Hutchison Whampoa

Anti-terror levy faces opposition

PUBLISHED : Tuesday, 03 February, 2004, 12:00am
UPDATED : Tuesday, 03 February, 2004, 12:00am

Hutchison's bid sets table for industry's first legal battle over security charges

Hutchison Whampoa's bid to recover the costs of having to secure its terminals against potential acts of terrorism has met strong opposition from customers at its two biggest ports in Europe.

Shippers and forwarders at the ports of Felixstowe and Rotterdam are baulking at proposed fees of up to GBP10.50 (HK$148) for moving boxes over the docks, with Hutchison's British customers questioning the levy's legality.

Lawyers representing the British International Freight Association at the weekend urged Hutchison Ports (UK) to delay application of the import levy, which law firm Davis Lavery said contravened Britain's 1964 Harbours Act.

But Hutchison imposed the charge on Sunday, potentially setting the table for the industry's first legal battle over security fees.

'I'm sure every terminal operator and related government authority will watch this case very carefully for its precedent,' a London-based spokesman for Davis Lavery said. 'The British government should review this as a matter of urgency.'

In Rotterdam, shipping lines followed their British counterparts by saying they would refuse to pay a proposed Euro10 (HK$96) per box levy, even though a date has yet to be set for its implementation.

Hutchison's majority-owned European Combined Terminals handled more than 80 per cent of Rotterdam's 7.1 million boxes last year.

Yesterday, Hutchison sources in Hong Kong said the ports in question would be facing 'significant' costs, which they aimed to recover 'without looking to profit'.

The surcharges also have been criticised for a lack of transparency, a matter Hutchison said was out of its hands as it sought to comply with the globally mandated International Ship and Port Security Facility Code, effective from July 1.

'A large number of the security systems to be installed are by their nature secret, therefore we are unable to practically disclose the cost breakdown,' a Hutchison Port spokesman said. 'The ... costs and the calculations underpinning the rates are based on commercially sensitive information.'

Opponents of the fees said most of the costs associated with improving security infrastructure were one-off expenses, but the levy was an ongoing proposition with no withdrawal mechanism.