce company as we delved into the online trading industry. With the sole purpose of enabling our clients to deliver their goods better, our service will help in reducing costs and enhancing efficiency.

Is CSS eLogix an e-commerce or an e-commerce fulfillment company?

Good question! This can confuse even the seasoned professional in the logistics industry. CSS eLogix is an e-commerce fulfillment company. Unlike other e-commerce companies and marketplaces like Amazon, Noon, Shopify, etc. we do not sell any products through our website. Our services are warehouse management, inventory management, and last-mile delivery management. These three service offerings form the three crucial pillars. We understand that these pillars are critical to the functioning of e-commerce f u l f i l l m e n t centers. To put it simply, the moment when a customer clicks on the “Buy” option either from Shopify or any other online platforms, the orders are then executed through our portal. We get the order, execute the pick and pack, and ensure the items are delivered in a timely manner to the customer.

Does CSS eLogix want to sell products through their website?

Yes, that is the long-term plan. But for now, we would like to concentrate solely on e-commerce fulfillment.

What are the attributes that set CSS eLogix apart from the other players in the field?

The e-commerce market in Dubai lies largely untapped, and this can be pegged at an astounding 75%. This big portion of untapped potential can directly result from having fewer fulfillment companies, unlike the western world. However, post-Covid, there is a surge in need for fulfillment companies. Backed by CSS’s logistics experience and prowess, along with its exceptional track record that spans more than 25 years, we intend to instill a similar spirit into our venture, eLogix.

Our #1 USP would be to deliver the products to customers within 2 hours from when they click to purchase. We also work on real-time inventory. Suppose one of our clients has their products on different platforms and a customer decides to purchase an item from any of those platforms. In this case, the inventory for that item on other platforms will be updated automatically. Therefore, this gives our clients a time-efficient way to manage inventory on a real time basis.

I realize that you have a very interesting slogan and, above all, a catchy mascot to go with your vision. What is the message that the brand wants to convey?

The Middle East has always been the hub for developmental strategies and plans. New infrastructure and the best soughtafter technologies are developing at a pace that no other country can match. So, it was perfect for CSS eLogix company slogan to be based on “time” and how it can be managed. My dad often says, “Time waits for no one.” We thought that this saying echoes our brand values. It conveys the importance of fulfillment service that we can offer our customers. To do this, we needed to create a mascot that revolved around the concept of time, and that’s how Ti:Me (pronounced as Timmy) came into being. We want Ti:Me to be the face of our company, and when anyone thinks of e-commerce fulfillment, Ti:Me should be the first thing they think of.

What is your vision?

We want customers to enjoy their online purchases, and above all, we want to enhance their experience when it comes to trusting companies in delivering their goods safely and professionally. Our services should exemplify excellence, trust, and above all, safety and security for anyone who wishes to choose us to be their partners. We want to remove all the hassles a customer may have to face during an online purchase. We want the customer to sit back and relax while we deliver their goods with our professional and expert services. It could be just apparel or accessories or gifts for their loved ones. Whatever the product, we want our customers to think of Ti:Me and engage with us in putting a smile on their faces when they receive their package on time and without any hassles. We aspire to establish ourselves as the number one fulfillment company across UAE and Middle East, thus setting the standards for excellence.

CSS TEAM SPIRIT ON DISPLAY AT THE ANNUAL CHRISTMAS AND NEW YEAR PARTY 2021

Yes, 2021 has been an uphill drive, as is with almost every organisation worldwide. But as always, CSS has managed to ride the wave and this year as well. We have worked together to overcome the hurdles, and we have managed to emerge triumphant against all the odds that were lined up against us.

And with such a rollercoaster of a year, the closure of it brings good cheer! And surely what better time to get together and celebrate our victories with our yearend Christmas & New Year Party. As always, the CSS office premises and the warehouse were bedecked with festive decorations echoing the season’s spirit.

Keeping with the CSS Group tradition, the kick-off of the jolly season was with ensuring our offices were adorned with the festive feel, followed by quick games & entertainment through the week and the finale being our popular Potluck with everyone participating with much harmony and merriment.

It was a day of great camaraderie, displaying the hearty team spirit of our CSS family. The party buzz was evident in the air, and it was indeed a much-needed break from the day-to-day grind.

Another part of CSS’s year-end tradition is honouring & celebrating our warehouse team by presenting each of them with Christmas gifts at a gettogether catered specially for them. Every year, there is special attention given to this particular event with the rest of the organisation pitching in to help, for it is a known fact that this warehouse family is the primary reason for the success of CSS Group’s ever-growing & renowned consolidation operations.

At CSS, we lay great emphasis on celebration. We believe that as we come together, our bonds become stronger. And to state

very clearly, the hard work and team spirit displayed by each member of the CSS Family has made us what we are today. So let’s look ahead with positivity, to a new year that is filled with good health, good fortune and joy. May the year ahead cause all of us to forge ahead and scale new heights of success while overcoming any difficulties that we might encounter with confidence, conviction and finesse.

CSS STAFF TAKES PART IN THE DUBAI RUN 2021

On Friday the 26th of November 2021 Dubai’s Sheikh Zayed Road became a giant running track for the annual Dubai Run 2021. CSS Group also participated and was represented by Alan Ramesh (Marketing Assistant) and Babu Krishna Pillai (Documentation Messenger).

With a total of 146,000+ participants the highway saw a sea of human beings in action mode. Dubai’s arterial road attracted people from all walks of life cutting across age barriers as they came in unison to celebrate Dubai’s spirit of enthusiasm and community.

His Highness Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, the Crown Prince of Dubai, being a fitness enthusiast himself, championed this challenge passionately. He was at the starting line, that had the backdrop of the Museum of the Future. Sheikh Hamdan posted a video on Instagram stories of himself at the run with a simple one-line motivational message: “Let’s do it.”

Sheikh Hamdan has been the force behind the Dubai Fitness Challenge – a month long fitness initiative to promote a healthier and fitter Dubai. As a part of the Driveway Fitness Challenge, UAE citizens, residents, and visitors are invited to partake in 30 minutes of exercise every day for 30 days, and the Dubai Run has been one of the main events within it. He expressed his exhilaration about the event, “Running alongside 146,000 people who completed the Dubai Run today, I was moved by the strength of our community and seeing what we can achieve when we work together. By turning out in such numbers, we have shown the world that this is one of the greatest cities to live in, work in and visit; a city with an unassailable spirit and ability to achieve.”

While families, amateurs, and those out for a day of fun generally did the 5km run/walk, some of the world’s top athletes ran alongside recreational runners and aspiring running champions in the 10km stretch. They included a team of elite Kenyan runners who have been participating in several DFC events and activities.

It was indeed a run to remember as the route took them past the iconic landmarks of Dubai like the Museum of the Future, Emirates Towers, Downtown Dubai, and Burj Khalifa.

The first run took place in 2019 and followed in 2020 as well. Last year, it was reorganized on different routes due to social distancing during the pandemic. The Dubai Fitness Challenge 2022 will be held from 28th October to 26th November

FREE ZONES – UAE’S SUCCESSFUL DIVERSIFICATION STRATEGY

UAE is home to 45 free zones across the country, notably the highest globally, with ten more under construction. Defining a large part of the country’s private sector growth, these zones attract marketing, trade, and investment opportunities that accelerate the growth and success of the country’s finance, IT, logistics, trading, and media industries.

As of February 2021, more than 60,600 companies are registered in the country’s free zones, invariably accounting for eight percent of the total number of companies registered in the UAE. The government’s targeted efforts have helped the country achieve the position to become the most favorable business destination globally in recent years. Incentives for start-ups, entrepreneurs, and freelancers include reduced registration fees, visa extensions, and capital finance.

The free zones include prominent pillars of the private sectors related to trade, industry, energy and renewable energy, media and communications, metals and commodities, finance, healthcare, and IT.

JAFZA and DMCC – The Path Breakers

Dubai is now home to 30 free zones, including giants like JAFZA and Dubai Multi Commodities Centre (DMCC). UAE’s first free zone -the Jebel Ali Free Zone Authority (JAFZA) caters to over 7500 companies and accounts for 28 percent of Dubai’s GDP. Another feather in its cap is that JAFZA is the largest free zone in the world. That which started as a central pillar of economic diversification, JAFZA is today the blueprint for establishing several other free zones across the GCC. The DMCC is the largest and fastest-growing free zone in the UAE, which marks the country’s appeal for its budding multicultural international entrepreneurs.

Dubai is right now identified as a de facto-free zone hub.

Benefits of Being Under The Free Zone Umbrella

So what exactly is the lure of being under the free zone?

Largely defined by flexible policies surrounding foreign ownership, labor regulations, taxes, etc., the other benefits are:

1. Foreign entities under the free zone enjoy 100 percent ownership circumventing foreign ownership policies with ease.
2. Attraction of global talent to UAE as there are no adverse regulations to foreign labor.
3. Apart from being exempt from taxes and fees like custom duties, the companies are allowed 100 percent capital and profit repatriation.

In short, the free zones bring over job opportunities, competitive salaries, a solid knowledge base, and an overall level of excellence.

Ancillary Services

Free Zone authorities extend ancillary services for legal, medical, labor, and immigration. The free zones also provide freelance permits to international branch office licenses from shared desk space on annual contracts to industrial warehouse leasing for 25 years. Simply put, everything is designed to attract and help investors build a business, grow trade and investment and facilitate the transfer of skills, knowledge, and technology.

Success in Times of the Pandemic

While industries worldwide were fighting to survive the pandemic, the free zones in the UAE stepped up their efforts to strengthen the business climate by launching several initiatives. This helped the government pick up the broken pieces of the economy in the form of health crisis and dip in oil prices. This was achieved largely due to the economic policy tools that was in place by the UAE government. For example, the Umm Al Quwain Free Trade Zone started the business LYTE packages that help prospective investors continue with their business set up plans with a neat 50 percent off. Also, acquiring licenses was done in just days compared to the earlier timeframe of ‘months’. Some free zones in the UAE introduced online services for investors, while others recorded an increased number of new registrations and business expansions, with technologyfocused sectors seeing higher traction.

Foreign Policy Objectives

As part of the agreement between UAE and Israel to normalize friendly relations, many of the newly formalized commercial links came to fruition among Gulf Free Zones. Dubai uses its flagship commercial entities to cement ties with its Israeli counterparts. In September, DP World formerly known as Dubai Ports Authority, and several government entities signed agreements with Israel-based Dover Tower Group to assess port and free zone development opportunities in Israel and establish a direct shipping route between Eilat port and the UAE port of Jebel Ali.

Encouragement for Developing Clusters

Free zones will continue to encourage the development of clusters, enhancing the UAE as a hub that encourages broader build-out of specialized infrastructure and develops sectors that are key to the economy while also facilitating job creation. Noting that free zones have become an integral part of the diversification plans of each Emirate, there is likely to be divergence in the development trajectories of such business hubs. The Israel Diamond Exchange and the Dubai Diamond Exchange, which is part of DMCC, agreed to enhance cooperation in the diamond trade.

Free zones are more likely to support the development of technology-based strategic industries and offer global investors attractive growth propositions. As the country continues to build on strategic focus industries, flexibility and multipurpose utility will be the key traits of successful free zones in the UAE.

FIFA WORLD CUP! “GETTING YOU IN THE GAME” FORUM: INDUSTRY EXPERT LOGISTICS LINE-UP REVEALED

As one can imagine, Logistics is critical to an event as large and complex as the FIFA World Cup. And it is no wonder that Logistics industry giants, GWC Logistics, was awarded the honour of Qatar’s Official Host Nation Logistics Provider for the FIFA World Cup 2022.

GWC Logistics was established in 2004 and has become a key player in the region’s logistics and supply chain sector. The company offers end-to-end logistics and supply chain solutions to many FMCG, Oil & Gas, Fine Art, Pharmaceuticals industries, to name a few. GWC also provides consulting, record management, and local and international relocation services.

On 16 November 2021, GWC revealed its panel of top industry experts for a virtual forum called ‘Getting You in the Game’.

FIFA’s Head of Event Logistics, Jose Dhooma, said in his keynote speech, “There has never been a more appropriate moment to discuss the role of logistics in the delivery of mega-events. This year, we have seen the critical role of logistics in the world’s economy, and now, with almost a year to the FIFA World Cup Qatar 2022, this forum is bringing together panels of experts to discuss and bring you further into the game of delivering logistics for mega-events.”

The forum featured two panels and two workshops. The first panel focusing on mega-event logistics featured Kirsten de Bruijn, Senior Vice President Cargo Sales, and Network Planning at Qatar Airways. Mark Novack, HC Event Logistics Assistant-Director at the Supreme Committee for Delivery & Legacy. Christopher Nelson, Operations Manager, Middle East Region inKObator, at The Coca-Cola Company and Mathew Phelps, General Manager at GWC. The discussions show-cased “what it takes to create a winning formula to turn visions of events’ enormity into a reality”.

The second panel included Afraa Al Noaimi, Executive Director at Josoor Institute. Laila Al Jefairi, Vice President of Business Development at Qatar Financial Centre, Bader Al-Madhadi, Investment Promotion Lead at Qatar Free Zone Authority, Lauri Becquart, Head of Retail & Private Holdings at Google Cloud and Hamdan Merchant, Senior Director, Innovation, IT & BPI at GWC. The panel analyzed the role of digitalization in the Middle East region and identified the impact of investments in making it an increasingly attractive place for largescale events.

Both panels were moderated by Al Jazeera English’s Senior Presenter Emily Angwin.

Two workshops followed the panels:

1. GWC’s large-scale planning to execute FIFA World Cup Qatar 2022, led by Syed Maaz, Chief Business Development Officer at GWC

2. The legacy of sustainability that the World Cup will leave behind led by Meshal AL Shamari, Director at Qatar Green Building Council.

The FIFA World Cup Qatar 2022 will take place from 21 November 2022 until 18 December 2022 in eight stadiums around Qatar – three of which are already fully operational, with two more scheduled for completion by the end of 2021. GWC has a logistical infrastructure covering more than three million square meters, including the region’s largest privately owned logistics hub, along with a team of dedicated and innovative specialists and state-of-the-art IT systems. GWC on board as a Regional Supporter and the Official Logistics Provider for the tournament will provide FIFA and its commercial affiliates with crucial support and expertise in logistics and supply chain management, which will ensure seamless efficient delivery of the competition.

“Logistics plays a significant role during sporting events to ensure the smooth and efficient delivery of complex, large-scale events, which involves executing a broad spectrum of logistics services in the lead-up, during, and after the final whistle. Moreover, the forum will bring attention to the hard work that goes into the FIFA World Cup Qatar 2022, turning it into a showcase for Qatar and the region,” said Group CEO at GWC, Ranjeev Menon.

TRANSPORT LOGISTICS COMPANIES RIDING GROWTH WAVE AS COVID WANES

After a year and a half of COVID-19 pandemic hitting the world, rays of revival across many sectors can be seen. And India’s logistics companies seem to be riding on a wave of growth after the waning of the second wave.

Transport Corporation of India (TCI), one of India’s leading supply chain and integrated logistics players, expects its net profit to grow 30%-40% and its revenue to grow 20% in FY22. One of the world’s largest logistics players, DHL Express, recently opened an airside facility in Bengaluru airport. The gateway is said to handle 650,000 to 700,000 shipments a month. The cargo facility in Bengaluru is one of the biggest investments the company has made in India, said the India Managing Director. French logistics player FM Logistics has recorded a 58% growth in its India turnover in the first half of this fiscal year.

Companies are bullish and are investing in new infrastructure in spite of global supply chain constraints and fuel price hikes. According to Vineet Agrawal, managing director of TCI, increased freight rates in coastal shipping have helped increase revenue.

Despite supply chain businesses having been affected due to a global shortage of semiconductors and their impact on the automotive and white goods industry, automakers are optimistic about the situation, and production has started to improve from the last quarter. Automotive companies, which were hit the hardest, have assured an increase in production, with hope that the overall market can absorb the higher fuel prices. Furthermore, in India, as elsewhere, a spurt in demand in some segments such as e-commerce has kept companies confident.

The global pandemic led to a prolonged partial closure of ports worldwide, creating a glut of containers in some ports and an abject shortage in others and of course freight rates and container prices have shot through the roof. Companies like the TCI have said it will only spend half of their planned capital expenditure of INR200 crores due to the increase in costs of ships and containers. About 60% of its CAPEX was to buy new container ships and containers. According to a report by ING, the supply of new containers will only ease the pressure by 2023.

Needless to say, many companies saw a big dip in revenue a year earlier. However, things are looking up. Most prominent companies are making noticeable investments foreseeing this trend. The new airside facility in Bengaluru airport for DHL will save 12-24 hours in terms of transit time for DHL’s customers.

Consolidated revenue grew 38%, and net profit trebled in the July-September quarter. Agrawal, says, “The estimate we are giving the street is, of a 30%-40% increase in the bottom line and a 15%- 20% increase in topline.”