haffa annual report 2010-2011 - fapaa · haffa annual report 2010-2011 ... a high level transport...

8/F, CHINA HONG KONG CENTRE, 122-126 CANTON ROAD, TSIM SHA TSUI, KOWLOON, HONG KONG. TEL: (852) 2796 3121 FAX: (852) 2796 3719 EMAIL : [email protected] WEBSITE: http://www.haffa.com.hk

HAFFA ANNUAL REPORT

2010-2011

For

FAPAA 38th Executive Council Meeting

Dhaka, Bangladesh

26th – 28th June 2011

Content

1. Chairman’s Report for the Year 2010-2011

2. Airfreight Sub-Committee

3. External Affairs Sub-Committee

4. FAPAA Liaison Sub-Committee

5. FIATA Liaison Sub-Committee

6. Greater China Affairs Sub-Committee

7. Information Technology Sub-Committee

8. Legal Matters Sub-Committee

9. Membership Sub-Committee

10. Policy Sub-Committee

11. Public Relations Sub-Committee

12. Seafreight Sub-Committee

13. SME Development Sub-Committee

14. Training Sub-Committee (attached in a separate file)


Chairman Report for the Year 2010-2011

Date: 12 April 2011 1. Brief overview Over the last twelve months, Hong Kong freight and logistics service providers have, on the back of the strong economic performance of the Mainland and Hong Kong, overcome the financial tsunami in late 2008 and experienced a record-breaking year. Air cargo increased 23.4% to 4.13 million tons, surpassing both neighboring airports and Memphis International Airport in 2010 to become the world’s number one international and busiest air cargo hub. Thanks to the collective efforts of our members and their business partners at the airport, we were able to maintain high standards in both operational efficiency and service quality while serving the largest volumes of cargo ever seen in Hong Kong. This reinforces our position as a leading international and regional logistics hub. Seaports handled a total of 23.7 million TEUs in 2010, an increase of 12.6% over 2009. Though Hong Kong currently lies third in terms of throughput, it could potentially be overtaken by Shenzhen. Sea cargo development serves as an industry indicator, and reminds us that we should plan timely responses to changes around us. In that regard, here are some of the events which we believe are having both a positive and negative impact on the shaping of our industry. 2. Events that are shaping our industry Security (Enhanced RAR and RAR + screening) In addressing the call for both security and trade facilitation, as these areas will continue to top business agenda in 2011, at the last HAFFA AGM in April we were honoured to have senior officials from the Civil Aviation Department provide details of the enhanced RAR. This was based on the “known consignor” (KC) concept that underlaid the original RAR, but with additional new requirements that will strengthen the documentation trail, in particular for KCs and KC vendors involved in a shipment. Subsequently, implementation meetings were held with the CAD and Shippers’ Council and we have been making every effort to ensure the necessary changes cause the minimum disruption to the flow of trade and cargo operations. The latest update from the CAD is that they have considered our many views particularly on the concerns regarding difficulties in contacting vendors in China during long public holidays in October; the CAD is considering moving the start date of enhanced RAR from 7 October 2011, to a date after National day and the subsequent golden week holiday. They will confirm the final implementation date as soon as practicable so that arrangements for comprehensive promotion can be planned. Hong Kong advanced security screening program – in progress Looking at the broader spectrum, in view of the new screening requirements introduced by the US TSA, HAFFA convened working group meetings with the CAD in order to express industry concerns that these would be impossible to comply with, both in terms of efficiency and quantity, as the current arrangement was established for CTO to mainly cater for the pallet handling and not 100% cargo screening for security purposes. Security screening at the terminal under increased global requirements will prolong the cargo acceptance process, and adversely affect the efficiency of pallet cargo handling. Hence, our gradually diminishing competitive edge will be further undermined. We are now exploring practical measures to cope with long-term global security requirements, such as providing options for forwarders to screen cargo at their own warehouses. HAFFA, together with relevant Government departments, plans to build upon the various schemes and, with reference to the AEO (Authorized Economic Operators) program, endeavour to establish a Hong Kong advanced security screening program which is achievable and practical. We will keep Members informed should there be any significant updates in this regard.

Infrastructure – 3rd Runway On air transport, we echoed the sentiments of the Airport Authority Hong Kong (AAHK) that we must ensure our airport is able to cope with air traffic growth. According to a recent report, the airport’s two existing runways are expected to reach full capacity by 2017. It is estimated that the construction of a new runway will normally take almost 10 years meaning that if development were to commence in 2011, the airport would still be operating at maximum capacity from 2017 to 2021. We foresee that shipments which cannot be transshipped via Hong Kong will be directed to other competing airports, most likely never return here. We have discussed this issue with the senior management of the AAHK, and will work with the Shippers’ Council to continue to urge the SAR Government to expedite the construction of the third runway.

Infrastructure – Construction of Airfreight CFS Warehouse Facilities at HKIA We have also proposed to the THB, CEDB and AAHK to build a centralized screening CFS facility at the airport for the industry, in particular for the SMEs. In view of the rapidly-growing demand for international air cargo security, the facility should be equipped with centralized scanning machines to enhance its capacities and maintain our competitiveness in the consolidation business. It is vital to have this facility in place and financed by the Government, particularly as it will assist SMEs forwarders to overcome financial difficulties associated with screening at their limited facilities, as well as improving lead time and overall costing. We requested for a reasonable rental rate & long term contract (or even permanent) in order to stabilize our costing as rental is the major cost in our industry. Customs Declaration As reported to Members via HAFFA News, a high level transport constituency delegation to Beijing, led by Ms. Miriam Lau, was held from 15-18 September 2010. The Vice Chairman and I were part of the delegation and met with representatives of the Mainland Government including officers from the Chinese Customs, National Development Reform Commission, Hong Kong and Macao Affairs Office State Council and the United Front Work Department of CPC Central Committee amongst others to discuss various issues related to transport and logistics development in Hong Kong. Following the delegation, Guangdong Customs has sent a positive written letter in response to the issues raised by us. We noted that the Guangdong Customs is now proactively communicating with the Hong Kong Customs to establish transitional rules for the one-time truck manifest e-declaration, based on the existing truck manifest (內地海

關及香港海關陸路進/出境載貨清單), with an aim of enabling our industry to submit the same data declaration simultaneously to both Customs authorities. Taking the opportunity, we shall work with the CEDB to better understand operational requirements, and hope to make it a success. IT infrastructure (RFID and Software Agent Technologies) The first ITF project designed to benefit air freight operations is entitled “Enhancing the Competitiveness of the Hong Kong Air Freight Forwarding Industry using RFID and Software Agent Technologies”. The project is sponsored by the Innovation Technology Fund (ITF) under the Logistics and Supply Chain Management Enabling Technologies Centre (LSCM R&D Centre), and carried out by the Hong Kong Polytechnic University (PolyU). HAFFA is actively participating in the project to hopefully excavate the maximum benefit to the industry. Thanks to all the Members who participated in a series of research activities, including system tests, pilot runs, workshops, surveys and interviews, the final results of the project were presented in full to the industry on 28 February 2011 at the Poly U It was learnt how RFID contributed to the efficiency of warehouse management and how the supply chain efficiency can be optimized by harnessing the power of RFID so that one day our industry this will be able to feel the real benefit of the hassle-free, secured, efficient and worthy technology.

Wine Storage Management Systems Certification Scheme (The first of its kind in the region) To cope with the robust growth of wine-related business activities in Hong Kong, the HKQAA has partnered with the industry, including HAFFA, to develop the HKQAA Wine Storage Management Systems Certification Scheme. The first of its kind in the world, the scheme has been championed by the industry and a significant number of wine storage facilities have already been awarded the certification, four of which are also HAFFA Members. THB also advised us that the Government had identified some permanent sites for developing a logistics cluster, and welcomed interested parties to bid for the sites for commercial use, including wine distribution and storage, through open tender. Education (Vocational Training Program) As part of an on-going effort to provide a structured training programme for new comers to the industry, the first Airfreight (M1) of VTP was launched in January 2010, and six classes are completed with over 90 graduates. Meanwhile, the first Seafreight (M1) was launched in March this year, with 30 students. Out thanks to the LogsCouncil and Vocational Training Council which have provided funding and tremendous support in various aspects. We are now in the process of developing the other modules and it is expected the development of the whole training programme to be within 2 years’ time. Please stay tune to the HAFFA news and we will keep Members posted of the latest status. To Better Meet the Needs of Members (Policy) Other controversial issues, such as rising fuel costs, an impractical policy on the absence of Transshipment Ordinance, insufficiency of land for security purposes and no precise transshipment statistics hampering the growth of transshipment cargo, a shortage of warehouse space, the imminent need for the third runway, Container Terminal 10 and the Hong Kong-Zhuhai-Macau Bridge, are only a few of the challenges we face. We will continue to collect views from Members as to how best to counter the pressure of Mainland airport developments in the PRD and would enhance Hong Kong’s status as the region’s logistics hub. 3. Year 2011 Outlook Considering the substantial improvement in shipment demand in the freight logistics sector we have seen during last year as we recover from downturn, I expect 2011 to be even bigger and more dynamic. Change is critical for this industry. I hope you will join with us as we continue to work together to analyze the health of our industry, discuss its issues, its challenges, attempt to solve problems, maximize opportunities, and demonstrate that the freight logistics industry is truly an important engine of economic development. Last but not least, I am confident that these challenging plans will bring benefits to our industry. I would like to thank all Members, the current executive committee and HAFFA Secretariat Office, which has been responsible for carrying out the works over the years, for their commitment, professionalism, contributions and hard work throughout the year. HAFFA is poised to serve Hong Kong freight logistics service providers to scale new heights and the industry to grow from strength to strength. Yours truly, Ir. Dr. Paul Tsui Chairman


AIRFREIGHT SUB-COMMITTEE Chairman: A-SONIC AIR FREIGHT (H.K.) LTD – Mr. Cliff Sullivan / Mr. James Chan Vice Chairman: DHL GLOBAL FORWARDING (HONG KONG) LTD – Mr. Edwin Tsang Members: AGILITY LOGISTICS LTD

ALPHA LOGISTICS (HK) LTD MORRISON EXPRESS CO LTD NAF NORTHERN AIR FREIGHT LTD NORMAN EXPRESS LTD THE JANEL GROUP OF HONG KONG LTD WANGFOONG TRANSPORTATION LTD WORLDTRANS AIR-SEA SERVICE LTD HELLMANN WORLDWIDE LOGISTICS LTD SEA-AIR LOGISTICS (HONG KONG) LTD

I. Liaise with the Civil Aviation Department (CAD) Security (Enhanced RAR and RAR + screening) In addressing the call for both security and trade facilitation, at the last AGM 2010 in April HAFFA was honoured to have senior officials from the Civil Aviation Department provide details of the enhanced RAR. This was based on the “known consignor” (KC) concept that under laid the original RAR, but with additional new requirements that will strengthen the documentation trail, in particular for KCs and KC vendors involved in a shipment. Subsequently, implementation meetings were held with the CAD, the Shippers’ Council and HAFFA has been making every effort to ensure the necessary changes cause the minimum disruption to the flow of trade and cargo operations. Hong Kong advanced security screening program – drafting in progress In view of the new screening requirements introduced by the US TSA, HAFFA convened working group meetings with the CAD in order to express industry concerns that these would be impossible to comply with, both in terms of efficiency and quantity, as the current arrangement was established for CTO to mainly cater for the pallet handling and not 100% cargo screening for security purposes. Security screening at the terminal under increased global requirements will prolong the cargo acceptance process for consolidated cargoes, and adversely affect the efficiency of pallet cargo handling. Hence, our gradually diminishing competitive edge will be further undermined. HAFFA is now exploring practical measures to cope with long-term global security requirements, such as providing options for forwarders to screen cargo at their own warehouses. HAFFA, together with relevant Government departments, plans to build upon the various schemes and, with reference to the AEO (Authorized Economic Operators) program, endeavour to establish a Hong Kong advanced security screening program which is achievable and practical. We will keep Members informed should there be any significant updates in this regard.

Cargo Security

Trade Facilitation

II. Liaise with Airport Authority Hong Kong (AAHK) “No Land Link project” and Flat Top Barge Trial Run (Drill Sea Dragon) A drill namely “Sea Dragon” initiated by the Transport & Housing Bureau (THB) and executed by AAHK was held on 26 APR 2010. HAFFA has actively assisted in the flat top barge trial run by alignment of the trucks, pallets and dummy cargoes. It was recorded that the maneuvering time of trucks boarding was around 30 minutes and the barge journey (one-way) took around 2.5 hours. After participating in the drill, HAFFA has compiled a list of comments relating to both aspects of operational and strategic, which were submitted to AAHK for consideration. Below are some highlights: 1/ The drive at SIPCWA (Stonecutters Island Public Cargo Working Area) is quite narrow and it was

wondered if the road capacity can cater for the large quantity of trucks under emergency situation. Need to review the practicality of the landing point location.

2/ Under the drill, each truck involved was given a signage stuck onto the windshield for easy

identification and hence no need for the truck to check-in for verification and then queue up for rolling onto the barge. For real contingency situation, given the limited space at SIPCWA, an appropriate arrangement of check-in & traffic control, queuing up and verification for trucks should be in place to avoid confusion so that the operators could recognize which trucks would get on the barge.

3/ Need AAHK to provide confirmed number of barges and vessels which would be available for

mobilization during emergency situation. 4/ Request for the governmental prior coordination and arrangement with relief airports such as

Shenzhen Airport and Macau Airport.

Drill “Sea Dragon”, 26 APR 2010

III. Liaise with IATA, Carrier Liaison Group (CLG), HACTL and AAT A. Secure Empty Container during Transport to/from Airport – Addition of disclaimer in the

paper ULD Release Form (URF) and future electronic URF We have learnt at the CLG meetings that an accident happened with an empty ULD container dropped from a truck and fell into the sea when the truck passed through Tsing-Ma bridge. The air carriers expressed concerns on the possible liability arising from the incident since the container is owned by carrier. As such, CLG has resolved to develop a disclaimer clause “Disclaimer - Liability for Damage, Injury or Death” for release of empty ULDs. Both Cargo Terminal Operators (Hactl and AAT) have used the ULD release form (URF) with the additional disclaimer starting from 01 February 2011. The URF requires a signature from the recipient of empty ULD (e.g. truck driver). The full text of the additional disclaimer has been circulated to all Members via News. The same has been forwarded to the Hong Kong Association of Aircargo Truckers (HAAT) as well. Members are strongly recommended to consult their own legal adviser so as to understand the legal liability after signing the URF with the additional disclaimer. Should Members have any enquiry regarding the recommended way of ULD tie down on the truck, please contact HAAT at Tel: 2243 2658 (website: http://www.haat.com.hk) for details. B. 24 hours rule for DG storage at the Hong Kong International Airport (HKIA) Members may be aware that it is a legal requirement that no dangerous goods are allowed to be stored in excess of 24 hours inside the Cargo Terminal Operators (CTOs). This regulation is published in the IATA TACT rules. It was however reported at the CLG meetings that airlines had received repetitive alerts from respective CTOs that prolonged storage of import dangerous goods over 24 hours remain unresolved despite efforts made in disseminating the information regarding legal storage limitation to various stakeholders. In general, approximately 30% of the DG shipments remained storage at Hactl over 24 hours and no significant improvement is observed. As such a task force was formed to study measures to tackle the problem. It was initially proposed a mechanism to relocate those DG shipments stored over 24 hours to external licenced DG warehouse at cost. We shall send out essential update to members again when information is available. C. Dangerous Goods Working Group (DGWG) In response to the changes in the 52nd Edition IATA DGR (2011) particularly on the lithium battery, the DGWG finished the BP (Best Practice) reviewing process and the relevant information had been disseminated to Members on 10 DEC 2010 via News and uploaded on the website. The text-version of the Hidden DG Checklist for shippers was issued by CAD on 01 DEC 2010. It was envisaged that the checklist could assist in identifying suspected dangerous goods which in turn would improve the problem of poor goods descriptions. D. Joint HAFFA/CLG Training Program to Cargo Agents Please refer to a separate report under “TRAINING” Date: 12 April 2011

(END OF REPORT)


EXTERNAL AFFAIRS SUB-COMMITTEE Chairman: KERRY FREIGHT (HONG KONG) LTD – Mr. Kenneth Ko Vice Chairman: A-SONIC AIR FREIGHT (H.K.) LTD – Mr. Cliff Sullivan Members: DANZAS AEI (HK) LTD

NAF NORTHERN AIR FREIGHT LTD WANGFOONG TRANSPORTATION LTD WORLDTRANS AIR-SEA SERVICE LTD

The Electronic System for Customs Clearance of Road Cargo – Road Cargo System (ROCARS) 道路貨物資料系統, Mandatory Implementation with effect from 17 NOV 2011 Joint Seminar on ROCARS, 20 JUL 2010 ROCARS was officially launched on 17 MAY 2010. HAFFA, jointly with the Customs, has organized a seminar for HAFFA members on 20 JUL 2010. The objectives of the seminar were to enhance members’ awareness, promote the systems and encourage participants to register as ROCARS users as early as possible so as to overcome any teething problems. Thanks to Members’ enthusiastic support, the seminar was successfully held with a full house of members. Through the seminar, participants shared with the Customs their concerns and difficulties encountered under ROCARS. Technical and operations issues regarding ROCARS Portal During the course of implementation, some technical and operations issues were reported from the ROCARS users. Several meetings between HAFFA and the Customs were convened to address the issues and after lengthy negotiations, Customs have ultimately given positive responses to the issues. Below are some highlights: 1/ Concern 1 Under the ROCARS portal, the shipment information could only be amended by the user who created that particular consignment in ROCARS. However, the company “Responsible Person” and other “Authorized Message Signatories” were not allowed to amend the relevant information. It was in fact inevitable to carry out some last-minutes amendments to shipment details. In case that user who submitted the data via ROCARS was on annual leave or sick leave, the restriction of ROCARS would result in inflexible arrangement of manpower and impractical daily operations. The system should allow e-certificate holders to view and amend the shipment information, not to delete the whole file and resubmit the data. It was believed that e-certificate was the evidence of the actual party to submit in the case which it was found that the cargo description was different from the cargo on board. When C&ED needed to start the investigation of the party submitted the information, e-certificate signature would be sufficient to reveal the truth.

“ROCARS Seminar for HAFFA Members, 20 JUL 2010”

Customs response System amendment timeline to allow e-certificate holders (within the same company) to view/amend any data file being submitted to ROCARS is not known yet. However Customs would set this as a priority and trust that it should be done before the mandatory implementation date 17 NOV 2011. 2/ Concern 2 HAFFA brought out the issue of frontline Customs officer requesting forwarder to provide (actual) shipper’s information in ROCARS data submission. As forwarders may authorize truckers to submit ROCARS on their behalf, it would be inappropriate and unnecessary to disclose the actual shipper’s information to truckers, which in fact has deviated from the existing industrial practice. Customs Response After internal discussion, it is confirmed the principle of submitting the information via paper and via electronic means are the same and forwarder can submit his company name as before. Thus the case is resolved. 3/ Concern 3 Drivers should not be allowed to do “unbundling” work without prior consent of shipper / forwarder. Customs response In view of the various possibilities that causing the driver not following user’s instruction, user should allow only the trucking company staff (not the trucker) to do bundling/unbundling work. In case of urgency, user could consider resubmitting the data to get a new CCRN number and instruct another trucker to do the job. 4/ Concern 4 Personal ID and Residential Address should not be displayed in the ROCARS system. Customs response The Customs has amended the system accordingly. The HKID and residential address are no longer on display after the user logins the ROCARS account. Publicity and One-Stop Customs Outreach Services To enhance the Announcement of Public Interests for ROCARS, the Customs have made arrangement with the Shenzhen Traffic Radio (深圳交通頻率FM106.2) to broadcast ROCARS publicity audio which can be listened from the hyperlink below: http://www.szr.com.cn/szmg_broadcast/index.do?a=fm1062. They have also produced a 30-second ROCARS publicity video which can be viewed from: https://www.rocars.gov.hk/tc/Doc/rocars_publicity_tc.wmv. More manpower was allocated by the Customs to assist truck drivers to register with ROCARS at the cross boundary. Besides, the Customs outreach team has provided a better service to ROCARS applicants by allowing Applicant Company to first submit all required information to Customs and then the outreach team will be going on-site to process the applications (i.e. distributing the ROCARS approval package and teaching simple ROCARS operational procedures) and provide guidance on cargo data submission. This one-stop Customs outreach services can avoid the hassle for the applicant to go to the Post Office in person for the registration formalities.

“The Customs officials paid a visit to HAFFA on 18 JUN 2010 to discuss how to encourage industry for early registration.”

Appeal For better preparation of mandatory implementation of ROCARS with effect from 17 NOV 2011, we would like to appeal to Members who are engaged in importing / exporting road cargoes for registering and using the ROCARS system as early as possible so as to overcome any teething problems. For those Members who plan to outsource the relevant jobs, please ensure your sub-contractor(s) would duly perform ROCARS submission on your behalf in order to comply with the ordinance. Detailed registration procedures including registration form and the subsequent formalities can be obtained by clicking into the ROCARS website: https://www.rocars.gov.hk/rs-portal/regIndex.do?locale=en_US. For enquiry, please send an email at [email protected] or dial hotline: 3669 0000.

Date: 12 April 2011

(END OF REPORT)


FAPAA LIAISON SUB-COMMITTEE Chairman: CARGO FREIGHT SERVICES LTD – Mr. Danny Wong Vice Chairman: THE JANEL GROUP OF HONG KONG LTD – Ir. Dr. Paul Tsui Member: ALPHA LOGISTICS (HK) LTD The FAPAA 37th Executive Council Meeting (ECM) was hosted on Sentosa Island Singapore between 03 to 05 June 2010. Air cargo security was still at the top of the business agenda this year. The issue of 100% screening has been contentious amongst the FAPAA members due to the vague identification of guidelines and definition of what can be classed as 100% ‘screening’. According to the subsequent general response from the USA Transportation Security Administration (TSA), ‘screening’ meant intervention of cargo by electronic or manual means rather than with a paper trail or historical movement screening. Another issue raised was the inability of carriers to share certain security sensitive information with the forwarders even though it was the forwarders that provide the documentation and cargo which had to meet various TSA security requirements.

In the security forum of FAPAA meeting, invited by the late Walther Nahr (Moderator of the Forum and FAPAA Vice Chairman), Martin Eran Tasker of AAPA (Association of Asia Pacific Airlines) delivered a presentation on the opportunities for cooperation and progress. He invited FAPAA to join the AAPA working group in addition to currently being involved in the Security working group, an offer which was immediately accepted, further strengthening the new bond between the two representative bodies in the Asia

Pacific. Eran Tasker indicated that it was important for the Asia Pacific to have a unified voice in light of the wider impact of US and EU regulations on the Freight Industry; this being a view also held by FAPAA. He also mentioned that AAPA was concerned with the lack of harmonisation resulting in inconsistency of terms, definitions and national requirements and processes throughout the Asia Pacific. Security Advisor of FAPAA, Mr. David Fielder, based on his role within FIATA (Chairman of FIATA Advisory Body on Security Matters), presented news from the ICAO Secretariat Study group on

Supply Chain Security and the review of the Amendment 12 to Annex 17 for the clarification of terms and concepts. It was confirmed in the meeting that FAPAA and AAPA will continue to work together and the goal is to work with the regions leading regulators for mutual recognition and harmonisation of regional and global security measures. The next FAPAA ECM will be held in Dhaka, Bangladesh on 11-13 June 2011.

“The 37th Executive Council Meeting of FAPAA, Singapore, 03-05 June 2010”

Date: 12 April 2011

(END OF REPORT)


FIATA LIAISON SUB-COMMITTEE Chairman: CARGO FREIGHT SERVICES LTD – Mr. Danny Wong Vice Chairman: THE JANEL GROUP OF HONG KONG LTD – Ir. Dr. Paul Tsui Members: ALPHA LOGISTICS (HK) LTD Report on the FIATA World Congress, 04 - 08 OCT 2010 in Bangkok, Thailand 1. IATA Accreditation Processes

Partnership between FIATA and IATA will be working in the area of accreditation. Principles lay down for some time, which as a consequence of an event has seen particularly going through an unrivalled and unparalleled year of 2009, where the global recession took so much out of so many businesses, for airlines, for the FIATA members and also for the forwarders customers and every other industry. IATA needs to take a look at some of the accreditation processes, to see if most of those resolutions need to be updated. In appreciating what all the forwarders have done for past decades, which is working with a complete

discipline and ensuring that IATA has been able to achieve approx. 99.97% success in protecting its member’s cash, which demonstrates that from a risk-management perspective the forwarders have done a very good job. Some of the pains that some of forwarder members felt around the world as IATA adopted a more rigid zero tolerance compliance of existing resolutions, comes because of the concern that some of IATA members have, particularly the CFO’s, about what are the risk that are out there. Now, IATA and FIATA are working in partnership. IATA endeavored to ensure that where IATA has people with less cargo experience, trying to apply Standard Operating Procedures which they believe are in keeping with the resolutions, is to take a look at these SOPs and ensure that IATA takes into account the environment in which we trade. 2. Air Cargo Backlogs FIATA referred to backlogs of 90 tons in LAX for Australia and 50 tons in HKG and SIN. IATA was urged to call its members to put more aircrafts back to service. IATA responded that the airlines had to suffer financially and why they had to reduce a bit of capacity during the recession. This is possibly why that capacity is slow to be brought back. The airlines made tremendous cuts in human resources as much as anything else. There is a shortage of pilots. Airlines are finding themselves at the moment with increasing demand would like to bring back the capacity but they do not have the skilled resources. Whether this is pilots and technical crew is also a challenge for them. But airlines want to ensure that they can preserve the yield and the financial operating profitability, before they will risk the introduction of greater capacity.

3. E-Freight IATA considers technology as a very important tool that will and should drive the benefits for all. It sees projects such as e-freight and the e-airwaybill as just the fundamentals of business, not because the passenger opposites has gone and developed e-ticketing. Eliminating the huge trail of paper and that process of paper is a given. It is needed to ensure that the accuracy of information, the transmitting of status-updates etc.

FIATA and HAFFA reflected that e-freight had not been taken up very well. Representative from Australia expressed that it was profoundly discussed in Australia they believe IATA should consider mandating e-freight. To set a date and to make it mandatory requirement, that everybody has to do it. They believe in reducing the amount of documentation and that all needed is the Master, the House Airwaybill and the Manifest information. Just about every forwarder in Australia reports this electronically now. But 99% will not report as an E-freight shipment due to the other requirements. Forwarders still send document pouches which are even though not necessary.

IATA responded that the question of bringing a mandate was also thought by its members, within the Cargo Committee. In December of last year the Board of IATA mandated that IATA should pursue an e-freight 100 percent mandate for 2015. This was to be ratified at the June IATA AGM. Part of the reason why it failed to come forward is because IATA wanted to make sure that when somebody talks about a mandate, they need to talk with their partners and try to ensure that such mandate is deliverable. The one difference between e-freight and e-ticketing is that when e-ticketing was embarked by IATA, it was already a running programme; several airlines already had an e-ticketing mechanism in place. This particular programme was just adopted and followed by the rest of the industry. E-freight is something that has been developed from the very first base. There was no programme running before hand and there is far more constrictions on stakeholders in the current process. Trying to bring on board all the various elements, particularly the IT-platform and constrictions like Customs and the various behaviors where there is not a harmonized process has made it somewhat incredibly difficult to try and achieve. So what people sometimes are critical is the level of scalability. But what has been developed in the five years is the fact that IATA has at the moment not far short off seventy percent of the worlds trading lanes almost e-enabled and capable. IATA would love to see mandate, but it would be more important to see it collectively supported by the industry. A member of FIATA considered that there is nobody that can make e-freight mandatory. It is to get the real evidence that the interest for all stakeholders will be to adhere to will make it happen. The stakeholders must see that their interest is taken into account. When it has to be confirmed FIATA - AFI (Airfreight Institute) is definitely in favour of e-freight. Presently a great percentage of forwarders are capable to do it as of tomorrow. Unfortunately we found that a number of airlines are not. Date: 12 April 2011

(END OF REPORT)


GREATER CHINA AFFAIRS SUB-COMMITTEE Chairman: WANGFOONG TRANSPORTATION LTD – Mr. Louis Lee Vice Chairman: BEL INTERNATIONAL LOGISTICS LIMITED – Mr. Brian Wu Members: CARGO FREIGHT SERVICES LTD

DHL GLOBAL FORWARDING (HONG KONG) LTD MORRISON EXPRESS CO LTD U-FREIGHT LTD AE CARGO SERVICES LTD

Greater China Affairs Sub-Committee plays a very active role in liaison with the government bureau, trade organizations as well as industry counterparts in the Greater China. Last year, the sub-committee, representing HAFFA, met with many officials, associations and industrial players from different provinces to network and exchange valuable business intelligence and experience on the logistics practices.

Joint Delegation to Guangxi, 10-12 JAN 2011 Due to the less expensive labor cost, a lot of production bases have been relocated from Pearl River Delta Area to Hanoi or Haiphong of Vietnam despite the fact that majority of materials and parts vendors are still located in PRD. As a result, a supply chain demand is created between productions plants in Vietnam and their material vendors in China. Due to the high costs of air cargo and slow movement by sea, express trucking service has developed to meet the logistics need and more cargo trade is flourished under the zero import tariffs adopted between China and ASEAN countries recently.

To provide opportunities for gaining a better understanding on the China-Vietnam border port facilities and how cargo could be cleared at the Youyi Guan (友誼關), the second largest border control point in Asia second to HuangGuang (皇崗口岸). HAFFA, jointly with the Hong Kong Shippers’ Council organized a delegation to Guangxi during the period of 10-12 January 2011.

In this 3 days 2 nights trip, the delegation, led by Mr. Louis Lee (HAFFA Vice Chairman and Greater China Affairs Sub-committee Chairman), visited a logistics company and various logistics facilities located in Guangxi including China-ASEAN Logistics Park (東盟物流園), China-Vietnam Youyi Customs (中越友誼關口岸), Youyi Customs Inspection Facilities (友誼關海

關核放區設施), Puzhai Customs (浦寨口岸)

and Longyao Customs (弄堯口岸) as well as met with officials of Nanning Commerce Bureau (南寧市商

務局) and Pingxiang Commerce Bureau (憑祥市商務局). The delegation can build a platform for promoting exchanges among logistics players of both sides and the participants can better assess the business opportunities in Guangxi throughout the trip.

The feedback received from delegates was positive and encouraging. Interested Members are welcome to suggest any Mainland destination for the HAFFA Delegation to China in Year 2011 - 2012 and we appeal for your continuous support in joining the study tour again. Transport Constituency Delegation to Beijing, 15-18 SEP 2010 A high-level Hong Kong Transport Constituency Delegation to Beijing led by Ms. Miriam Lau / Legislative Councilor was held on 15-18 SEP 2010. The delegation was initiated by the Election Committee of Transport Constituency and has visited many authorities of the Chinese Central Government such as the Chinese Customs (中國海關總署), National Development Reform Commission (中國國家發展和改革委

員會), Hong Kong and Macao Affairs Office State Council (國務院港澳事務辦公室), United Front Work Department of CPC Central Committee (統戰部) etc. Representing HAFFA, the Chairman Ir. Dr. Paul Tsui and Vice Chairman Mr. Tom Li have joined the delegation and reflected HAFFA views on the Hong Kong logistics development to the Central Government. Highlights of HAFFA views include: a/ Views presented to Chinese Customs (中國海關總署) At present, the Mainland and Hong Kong Customs authorities require separate processes of customs declaration submissions and thus the contents and formats of declarations were different. Even under the new ROCARS platform, the data format was different from the China Customs’ declaration format. The Chinese Customs was suggested establishing a neutral and secure IT web-based platform with an aligned format to submit the declarations electronically to both ROCARS and the China Customs’ H2000 system

simultaneously. It was noted that both Government Agencies intended to go for the same direction and the Chinese Customs was enquired of the targeted schedule of roll-out.

ii/ Views presented to Chinese Customs and Hong Kong and Macao Affairs Office of the State

Council (中國海關總署和國務院港澳事務辦公室) To establish the mechanism of “Co-location Customs Clearance” (一地兩檢) at a bonded area in Hong Kong in which Hong Kong freight forwarding and logistics companies can perform customs clearance for all import cargoes for both Customs. After applying Customs’ e-seal, the customs cleared cargoes can be distributed to customers in the Mainland via the green lane. iii/ Views presented to National Development and Reform Commission (中國國家發展和改革委員會) The Commission was enquired that how Hong Kong can better leverage its unique advantages and functions during the National 12th Five-Year Plan period. How can Hong Kong be positioned as inventory management centre and regional distribution hub for high-value goods. Extract of the HAFFA views, meeting notes containing all views of the delegation and subsequent written response from the Guangdong Customs were circulated to all Members via News on 28 OCT 2010.

“Transport Constituency Delegation to Beijing, 15-18 Sep 2010”

Meeting and Luncheon with MAFFA Delegation, 10 MAR 2011 An 8-person delegation led by Mr. Edward Lee, Chairman of MAFFA (Macau Air Freight Forwarding (Logistics) Association paid HAFFA a courtesy visit on 10 MAR 2011. In the meeting, HAFFA was provided with an update on the latest development of new logistics facilities area in Macau and explore the possibility for closer collaboration. Both parties also exchanged views and information on the ECFA impact, regulation of China Customs and industry outlook of Hong Kong/Macau.

Taking this opportunity, Mr. Louis Lee would like to convey his gratitude and appreciation to all the sub-committee members and the secretariat that have devoted much time and efforts to participate in the functions of the Greater China Affairs. Key activities in 2010-2011 at a glance:

Date Event Organizer(s) / Visitor(s) 1 11/05/2010 山東-香港經貿合作交流午宴

- Update on the latest logistics development in Shandong and-Hong Kong. - Explore the cooperation opportunity between two places.

Hong Kong Trade Development Council (HKTDC) 香港貿易發展局

2 13/07/2010 2010 海南(香港)現代服務業投資推介會暨海南

省政府招待晚宴 - Networking and major contracts signing ceremony

The People’s Government of Hainan Province 海南省人民政府

3 14/07/2010 2010 海南香港現代物流業合作圓桌會 - Briefing on the latest development of modern logistics industry in Hainan and explore investment & cooperation opportunity under CEPA and ASEAN in particular.

Commercial Department of Hainan Province 海南省商務廳

4 10/08/2010 2010 江蘇鹽城(香港)現代物流投資環境推介會

及答謝晚宴 - Update on the latest development of Yancheng logistics services and explore the possibility of cooperation and investment.

Yancheng Municipal Government江蘇省鹽城市人民政府

5 06-07/09/2010 Conference and CIFA’s 10th anniversary in Tianjin 兩岸物流產業合作及交流會議 - Networking and celebrate CIFA’s 10th anniversary.

China International Freight Forwarders Association (CIFA) 中國國際貨運代理協會

Date Event Organizer(s) / Visitor(s) 6 15-18/09/2010 Transport Constituency Delegation to Beijing

航運交通界訪京團 - High level transport constituency delegation to Beijing led by Ms. Miriam Lau / Legislative Councilor - Communicate with the Central Government and discussion on various issues including co-location customs clearance, CEPA etc with an aim to enhance Hong Kong Competitiveness in logistics & transport industry.

Election Committee of Transport Constituency 航運交通界選舉委員會委員

7 26-29/09/2010 Sino-International Freight Forwarders Conference 第七屆中外貨代物流企業洽談會 - One-on-one meetings - Explore business opportunities with companies from more than 100 different countries / regions

China International Freight Forwarders Association (CIFA) 中國國際貨運代理協會 and WCA Family of Logistic Networks

8 25/10/2010 Networking Lunch with Fujian Logistics Mission 福建省物流代表團交流午宴 - Networking and explore possibility for further collaboration.


9 16/12/2010 粵港物流合作洽談會及交流午宴 - Discussion on the trend of e-Logistics Development in Guangdong and Hong Kong under CEPA..


10 22/12/2010 深圳市交通運輸委香港物流專題赴港交流考

察團 - Ir. Dr. Paul Tsui (HAFFA Chairman) as guest speaker.

(Topic: 香港物流業和第三方物流的現狀與未來)

Transport Commission of ShenzhenMunicipality 深圳市交通運輸委員

會 and Hong Kong Financial Services Institute香港金融管理學院

11 10-12/01/2011 HAFFA / HKSC Joint Delegation to Guangxi廣西考察團 - Better understand the China-Vietnam border port facilities and how cargo could be cleared at the Youyi Guan (友誼

關), the second largest border control point in Asia second to HuangGuang (皇崗).

HAFFA & The Hong Kong Shippers’Council (HKSC) 香港付貨人委員會

12 25/02/2011 Spring Dinner hosted by the Shenzhen Communication and Transport Commission - Networking and communicate with the representatives from Shenzhen’s Aviation, Shipping & Logistics Industry.

Transport Commission of ShenzhenMunicipality (Ports Administration of Shenzhen Municipality) 深圳市人民

政府交通運輸委員會(港務管理

局) 13 10/03/2011 Meeting and Luncheon with MAFFA

Delegation - Update on the latest development of new logistics facilities area in Macau and explore the possibility of cooperation - Discussion on ECFA impact & regulation of China Customs

Macau Air Freight Forwarding (Logistics) Association 澳門空運暨物流業協會

Date: 12 April 2011

(END OF REPORT)


INFORMATION TECHNOLOGY SUB-COMMITTEE Chairman: WORLDTRANS AIR-SEA SERVICE LTD – Mr. Samson Choi Vice Chairman: ALPHA LOGISTICS (HK) LTD – Mr. Paul Cheung Member: BEL INTERNATIONAL LOGISTICS LTD

DHL GLOBAL FORWARDING (HONG KONG) LTD Innovation and Technology Fund (ITF) Project: Enhancing the Competitiveness of the Hong Kong Air Freight Forwarding Industry Using RFID and Software Agent Technologies Working in collaboration with Hong Kong R&D Centre for Logistics and Supply Chain Management Enabling Technologies, HAFFA, DHL Global Forwarding (HK) Limited and other industrial collaborators, together with PolyU’s Department of Computing kicked off an ITF project entitled “Enhancing the Competitiveness of the Hong Kong Air Freight Forwarding Industry using Radio Frequency Identification (RFID) and Software Agent Technologies” in 2008. The project aimed to investigate the use of RFID and software agent technologies to enhance the competitiveness of Hong Kong’s air freight forwarding industry.

Subsequent to the update in our last Annual Report, computing experts of PolyU have successfully developed an Air Cargo Processing System using RFID technology. The system involves the innovative and effective use of RFID to facilitate air cargo processing, which helps Hong Kong to maintain its leading role in air freight forwarding industry. A project briefing was held on 20 JUL 2010 with distinguished speakers from industry. In the briefing, the team presented the project updates and gave a video demonstration to participants of the industry. With the support of DHL Global

Forwarding (HK) Limited, the project team completed a pilot run for delivering the first batch of air cargo from Hong Kong to Taiwan using the RFID system. Once the air cargo items were received in Taiwan, the air cargo information was decoded and updated accordingly. The pilot run provides valuable reference for the Hong Kong air freight forwarding industry.

2011 marks the 100th anniversary of the aviation development in Hong Kong. Riding on this special occasion, another seminar called “Hong Kong Air Cargo Exchange (HKACE) 2011” was held on 28 FEB 2011, the objective was to present the result of the project as well as provide a forum for academic and industry people to exchange experience, views and visions on the air cargo industry. In the seminar, Ir. Dr. Paul Tsui, HAFFA Chairman was one of the guest speakers to deliver a welcome address and a speech entitled “Global Security Compliance – Way Forward for Hong Kong”. Through the presentation, the Chairman pointed out the trend of rapidly growing demand for increased global air cargo security and shared views on security compliance for Hong Kong. The project is successfully completed. For more details, please visit: http://www.comp.polyu.edu.hk/~airfreight.

“Hong Kong Air Cargo Exchange (HKACE) 2011, 28 DEC 2011” Date: 12 April 2011

(END OF REPORT)


LEGAL MATTERS SUB-COMMITTEE Chairman: AGILITY LOGISTICS LTD – Mr. Y. K. Mok Vice Chairman: BEL INTERNATIONAL LOGISTICS LTD – Mr. Brian Wu Members: DHL GLOBAL FORWARDING (HONG KONG) LTD

THE JANEL GROUP OF HONG KONG LTD AE CARGO SERVICES LTD

HAFFA Views on Competition Bill 競爭條例草案 The Competition Bill was promulgated in June 2010. In view of the fact that the future law may have significant impact on the operations of the Association, HAFFA has paid much attention to the details of the legislation. In response to the last Government consultation, HAFFA sent a letter prepared by Legal Adviser Mr. Daniel Lam to the Commerce and Economic Development Bureau (CEDB) back in August 2008 with a view to clarifying some concerns arising from the proposed law. Except an acknowledgment letter, no official feedback to the enquiries was received from the CEDB since then. Given the introduction of Competition Bill, a working group was set up to review the bill and formulate HAFFA views which have been submitted to Bills Committee and Ms. Miriam Lau, Legislative Councilor on 18 NOV 2010. Highlights of HAFFA views include the following: 1. To seek Government’s clarification on

HAFFA letter submitted in August 2008, following the consultation on Competition Policy.

2. According to the Bill, it is a statutory

requirement for the Competition Commission to draw up regulatory guidelines on the interpretation of the conduct rules and implementation of block exemption in consultation with persons as it considers appropriate. As HAFFA needs to evaluate whether its various activities have infringed the law or which activities should be applied for block exemption, it is important for us to know when the above consultation will be carry out and when the regulatory guidelines will be available. We therefore requested to take part in the said consultation to provide industrial input.

“HAFFA Letter to CEDB dated 21 AUG 2008”

3. In accordance with the second conduct rule under the Bill, an undertaking that has a “substantial degree of market power” in a market must not abuse that power by engaging in conduct that has as its object or effect the prevention, restriction or distortion of competition in Hong Kong. We sought Government’s clarification on how to define market and requested the authority to issue regulatory guidelines on how to quantify “substantial degree of market power” and “abuse that power”.

4. To urge the Government to allow a reasonable transitional period for the implementation of the

Competition Law so as to facilitate the industry adapting to the statutory requirement. 5. To seek Government’s clarification as to which party will be responsible for the following actions

under the institutional framework. a/ receipt of complaints;

b/ conducting investigation; c/ bringing proceedings to the Tribunal; and d/ adjudicating the cases

We reflected that there is a need for check and balance to ensure that the Competition Authority powers are not abused.

6. To seek Government’s clarification on which party should bear the burden of proof, plaintiff or

defendant under the proceedings.

Date: 12 April 2011

(END OF REPORT)

“HAFFA Views to Bills Committee & Ms. Miriam Lau dated 18 NOV 2010”


MEMBERSHIP SUB-COMMITTEE Chairman: BEL INTERNATIONAL LOGISTICS LTD – Mr. Brian Wu Vice Chairman: GRAND EXPRESS LTD – Mr. Kenneth Chow Member: ALPHA LOGISTICS (HK) LTD DHL GLOBAL FORWARDING (HONG KONG) LTD UTI (HK) LTD WANGFOONG TRANSPORTATION LTD WORLDTRANS AIR-SEA SERVICE LTD A. Membership HAFFA have admitted total 16 New Ordinary Members and 1 New Associate Member during the year of 2010-2011, their names are listed below: Ordinary Member 1. CN Logistics Ltd 9. Leader Ocean International (HK) Ltd 2. DT Logistics (HK) Ltd 10. Orient Express Container (HK) Company Ltd3. Global Cargo International Ltd 11. RAS International Ltd 4. HTNS Hong Kong Company Ltd 12. Sky One International Freight Ltd 5. Jetford Logistics Ltd 13. Skymax Consolidation Ltd 6. Jupiter Logistics Company Ltd 14. Top Logistics (HK) Ltd 7. Kesco Logistics Ltd 15. TSR Logistics (HK) Ltd 8. Kintex Transportation Company Ltd 16. YCH Logistics (HK) Ltd

Associate Member 1. Freight Transportation Company Ltd

During the year of 2010-2011 the following members ceased to be a member of HAFFA: 1. ACI Logistics (Far East) Ltd 8. Snatt Asia Ltd 2. ASL International Ltd 9. Sun Link Logistics Co Ltd 3. Dart Express (HK) Ltd 10. Vanuatu Freight Forwarding (H.K.) Ltd 4. Merchandise Worldwide Transportation Ltd 11. W.T. Sea Air Asia Ltd 5. NYK Logistics (HK) Ltd 12. Wings Logistics (HK) Ltd 6. Reynold Van Lines Ltd 13. YRC Logistics China (HK) Ltd 7. Santa Fe Transport International Ltd

And the total membership now stands at 346. B. FIATA Licencee In addition we have authorized the following members to issue the FIATA Documents [including FIATA Multimodal Transport Bill of Lading (FBL) “as Carrier”, FIATA Multimodal Transport Waybill (FWB) & Forwarders Certificate of Receipt (FCR)] in Hong Kong: 1. DT Logistics (HK) Ltd (088) 2. Global Cargo International Ltd (026) During the year of 2010-2011 the following members ceased to be FIATA Licencee: 1. Reynold Van Lines Ltd (044) 2. W.T. Sea Air Asia Ltd (033) The total number of members authorized to issue FIATA Documents now stands at 80. Date: 12 April 2011 (END OF REPORT)


POLICY SUB-COMMITTEE Chairman: DHL GLOBAL FORWARDING (HONG KONG) LTD – Mr. Tom Li Vice Chairman: AGILITY LOGISTICS LTD – Mr. Y. K. Mok Members: CARGO FREIGHT SERVICES LTD

MORRISON EXPRESS CO LTD NAF NORTHERN AIR FREIGHT LTD THE JANEL GROUP OF HONG KONG LTD WANGFOONG TRANSPORTATION LTD

Joint Proposal with CILTHK (The Chartered Institute of Logistics and Transport in Hong Kong) to the Financial Secretary of HKSARG Following the CILTHK / HAFFA joint letters submitted to the HKSAR Government on 08 October 2009 and 22 December 2009 respectively, taking the opportunity of the financial budget 2011 public consultation, CILTHK and HAFFA joined hands again to submit another proposal outlining a number of recommendations with a view to strengthening Hong Kong’s position as a leading regional logistics hub. The recommendations, amongst others, include introduction of a transshipment ordinance, mutual recognition of security compliance, provision of centralized screening facilities at airport and establishment of a common IT platform for joint submissions to two Customs Authorities. Transport and Housing Bureau (THB) sent its official response subsequently but the overall response was “not so positive” in general. HAFFA has categorized different issues under different Government bureaux/authority/department and will follow-up the matters with them respectively. The 3rd Runway HAFFA echoed the sentiments of the Airport Authority Hong Kong (AAHK) that we must ensure our airport is able to cope with air traffic growth. According to a recent report, the airport’s two existing runways are expected to reach full capacity by 2017. It is estimated that the construction of a new runway will normally take almost 10 years meaning that if development were to commence in 2011, the airport would still be operating at maximum capacity from 2017 to 2021. We foresee that shipments which cannot be transshipped via Hong Kong will be directed to other competing airports, most likely never return here. We have discussed this issue with the senior management of the AAHK, and will work with the Shippers’ Council to continue to urge the SAR Government to expedite the construction of the third runway.

Construction of Airfreight CFS Warehouse Facilities at HKIA HAFFA has proposed to the THB, Commerce & Economic Development Bureau (CEDB) and AAHK to build a centralized screening CFS facility at the airport for the industry, in particular for the SMEs. In view of the rapidly-growing demand for international air cargo security, the facility should be equipped with centralized scanning machines to enhance its capacities and maintain our competitiveness in the consolidation business. It is vital to have this facility in place and financed by the Government, particularly as it will assist SMEs forwarders to overcome financial difficulties associated with screening at their limited facilities, as well as improving lead time and overall costing. We requested for a reasonable rental rate & long term (or even permanent) contract in order to stabilize our costing as rental is the major cost in our industry. Date: 12 April 2011

(END OF REPORT)


PUBLIC RELATIONS SUB-COMMITTEE Chairman: THE JANEL GROUP OF HONG KONG LTD – Ir. Dr. Paul Tsui Vice Chairman: DHL GLOBAL FORWARDING (HONG KONG) LTD – Mr. Tom Li Members: A-SONIC AIR FREIGHT (H.K.) LTD

WANGFOONG TRANSPORTATION LTD

I) Key Events with Various Trade Bodies

Date HAFFA Event Organizer(s) / Visitor(s)17/05/2010 Mr. Louis Lee

(Vice Chairman) Launching Ceremony of the Road Cargo System (ROCARS)

Customs and Excise Department

20/05/2010 Mr. Louis Lee (Vice Chairman)

Celebration Party for the successful implementation of ROCARS


03-05/06/2010 The late Mr. Walther Nahr (HAFFA Representative) and Ms. Alice Lui (HAFFA Secretariat) as conference delegates

The 37th FAPAA Executive Meeting and 25th year Anniversary of the Singapore Aircargo Agents Association (SAAA), Singapore

FAPAA (please refer to the Annual Report under FAPAA Sub-committee)

17/07/2010 Ir. Dr. Paul Tsui (Chairman) as guest speaker (Topic: Strategic Direction of Air Freight Development in Hong Kong)

Seminar: Development of Hong Kong Air Freight

The Hong Kong Federation of Trade Unions (HKFTU) Logistics and Transport Industry Committee

20/07/2010 Ir. Dr. Paul Tsui (Chairman)

Media Reception: Innovation and Technology Fund (ITF) sponsored project “Enhancing the Competitiveness of the HK Air Freight Forwarding Industry Using RFID and Software Agent Technologies”

The Hong Kong Polytechnic University (PolyU)

06/08/2010 Ir. Dr. Paul Tsui (Chairman) and Mr. Brian Wu (Executive Committee)

Introduction to Project “London Gateway” & exchange of industrial information

London Gateway, DP World

22/08/2010 Mr. Brian Wu (Executive Committee & Recreation & Sports Sub-committee) as award presenter

HAFFA Bowling Tournament 2010

HAFFA

01/09/2010 Mr. Tom Li (Vice Chairman) as welcome note speaker

Seminar: “Kaunas airport – emerging air cargo hub for North East Europe, advantages and opportunities”

Lithuanian Commercial Attaché in China, Kaunas Int’l Airport & JSC “Hoptrans Logistic” in cooperation with HAFFA, HKTDC & Indian Chamber of Commerce in Hong Kong

Date HAFFA Event Organizer(s) / Visitor(s)09/09/2010 Ir. Dr. Paul Tsui

(Chairman) Roundtable: “Holland - Connecting Global Airport/ Seaports Hubs”

Consulate General of the Netherlands and Hong Kong Logistics Development Council (LOGSCOUNCIL)

10/09/2010 Mr. Edwin Tsang (Airfreight Sub-committee Chairman)

Exchange of views on e-freight implementation

Dutch Government Trade Mission and IATA

30/09/2010 Mr. K. K. Lai (Logistics Sub-committee Chairman) as guest speaker (Topic: Wine Logistics Business Opportunities)

Seminar: “Be In Sync and Penetrate the Cold Chain and Wine Logistics Business”

Hong Kong Trade and Development Council (HKTDC)

04-08/10/2010 The late Mr. Walther Nahr and Mr. David Fielder (HAFFA Representatives) as conference delegates

FIATA World Congress 2010, Bangkok, Thailand

FIATA (please refer to the Annual Report under FIATA Sub-committee)

15/10/2010 Mr. Tom Li (Vice Chairman)

Passing-out Parade for cadets of No. 90 to 92 Inspector Induction Course



Opening Ceremony-cum-Reception of the Maritime Awareness Week 2010 (MAW)

HK Maritime Industry Council

27/10/2010 HAFFA as co-organizer Briefing & Consultation Session: Proposed e-House Bill of Lading Submission Scheme “e-Sea Customs Clearance for Inbound Cargo” (e-SCC-IN)


04/11/2010 Ir. Dr. Paul Tsui (Chairman) and Members of the Seafreight Sub-committee

Exchange of industrial information

Port of Le Havre, France

05/11/2010 HAFFA as supporting organization Ir. Paul Tsui (Chairman & Ms. Alice Lui (HAFFA Secretariat) as delegate

GS1 Hong Kong SCM (Supply Chain Management) Excellence Summit 2010

GS1 Hong Kong

12/11/2010 Mr. Cliff Sullivan (Vice Chairman)

PolyU - The 16th Congregation (Faculty of Business)



Networking Luncheon with a 13-member delegation led by the Deputy Director General of Thai Customs

Hong Kong Logistics Development Council (LOGSCOUNCIL)

22/11/2010 Mr. Kenneth Chu (Seafreight Sub-committee Chairman) as guest speaker (Topic: Local Services Requirement – Forwarders’ Perspective)

Joint Seminar: “European Union’s 24 hour advanced Manifest Regulation”

The Hong Kong Shippers’ Council (HKSC), Hong Kong Liner Shipping Association (HKLSA) & HAFFA (please refer to the Annual Report under Seafreight Sub-committee)

Date HAFFA Event Organizer(s) / Visitor(s)28/12/2010 Ir. Dr. Paul Tsui

(Chairman) Celebration Ceremony for HKIA Setting New Traffic Records: 50M Passengers and 4M Tonnes of Cargo

Airport Authority Hong Kong (AAHK)


Exchange of industrial information

U.S. Consulate General Hong Kong and U.S. Bureau of Industry and Security

09/01/2011 Mr. James Chan (Airfreight Sub-committee Chairman) as judge

The 2011 International Forklift and Pallet Building Competition

Hactl


Poly U - University Fellowship Conferment Ceremony 2010-2011



Networking Luncheon: Aviation Cooperation between Hong Kong & EU

European Chamber of Commerce

20/01/2011 Ir. Dr. Paul Tsui (Chairman) and Members of Airfreight Sub-committee

Exchange of views on e-AWB global implementation

IATA e-AWB airlines working group


Official Opening of the Customs Headquarters Building


28/02/2011 HAFFA as one of the co-organizers Ir. Dr. Paul Tsui (Chairman) as welcome note speaker and guest speaker (Topic: Global Security Compliance – Way Forward for HK)

Seminar: Hong Kong Air Cargo Exchange (HKACE) 2011

The Hong Kong Polytechnic University (PolyU) (please refer to the Annual Report under IT Sub-committee)

01/03/2011 Mr. Raymond Chan (Policy Sub-committee)

Exchange of information on export control in Hong Kong

Jane’s Information Group (Consultancy)

08-10/03/2011 HAFFA as endorser and exhibitor

Air Freight Asia 2011 Conference

Conference managed by Reed Exhibitions

22/03/2011 HAFFA as one of the supporting organizers Ms. Alice Lui (HAFFA Secretariat) as conference delegate

LSCM (Logistics and Supply Chain Management) Annual Conference 2011

Hong Kong R&D Centre for Logistics and Supply Chain Management Enabling Technologies (LSCM R&D Centre)

II) Greater China Affairs Delegations / Events Please refer to a separate report under “GREATER CHINA AFFAIRS SUB-COMMITTEE”. III) Media and Others Throughout the year 2010-2011, HAFFA was interviewed by the media on various issues. With the help of the executive committee members, the PR Sub-committee endeavor to entertain almost all press enquiries. In making comments, we adopt a factual, objective approach with the interest of HAFFA members being our first priority. Date: 12 April 2011 (END OF REPORT)


SEAFREIGHT SUB-COMMITTEE Chairman: MORRISON EXPRESS CO LTD – Mr. Kenneth Chu Vice Chairman: AGILITY LOGISTICS LTD – Mr. Y. K. Mok Members: ALPHA LOGISTICS (HK) LTD

BEL INTERNATIONAL LOGISTICS LTD DHL GLOBAL FORWARDING (HONG KONG) LTD

Seminar on EU’s 24-hour Advanced Manifest Regulation, 22 NOV 2010 Sponsored by Hong Kong Logistics Development Council (LOGSCOUNCIL), HAFFA, the Hong Kong Shippers’ Council (HKSC) and Hong Kong Liner Shipping Association (HKLSA) jointly organized a seminar on EU’s 24-hour Advanced Manifest Regulation on 22 NOV 2010. The regulation has come into effect on midnight of the 31 DEC 2010. However, very limited information of what appropriate changes to the documentation process from shipping lines in Hong Kong in order to comply with EU customs’ new requirements was available. With reference to previous experience of implementing similar rule in the US, it was envisioned that the same process would be long and arduous. Things get even worse, unlike US AMS for which the US Authority and Hong Kong Customs have organized several seminars for Hong Kong shipping community, there was no similar event held by EU Authority. It was foreseen that lengthy

time would be required to resolve the teething problem arising from these requirements enacted by EU, comprising 27 countries.

As such, we saw an imperative need to give a seminar to the shipping public (liners, forwarders and shippers) so as to arouse awareness to the development of the new regulation. Representatives from different sectors were invited to disseminate information of the new rule and it was expected that all gray areas could be made clear prior to the rule’s implementation. Representing HAFFA, Mr. Kenneth Chu, Seafreight Sub-committee Chairman has shared with participants the local operations requirement and industrial general response to the EU regulation from the forwarder’s perspective.

There were overwhelming and positive responses from the industry with over 450 participants. For the sake of easy reference, all the PowerPoint materials presented in the seminar, some useful hyperlinks and points-to-note were disseminated to all Members via News dated 23 NOV 2010.

Consultation and Briefing Session on the proposed e-House Bill of Lading Submission Scheme namely “e-Sea Customs Clearance for Inbound Cargo” (海易通 – 海關海運簡易通關計劃 [進口貨物], 27 OCT 2010) Apart from the EMAN Statement 1 Submission Scheme for liners, the Hong Kong Customs have introduced an e-House Bills of Lading Submission Scheme for forwarders. The name of the scheme called “e-Sea Customs Clearance for Inbound Cargo” (e-SCC-IN) which aims to provide easy electronic means for house level information submission and minimize the number of Detention Notice (DN) Form 1 for Cargo Verification (CV) so as to achieve resources saving and improve the operational efficiency in cargo profiling for Customs. Under the proposed scheme, no registration fee or other charges is needed. Participating forwarder is required to auto-submit all house bills of lading of import/transshipment consignments (ocean mode) in excel format to Customs through email according to pre-defined submission schedule. With the advanced HBL information, the Customs will no longer issue D/N Form 1 (for importer verification) unless it is under an exceptional situation. The scheme is in a voluntary basis and for import seafreight shipment only, while legislative amendments are not required.

Before roll-out of the scheme, a consultative meeting between the Customs and the HAFFA Seafreight Sub-committee was held in July 2010. In response to our request, the Customs have fine-tuned the proposal and incorporated file templates to facilitate the operations. In order to facilitate Members to better understand the proposed scheme and collect views, HAFFA also invited the Customs to organize a consultation session on 27 OCT 2010. In the consultation session, the Customs officers gave a briefing on the scheme and invited comments from Members. Thanks to Members’ enthusiastic support, the seminar was successfully held with almost 90 HAFFA participants. Should Members be interested in joining the scheme, please feel free to contact the Customs Officer: Mr. K S Hui at Tel: 3152 0375 or Mr. K T Ng at Tel: 3152 0371. Date: 12 April 2011

(END OF REPORT)

“Workflow under e-SCC Scheme”


SME DEVELOPMENT SUB-COMMITTEE Chairman: ALPHA LOGISTICS (HK) LTD – Mr. Paul Cheung Vice Chairman: GRAND EXPRESS LTD – Mr. Kenneth Chow Members: NAF NORTHERN AIR FREIGHT LTD THE JANEL GROUP OF HONG KONG LTD

WANGFOONG TRANSPORTATION LTD LOGSCOUNCIL (Hong Kong Logistics Development Council) Sponsorship Programme to Support Small and Medium Logistics Service Providers in Information Technology (IT) Applications With the support of LOGSCOUNCIL ELPG (E-Logistics Project Group), a Sponsorship Programme was launched in 2009 to promote the application of information technology (IT) in the operation of selected small and medium enterprises (SMEs). With a view to sharing the benefits gained with other members of the logistics industry. LOGSCOUNCIL has provided a total sponsorship of $2 million to five projects selected by a Judging Panel from the 11 applications received under the Sponsorship Programme. One of the successful projects entitled “Web-based Global Freight Management System” was submitted by a HAFFA member namely “ACE Protrans Forwarding Limited” (ACE). To comply with a condition of the sponsorship, ACE has established a Steering Committee with the involvement of HAFFA SME Development Sub-committee to oversee implementation of the project concerned, as well as to report progress on a quarterly basis. The project formally started in November 2009 and was successfully completed in November 2010. After adopting the web system, ACE recorded a 50% reduction in IT cost since it is not required to install separate server and software at the branch offices and cost of maintenance for regional offices is also reduced. Meanwhile, approximately 50% of its overseas agents adopted the new system for online pre-advice and statement functions. In addition, time for operations is reduced by 60% given the user-friendly feature of the system and manageability of the business for different regional offices is improved using this centralized system. ACE considered that effective communications along the head office, the regional offices as well as business partners can be achieved after adopting this system. The project was officially endorsed by the ELPG during the meeting on 31 JAN 2011. To showcase to the industry, HAFFA will organize a sharing session in the afternoon of 12 JUL 2011, in which ACE will give a presentation on the project. By means of live demonstration and Q & A session, interested members will learn how the use of IT application can enhance productivity and save cost in their operations. Invitation to the sharing session will be extended to all members via News in late May / early June 2011. Please stay tune! Date: 12 April 2011

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