Aftermath of the 2020 Maldives Shipping Regulation. Who Won and Who Lost?

Without a doubt, we know that most, if not all of our daily commodities are imported goods from other countries. However, some may not be aware of shipping agents, the person or company handling arrangements and documentation of shipments which are imported to the Maldives, nor of the charges they carry that influence the selling price of goods.

Prior to 2020, there were no statutes or laws regulating shipping agents in the Maldives. Businesses import goods from abroad without any other choice and customers kept paying shipping agents the fees that they demanded. During the pandemic, businesses voiced their concerns to relevant authorities regarding the many charges shipping agents levy, claiming shipping agents were levying fraudulent fees in addition to the amount agreed. The agents blamed Maldives Ports Limited (MPL) or some companies which were claimed to be created by the same shipping agents. Furthermore, most shipping agents in the Maldives were operated by foreigners, believed to be mostly Sri Lankan citizens.  

The lack of regulation also means no legal rights and protection for the businesses that work with shipping agents. This was evident from the recent case where the civil court justified additional charges levied by Clarion Maldives Pvt Ltd, a shipping agent, against Leo Trading Pvt Ltd. Responding to the complaints from businesses, the Maldives Transport Authority announced that shipping agencies and agents are to be registered in the transport authority and to provide the details of the fees they impose on clients. While this was not a solution to the issue at hand, it did pave the path for the Transport Authority to form the first Shipping Agency Regulation of the Maldives. However, it was repealed by the Minister of Transport and Civil Aviation, Aishath Nahula, on 16th August 2020, only 2 months after its establishment. As reported in the media, the Minister took the decision after consulting the Attorney General’s Office, and without speaking to the transport authority board.

Speaking on the regulation board of the People’s Majlis, Minister Nahula explained that the regulation made to prevent shipping agents from taking additional fees allowed them, in reality, to impose additional fees as administrative charges. She also stated that it allows people other than shipping agents to operate shipping agencies in the Maldives. A newly amended shipping regulation was created a few months afterwards. This is how the current shipping agency regulation came to light. 

As with any other laws and regulations formed, the Maldives Shipping Agency Act gazetted in 2020, also ensures just shipping procedures for citizens, completely eradicating the culture of imposing additional charges by shipping agents. This regulation, instituted under the Maritime Shipping Act, only authorised ‘shipping agent licence’ to companies or partnerships registered in the Maldives and owned 100% by Maldivians. The regulation also made it mandatory for shipping agents to register in the Maldives Transport Authority, now the Ministry of Transport and Civil Aviation, and to renew licences every 5 years. 

According to the amended regulation, shipping agents can’t impose any charges which were not agreed upon with clients. 

The following price-controlled charges are being taken by shipping agents with the new regulation.

• MVR 771 for a full container
• MVR 385.50 for less than a full container
• MVR 385.50 For goods that are not included in the act (shaviyani) (1 and 2)
• MVR 385.50 for amendment charges

Any violation of the regulations is being charged with MVR 1,000 for the first offence, MVR 10,000 for the second offence and MVR100,000 for the third offence.