The Regulation on Freight Forwarders (“the Regulation”) has been published in the Official Gazette (No. 30470) on July 6, 2018 and came into force on July 1, 2019. The Regulation brings certain requirements to the freight forwarding companies to improve the quality of their services.
In this article, important aspects of the Regulation and the conditions required for certificate of authorization (CoA) will be explained briefly.
The Regulation defines “freight forwarder” as real or legal persons authorized by the Ministry of Transportation and Infrastructure (“Ministry”) who performs carriage and related logistic services such as storage, packaging, labeling, custom clearance, insurance, distribution etc. by using one or more types of transport, and who issues invoices and concludes contracts on its behalf and account.
Certificate of Authorization
Under the Regulation, it is mandatory for real or legal persons that will perform freight forwarding activities to obtain a CoA and they have to carry out their activities by their headquarters or branches that are notified to the Ministry.
According to the Regulation, the CoA for freight forwarding companies will be granted, renewed, and canceled by the Ministry. As of October 2021, 2120 companies have received this certificate.Conditions mentioned in Article 8 of the Regulation must be fulfilled in order to be entitled for CoA. Among other conditions, a company;
i. must have a capital of at least 300.000 Turkish Lira
ii. must pay a fee of 183.870 TL for the CoA (for 2021)
Furthermore, company officials and employees mentioned in Article 12 of the Regulation should meet the training requirements.
The validity period of the CoA is 5 years. The CoA cannot be sold or seized and cannot be transferred except in situations where there is a company merger or a change in the ownership.
The activities of the CoA holders within the scope of the Regulation are subject to the supervision of the Ministry. Administrative fines are applied in case of violation of the provisions.
Training Requirements for Certain Personnel
One of the aims of this Regulation is to develop a necessary professional training and supervision system for effective freight forwarding services. Therefore, certain employees of real and legal persons holding a CoA must receive relevant training from the institutions authorized by the Ministry of National Education.
At least one of the persons who has a senior role in the company management must obtain a Senior Level Manager Certificate. The partner authorized to represent the company, or at least two persons performing same duties must have the Intermediate Level Manager Certificate.
However, under certain circumstances, abovementioned people are exempt from trainings as well as the exams.
Obligations of Freight Forwarders
Freight forwarding companies that are holding CoA are liable for loss or damage to cargo including theft. They have an obligation to preserve and protect the cargo from the moment they receive it until the time it is delivered. Companies are responsible for organizing the transportation of the cargo in line with the instructions of their customers. Moreover, they are under obligation to provide insurance for the liabilities that may arise out of the transportation process.
There are further obligations that are imposed by the Ministry. Besides, companies are obliged to send periodic reports containing information about their activities to the Ministry. In cases where their legal personality is terminated, they are obliged to give written notice to the Ministry and return their CoA within 30 days from the date of termination.
With the enactment of the Regulation qualifications of the freight forwarding companies, their obligations and liabilities are determined which allows the Ministry to better monitor the players of the industry.