Thousands of lorries built with shipping containers as customs fails to monitor empty containers; tax evaded
If you see a lorry on the street, chances are it was built by bolting a modified shipping container onto the chassis.
It is so common a way to build lorries that Mokbul Ahmed, chief of Bangladesh Covered Van Truck Goods Transport Owners’ Association, said, “Most of the lorries, between 96 and 98 percent, have been made with shipping containers.”
It costs Tk 2 lakh to Tk 2.5 lakh to construct the body of a lorry with a shipping container, he added.
There is a reason why building lorries with containers is so cheap. It is cheap because it is done by dodging government tax and fees, and it is illegal.
Containers being sold illegally in Chattogram’s Nayabazar area recently. Photo: Rajib Raihan
Due to customs authority’s negligence and no monitoring, shipping containers -- brought in from abroad and supposed to return with export goods or empty -- are being sold in the local market evading customs duty.
And these are being used for making lorries (also known as covered vans), shops, and temporary housing. The market is worth about Tk 50 crore, said insiders.
More than 100 workshops in Dhaka, Chattogram, Narayanganj, and Gazipur have been selling both used and new, empty containers.
Bangladesh does not make the containers, but there are 34,543 lorries (covered vans) registered with the BRTA as of September 2019.
Shipping agents bring in the containers from abroad either empty or with imported goods mostly through the Chattogram Port. The containers themselves are not goods and they do not require import duty, provided they are shipped off within six months.
If the containers are not sent back, the shipping agents are liable to pay Tk 60,000 import duty for each 20-feet container and Tk 1.40 lakh for 40-feet containers, states Customs Permanent Order-01 dated 14/02/1999.
NO MONITORING, EXCUSES
When an empty container arrives in the country, the shipping agent concerned submits a detailed list (called BL) to general bond section of the customs. An entry is also made into the server of customs.
Empty containers do not require bill of entry, but customs officials can find out where a container is by searching their server and the BL.
However, Fakhrul Alam, commissioner of Chattogram Customs House, said they do not know the number of empty containers brought in or sent back with export goods, as import documents such as bill of entry or letter of credit are not required for empty containers.
He said while shipping agents must pay duty if any container is destroyed or sold, no money has ever been paid to customs for this.
Yet, at various container selling shops and workshops in Chattogram, this correspondent found at least 57 empty containers with tracking numbers.
The tracking numbers of seven containers was cross-checked by this correspondent with data on Chattogram port’s server Container Terminal Management Service (CTMS).
CTMS showed that the containers entered Bangladesh between August 21, 2018, and June 24, 2019, and were shown to be at the port’s yard.
One of the containers (with tracking number FCIU3138251) was found at the Ajmir Marine Enterprise’s workshop in the port city’s Nayabazar area. According to the CTMS and customs server, it was brought in by HR Shipping Lines Ltd on June 1 last year and is still in the port.
Omar Faruk, secretary of Chattogram port, told The Daily Star that the port’s server was not updated regularly.
He said they would enquire how the server was still showing wrong information on containers that were taken out of the port so long ago. “We will verify the information,” he added.
About container FCIU3138251, Rakibul Islam, managing director of HR Shipping Lines, told The Daily Star, “This container might have been taken outside the port or the (inland container) depot but we do not know how.”
He said sometimes a container can be destroyed, or sold at auction, when it arrives at its last destination after its expiry. However, that too must be done upon customs authority’s permission and paying duty.
“Till date, we have not sold or destroyed any container,” he claimed.
Last year, an investigation into at least 6,000 import consignments, some of which went missing and remained undelivered, revealed that shipping agents and owners of inland container depots were not following the customs’ rules regarding containers.
The probe is still on and officials could not say how many containers were actually missing.
Joint Commissioner of Customs Shariful Hasan, who led the investigation, told The Daily Star that the general bond section of Customs House is not monitoring the containers and government is losing revenue due to lack of supervision.
Nitish Kumar Biswas, assistant commissioner of general bond section, and Swapan Kumar Bepari, revenue officer of the Customs House, told The Daily Star that they do not know anything about the 1999 order of the Customs House.
Swapan said most of the shipping agents and private depot owners submit a list of containers transported from the port to the depots. But no verification is done to ensure if containers leaving the port actually ends up at the inland container depots.
The president of Bangladesh Inland Container Depots Association Nurul Qayuum Khan said depot owners were liable to pay compensation for any missing containers.
He said,“Till date, no shipping agents have ever complained about any missing containers.
“We all know that empty containers are taken outside the depot illegally and sold in the market but I do not know how this happens.”
He suspects that some of the 18 private depot owners as well as shipping agents could be involved.
Ahsanul Haque Chowdhury, president of the Bangladesh Shipping Agent Association, maintains that empty containers are not being imported for sale.
“Some quarters may be selling those illegally,” he said
Regarding the customs policy about selling containers, he opined that many people might not know about the order because it was old and that customs should reissue a circular to create awareness.
Jasim Uddin, proprietor of Ajmir Marine Enterprise, however, told The Daily Star that he buys all his containers from shipping agents.
“I do not know the law about empty containers. We buy empty containers from different shipping agents, who sell the containers unsuitable for carrying cargo with permission from the principal company (the main owner of the containers),” he said.
Usman Goni, who owns three container workshops in the capital’s Farmgate, Kamalapur and Chattogram’s Sadarghat area, asserted that the empty container trade could not be illegal since the money is transacted through banking channels.
He claimed that the shipping agents and the principal owners of the containers make contracts to bring these boxes to Bangladesh for resale.
Seeking anonymity, a managing director of a shipping agent company, admitted to selling containers to meet unaccounted shipping expenses.
The MD said many shipping agents and owners of private inland container depots were compelled to sell containers in the market, knowing that such sales were illegal, as shipping agents often have to bribe to get clearance for ships.
Besides, they also have to bear the cost of storing the containers at the port yard or inland container depots when importers do not take delivery of their consignments, the MD said.