No Need for Multimodal Operators to Obtain Special Permit, But Just Register Only: ALFI

Yukki Nugrahawan Hanafi

The operators of multimodal transport in Indonesia are not required to get special permit to run the business. What they have to do is just doing registration. This refers to the agreement among the ASEAN countries leaders of AFAMT (ASEAN Framework Agreement on Multimodal Transport), according to Indonesia Logistics and Forwarders’ Association (ALFI/ILFA).

So, for the operators, it is no need to get new permit, nor to make a new company to run the multimodal transportation business.

In a statement to media, ALFI Vice Chairman for International Relationship and Capacity Building Iman Gandi said that Indonesia can adopt the policies of other ASEAN countries who have joint the AFAMT.

“It is not only ASEAN countries, but almost all countries in the world have adopted the multimodal transportation system referring to the handbook of multimodal transport operation issued by UN-ESCAP,” said Iman.

Echoing the view, ALFI Chairman Yukki N Hanafi, who is also Chairman AFFA (ASEAN Federation of Forwarders Associations), suggests Indonesia to follow the policies and systems run by some Asian countries, especially India, the first Asian country that adopted the multimodal system.

India issued Registration of Multimodal Transport Operators (MTO) Rules in 1992. “Our country has to take those as example. No need for a new business permit,” he recalled.

AFFA is a partner of ASEAN secretary in Transport Facilitation Working Group and in the regional implementation of AFAMT. Meanwhile, ALFI/ILFA is an active member of FAPAA (Federation of Asia Pacific Air Cargo Association) and FIATA (International Federation of Freight Forwarders Association).

Just Registration Only

Why does multimodal transportation need registration only? It is because the operators of multimodal transports (MTO) are those who can handle transportation up to door. So, they can be forwarding companies, trucking companies, train companies, shipping lines, or even airlines, according to Yukki.

“We have to understand that the multimodal transportation is one of the system that is usually run by forwarding companies in provision of ‘door to door’ services,” he said.

According to Yukki, this issue becomes a problem for our country because of some policy mistakes, including the laws and regulations in sea transportation (shipping), air transportation, railway, and land transportation.

“The terms of laws are inappropriate and not in line with the international convention. Their inappropriate terms and definition create bias for their subordinate regulations of government and ministerial regulations,” he said.

He said, if the existing regulation (the Ministry of Transportation Regulation No.8/2012) is forced to be effective, there will be dualism. It is because since 1988 until the issuance of the Ministry of Transportation Regulation Permenhub No.49/2017, the JPT companies (freight forwarding) is a multimodal transportation operator.

On the other hand, according to Yukki, to change or revise the four laws in transportation (shipping, railway, air transportation, and land transportation laws) as well as the government regulation PP No. 8/2011, needs a longer time.

“Hence, we expect the Ministry of Transportation to be firm, combining the two rules or erasing the overlapping rules. The longer we have no solution, the faster we will be left behind by the other countries who have been ready for ASEAN connectivity by 2025,” Yukki said.

Yukki criticised the trucking companies that hands multimodal transportation operator (MTO) permit, but they just handle transportation of port to door and door to port. Even, some MTO cannot open branch in neighbouring countries.

“This proves that the regulation is deviated from the multimodal concept itself, while the operators do not understand the AFAMT multimodal concept. How can we build competitiveness within this situation,” Yukki questioned.

Service

Chairman of Indonesia Trucking Companies Association (Aptrindo) Gemilang Tarigan echoed the view. He urged to remove the point relating to multimodal transportation from the draft revision of Law No 22/2009 on Land Transportation since it is not effective. He said the point causes more and more permits and makes the operational cost is more expensive.

According to Gemilang, multimodal is actually a service, so no need for a new special company for it.

Gemilang Tarigan

“Up to now, there are only 10 companies with multimodal permits, though the UU (Law) No 22 has been effective for 10 years. It is so strange. So, no need for a special multimodal company to run the business. And it is better to be deleted from the Law,” he said.

Gemilang also explained that Aptrindo has asked to delete the point from the law uring a hearing with House of Representative (DPR) Commission V on Monday, July 6.

He said that the revision of the law should be able to provide policies support and infrastructure and facility availability to encourage investment in cargo transportation sector.

Gemilang said the Law No: 22 on Land Transportation  should be revised since the law has not accommodated the updated transportation system nor supporting the investment climate in cargo transportation sector as a locomotive for national logistics.

There are three reasons why Aptrindo asked to revise the law: first, the existing transportation technology growth. The law has not adopted the current transportation technology in monitoring and controlling system.

Second, it needs the government role (incentives) in supporting and empowering the development of cargo transportation facilities, and third, the Indonesia’s high logistics cost  that reaches 24.7% of GDP due to poor government role in controlling supply and demand.

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