Business

Wednesday August 12, 2009

Miti urged to withdraw certs of approval for steel, iron-ore

By ZAZALI MUSA and SHARIDAN M. ALI


It is causing a furore at major customs checkpoints

PETALING JAYA: A new ruling requiring imported steel and iron-ore products to have certificates of approval (COAs) is causing a furore at major Customs checkpoints.

Airfreight Forwarders Association of Malaysia (AFAM) says some iron and steel products, including bolts, nuts and screws, were now stranded at several air, sea and road entry points into the country as Customs was unable to clear these shipments without approval from the Construction Industry Development Board (CIDB) and Sirim Bhd.

“This has caused great financial losses that include downtime in production lines in the manufacturing sector, unnecessary costs from demurrage or storage and handling charges,” it said in a letter to the International Trade and Industry Ministry (Miti) dated Aug 10.

AFAM also urged Miti to immediately withdraw the implementation of the ruling to ease the movement of goods and called for an emergency dialogue with all concerned parties to iron out the procedures and guidelines for approval before re-implementing it.

MITI secretary-general Tan Sri Abdul Rahman Mamat … ‘There is no serious logjam of iron and steel products reported at major ports in the country. We are monitoring the major ports on a daily basis.’

Effective Aug 1, all iron and steel importers are required to obtain COAs or letters of exemption before being allowed to bring in products into the country.

The ruling on COAs, which are issued by CIDB for the construction sector or by Sirim for the non-construction sector, follows the liberalisation of the iron and steel industry

The move is aimed at preventing the influx of sub-standard products into the country.

Miti, however, denied there was a pile-up of iron and steel products at major ports.

Its secretary-general Tan Sri Abdul Rahman Mamat said there was no serious logjam of iron and steel products reported at major ports in the country due to the implementation of the mandatory standards.

“We are monitoring the major ports in Port Klang, Pasir Gudang, Penang, Kuantan, Tanjung Kupang, Tanjung Puteri, Kota Kinabalu and Kuching on a daily basis,” he said in Kuala Lumpur yesterday after a briefing on the iron and steel industry mandatory standards.

He said the ministry expected “teething” problems in this transition period. “But, Miti, Sirim and Customs are doing our best to ensure the smooth implementation of the new policy,” he said.

To date, 1,226 COAs, 153 temporary COAs (prior to product testing) and 606 letters of exemption from COA have been issued.

And a total of 91,427 tonnes of iron and steel products which required COAs have been cleared by Customs.

Rahman said those who required assistance in the matter could call on Miti’s special team.

“Furthermore, applications for exemption letters for COA can be made at the Sirim branches in Penang, Johor, Sabah and Sarawak,” he said, adding that the industry had ample time to adjust since the policy review was announced on June 17.

Rahman reiterated that the policy review and mandatory standards were vital for the development of the local iron and steel industry as well as its downstream activities.

Meanwhile, Johor Freight Forwarders Association (JOFFA) said lorries carrying steel from Singapore were stopped at the Tanjung Puteri and the Tanjung Kupang Customs checkpoints at the Causeway and the Second Link crossing respectively.

According to its president Toon Teng Fatt, the lorries were not allowed to pass through as the steel products they carried did not have any COAs.

He said the lorry drivers who contacted him claimed that Customs officials told the drivers that they could not do anything as the inspection of the cargo came under Sirim.

“However, there are no Sirim officials seen at both entry points and to make matters worse, only officials from the Shah Alam headquarters are allowed to inspect the cargo,’’ Toon told StarBiz in a telephone interview.

He said apart from lorries carrying steel products, those transporting bolts, nuts and nails were also not allowed to pass through the checkpoints.

A Johor Port spokesman said the port was not aware of any logjam of steel products at the port in Pasir Gudang.

He said the port did not carry out any inspection of cargo as this would be done by Customs officials stationed at the port. Moreover, any logjam of cargo was usually related to the Approved Permit issue.

A licensed manufacturing warehouse operator in Johor which exports 100% of its finished products also had difficulty bringing in iron and steel items recently.

“There is confusion as to how to obtain or apply for the COAs. I do not see why we have to apply for the COAs as all the finished goods are for the export market,” its spokesman said.

Meanwhile, Sirim has since February been having briefings on the importation procedures for iron and steel products in major cities. It is also conducting twice-a-day briefings at its headquarters from Aug 4 to 15.

According to its website, licensed manufacturing warehouses that export 100% of products could apply for exemption letters to import steel and iron products without COA.

The exemption is also applicable to steel and iron products of less than 500kg and of Malaysian, international or other equivalent standards.

An importer may also apply for a letter of exemption if there are no Malaysian, international or other equivalent standards available.

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