Shipping Agencies Are Strategic to Strengthen National Shipping Industry: ISAA

The shipping agencies doing business in Indonesia are very strategic and playing a key role, both in strengthening the national shipping lines capability to fully control domestic market on one hand, while on the other hand to help them (national shipping lines) to go global, according to Indonesia Shipping Agencies’ Association (ISAA). 

Realizing this key role, the government has acknowledged and backed up their (shipping agencies) existence and status. The government has issued a certain regulation for this business entity, adjusting that all agencies should handle shipping agencies business permit (SIUPKK). 

“SIUPKK refers to the shipping law (UU 17/2008) and its implementation guideline has been detailed in the PP (government regulation). This PP has been released according to a deep analysis. Those who run the business are referring to this law,” Juswandi Kristanto, Chairman of ISAA, said in a press statement this morning (Friday, February 5, 2021. 

Juswandi underlined that shipping agencies, member of ISAA that hold SIUPKK permit, will even support to strengthen synergy among shipping companies, especially the ones member of Indonesia National Shippowners’ Association (INSA). 

According to Juswandi, there are some conditions, rationales and benefits why SIUPKK is very reasonable, among others first, shipping companies (lines) who have been holding shipping permit (SIUPAL) can take more focus on their core business, both in domestic and oceangoing market. 

“No need for national shipping lines, including members of INSA to worry about the SIUPKK. They can take focus on expanding business on oceangoing market,” said Juswandi 

Second, SIUPKK will provide alternative option to customers. In addition, the shipping lines who hold SIUPAL can also act as agencies, giving another option for customers. 

Third, SIUPKK potentially support a joint venture between national and foreign shipping. This will finally strengthen the growth of national shipping and potentially add numbers of national fleets. 

Fourth, in getting cargoes to feed their fleets, shipping companies have to follow some term of trades in which they will face different term of trade in export and import. “Our import is running under C&F (Cost and Freight) term of trade, while our export is under FOB (free on board). Further, there are some issues of taxes,” Juswandi explained. 

In view of the points above, according to Juswandi, any judgements and efforts to stand against the existence of shipping agencies business are so unreasonable and do not make sense. Moreover, the Shipping Law (UU) 17/2008 and the Government Regulation (PP) 20/2010 have clearly declared it (shipping agencies), while those with SIUPAL are expected to take focus on their core business.  

Juswandi noted that the government mission and target for national shipping companies to expand their market share in oceangoing will not be achieved if they (national shipping lines) do not take focus on their core business and are not serious to build their competitiveness. 

“Strong competitiveness is only be achieved through taking focus and build professionalism,” he said. 

Relating the capital for a company to get SIUPKK, Juswandi explained that it refers to the Minister Regulation PM 24/2017. 

Juswandi explained that ISAA has encouraged all members to adopt and update their Information and Technology in service provision, in responding the changes to digitalization era.

“This is to build their competitiveness in the global market,” he said. 

ISAA Is Government’s Official Partner

As the reports have said, the government (Ministry of Transportation), had released the SIUPKK as permit for agencies of foreign shipping (ships) in Indonesia. 

Meanwhile, ISAA as the association of shipping agencies with SIUPKK, has been legalized by the Ministry of Law and Human Rights (Kemenkumham) in 2017, through Letter No AHU-0009909.AH.01.07/2017. In addition, the Ministry of Transportation, through its decision (KM) No KP 1038/2017, also acknowledges ISAA as an official partner of the ministry. 

Meanwhile, the Shipping Law No.17/2008 Article 31 Point (J) clearly states that for smooth flow of water transportation activities, it can be run by shipping agencies. 

Furthermore, the Ministry of Transportation has also issued Regulation PM 11/ 2016 and its revised version of PM 65/2019 on the Business and Operation of Shipping Agencies.

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