CONTAINER TRANSACTIONS

Soner ALTINTAŞ
Customs Consultant

Based on weight, more than 60 percent of transportation worldwide is carried out by sea. Again, based on weight, our country is surrounded by sea on three sides and has a coastline of up to 8333 km. The largest share in the transportation sector of our country is taken by maritime transport. Maritime transportation is the first mode of transportation developed by humankind. Transportation, which used to be carried out with containers of different sizes from port to port with limited resources, has become easier thanks to developing technology and container transportation; Containers have enabled the combination of many types of transportation of goods to the final address and enabled the development of maritime transportation.

Although its origins date back to the industrial revolution, containers that were standardized to a modern standard appeared in the 1950s. Containers developed by the US armed forces during World War II. It started to be used during World War II; The US armed forces subsequently focused on the use of containers for their logistics needs during the Korean War and Vietnam Wars. To put it briefly, as seen in many technological developments, the technological products used in the production of war vehicles also contributed to the facilitation of civilian life after a while.

The first transport at today's standards in commercial maritime transportation was made by American entrepreneur Molcolm Mc'Lean in 1956. Later, international meetings began to be held to standardize container transportation.

The standards of container transportation were determined by the "Intergovernmental Maritime Convention" published in 1972.

The definition of container with the said Agreement is made as follows:

“Large crates, mobile cisterns, manufactured in accordance with the technical conditions in Annex No. 4 of the 1972 Customs Convention on Containers, approved according to one of the methods shown in Annex No. 5 of this Convention, with an internal volume of at least one cubic meter and used in transportation works.” or similar,

 1) Fully or partially closed to form a compartment for storing items inside,

 2) Suitable for continuous use and accordingly durable enough to be used many times,

 3) Specially manufactured in a way that does not cause unloading and loading of the goods inside in cases requiring a change of transportation type or vehicle,

 4) Made for practical use, especially in cases of transfer from one type of transportation to another,

 5) A transport vehicle manufactured to be easily loaded and unloaded.

The most commonly used containers are standard 20 feet or standard 40 feet. Today, container types with very variable structures have been developed depending on the characteristics of the goods transported. For example, "reefer" (refrigerated containers) that allow temperature-controlled transportation, "tank" containers for transporting liquids, or "open top" containers for loading bulky items have been used. In order to enable easy tracking of the containers, each container has standardized markings indicating the owner of the container in compliance with ISO 6346. A four-letter, six-digit number and a single-digit control number enabled the container to be monitored securely, and these brands formed the identity of the container.

The "1972 Customs Convention on Containers", which was signed by Turkey in Geneva on 15.12.1972 and approved by Law No. 3930 dated 2.12.1993, was approved by the Council of Ministers on 184.1994 and entered into force by being published in the Official Gazette dated 2.06.1994. With this agreement, the procedures and principles regarding the implementation of Annex B3, which includes the provisions regarding containers of the "Temporary Import Convention" published in the Official Gazette dated 21.10.2004, are in accordance with the "1972 Customs Convention on Containers and the Temporary Import Convention" published in April 2005. It was put into force with the "Regulation on the Implementation of Provisions Regarding Containers".

Regardless of whether the bringer is a customs obligor or not, containers that meet the conditions specified in the said Regulation are allowed to enter the country by customs administrations in accordance with the provisions of the "Temporary Import Regime". The Ministry of Commerce (General Directorate of Customs) is authorized to grant temporary import permits to containers purchased by a person established or residing in Turkey, rented for purchasing purposes, brought through financial leasing or a similar agreement, after taking the opinion of the relevant organizations.

The permit period for the container brought to the country temporarily within the scope of the regime is 6 months from the registration date of the "Entry Container Registration and Tracking Form". It is mandatory to export the container within this period. If the application is made electronically before the end of the period, the period may be extended by the entry customs administration for a period not exceeding 6 months. In case of a second additional time extension request; By applying to the regional directorate with a petition, a second additional period can be obtained based on the instruction given by the regional directorate to the entry customs administration for the evaluation of the request for additional time. In addition, the warehouse exit process of the container arriving empty must be carried out within 45 days after the Container Tracking Form is registered. Otherwise, there is a possibility of encountering penalties due to summary declaration deadline.

The duration of temporary stay abroad of containers to be removed is 3 years. It is mandatory to bring the container to the country within this period. If the application is made electronically within the deadline, additional time may be taken by the exit customs office.

If the container is re-exported or brought to the country within one month following the expiry of the period, an irregularity penalty of 2 times the amount determined in Article 241 of the Customs Law is applied, and if the container is re-exported or brought to the country within a period not exceeding two months following the end of the given period, four times the same amount is imposed. In addition, in cases where the regime conditions are not fulfilled or the period is completely exceeded, penal action is taken based on Article 238 of the Customs Law.

At the beginning of 2017, the "Container and Port Tracking System" was introduced. With this system, the information in the ports, the information from the agencies and shipowners, and the information in the customs administrations are blended and the information is flowed to the screens of the customs surveillance and enforcement officer in charge of the ports, allowing port entry and exit to be made more effectively and controlled. In addition, it has enabled the rapid preparation of containers and goods to be prepared for inspection by the port, as a result of the work order created by the inspection officers giving instructions through the system, for inspections such as "partial inspection, full detection, x-ray" to be carried out by customs inspection officers. Likewise, by ensuring that containers and goods arriving at the ports for export purposes can enter the port after the reservation opened in the port system by the agencies, the waits caused by manual entry records at the port gates have been reduced. Although the import and export system has not yet been activated at the desired level, the early start of many transactions has reduced waiting times at ports and eased paperwork.

One component of this project is “Electronic Container Registration and Tracking Forms”. As of 01.12.2016, the "Entry Container Registration and Tracking Form", which was issued on paper in the old system, can be issued electronically in all customs administrations by authorized persons on any computer that can connect to the internet, and the registration and approval processes are carried out electronically for a certain fee. When creating an electronic form, by selecting the domestic or foreign container entry or exit type from the 'KTF Type' menu, the entry or exit procedures of the full or empty container entering Turkey can be started without going to the customs office. In addition, the remaining duration of containers that have temporarily entered the country or temporarily exited the country can be tracked or requests for additional time when necessary can be made in this system.

If the registration and tracking form data regarding the container is not provided electronically, the information is not filled in properly, or the approval process is not carried out by the customs administration, the container will not be allowed to leave the port even if the exit procedures of the container are completed. Containers leaving full return empty; Based on the empty return information provided by the agencies, the container is delivered either to the empty container storage areas of the ports or to a different storage area with which the agencies have a contract. Failure to deliver the empty container on time causes demurrage expenses, which increases the foreign trade costs of companies.

In export transactions, as in import transactions, containers can enter the port based on the notification made by the agency from the "Electronic Container Tracking System". If the export goods are to be loaded in a container at the port, the transactions are concluded based on the loading order issued by the company or the transporter from the company at the port, together with the container information provided by the agency. The export declaration cannot be registered before the containers enter the port area. As of 20.08.2019, the removal of the obligation to submit export declarations to the customs administration on paper and scanning all attached documents into the system has increased the importance of the container tracking system.

As a result, with these projects, the systems of the customs administration and the port management have been integrated, the effectiveness of customs inspections has been increased, the database used in the fight against smuggling has been expanded, and risk analyzes have been made more accurate. The reduction of paper transactions in ports and the acceleration of transactions have provided time and cost advantages to companies, and it has been possible to effectively monitor the containers arriving or departing from the ports, including their movements within the port, and to produce healthy statistical data regarding their movements.

Source:

Customs Law No. 4458

Regulation on the Implementation of the 1972 Customs Convention on Containers and the Provisions of the Temporary Import Convention on Containers

Circular No. 2017/03 on Container and Port Tracking System

Electronic Container Tracking Form Transactions Obligor Guide

QUESTIONS AND ANSWERS

Question 1. What is a container and what are its features?

Answer: Container;

“Large crates, mobile cisterns, manufactured in accordance with the technical conditions in Annex No. 4 of the 1972 Customs Convention on Containers, approved according to one of the methods shown in Annex No. 5 of this Convention, with an internal volume of at least one cubic meter and used in transportation works.” or similar,

a) Fully or partially closed to form a compartment for storing items inside,

b) Suitable for continuous use and accordingly durable enough to be used many times,

c) Specially manufactured in a way that does not cause unloading and loading of the goods inside in cases requiring a change of transportation type or vehicle,

ç) Made in a way that has practical use, especially in cases of transfer from one type of transportation to another,

d) A transport vehicle manufactured to be easily loaded and unloaded.”

It is defined as .

Question 2. Who can bring containers and what is the permit authority?

 Answer: Based on the temporary import regime, anyone can bring containers that meet the conditions in the regulation, regardless of whether they are obliged to do so, and temporary entry is allowed by the customs administration. The Ministry of Commerce (General Directorate of Customs) is authorized to grant temporary import permits to containers purchased by a person established or residing in Turkey, rented for purchasing purposes, brought through financial leasing or a similar agreement, after taking the opinion of the relevant organizations.

Question 3. How long does the temporarily brought container stay in the country?

Answer: The permit period for the container brought to the country temporarily within the scope of the regime is 6 months from the registration date of the Entry Container Registration and Tracking Form. It is mandatory to export the container within this period. If the application is made electronically before the end of the period, the period is extended by the entry customs administration for a period not exceeding 6 months.

Question 4. What is demurrage?

Answer: In foreign trade transactions, if the period determined by the agreement between the buyer (importer) and the seller (exporter) is exceeded for the unloading of the cargo in the container, it is the delay fee paid by the buyer per container, excluding freight.

Question 5. What are the operations that can be done with the "Container and Port Tracking System"?

Answer: Container Record Tracking Forms, Unloading List, Warehouse Exit Receipts, can be realized.