CAMP and Impending Changes to the IATA Cargo Agency Programme

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1 CAMP and Impending Changes to the IATA Cargo Agency Programme Presentation by Ir Dr Paul Tsui Member CAMP Working Group April 29,

2 HAFFA Competition Law Compliance Follow the prepared agenda. Do not discuss: Pricing, including fares, service charges, commissions, etc. Bids on contracts or allocation of customers Geographic/Product market allocations Marketing plans, including expanding or withdrawing from markets Group boycotts Your commercial relations with agents, airlines or other third parties Any discussion aimed at influencing the independent business decisions of your competitors In case any of the above is discussed then we will ask you to leave the meeting or the meeting may be terminated 2

3 Introduction The air cargo industry has undergone significant changes over recent years, including the emergence of new business relationships, whereby today s freight forwarders, in most cases, conduct business as customers instead of as agent of the airline Source: the IATA/FIATA Co-operation Agreement 3

4 What is Cargo Agency Programme? A global programme where the IATA Cargo Agent is a sales agent for the airlines. The Cargo Agency programmes (8 globally) and its Resolutions are managed by IATA The decision on strategic direction (new or amended requirements) is managed by IATA s Cargo Agency Conference comprised of airline member representatives Decisions are enforced by Conference Resolutions The IATA Accounts Settlement System (CASS) is owned and managed by IATA Cargo Agency Conference is responsible for establishing the financial criteria. General settlement terms and conditions of CASS 4

5 Current IATA Cargo Agency Programme Freight Forwarder CASS Associate IATA Cargo Agency Programme CASS Associate Agreement CASS IATA FIATA Consultative Council CARGO AGENCY CONFERENCE 5

6 Current Cargo Agency Resolutions Current Cargo Agency Resolutions: 801- Global Canada 805 Europe 805zz - EACP 807 China 809 South West Pacific 809zz - Australia 813 LATAM India 6

7 Resolution Process and Handling Security Control measures Ready for Carriage DG acceptance capability 2.Minimum Staff requirements Minimum 2 full time staffs One DG Initial qualification Two IATA Introductory Course Diploma with minimum 3 years experience 4.License to trade Valid license to trade 3.Financial Standing Availability of adequate liquid funds Paid-Up capital commensurate with fixed assets Existence of preferential claim on the assets and contingent liability IATA CARGO ADVISORY PANEL All airline members comprise of expertise in financial, personnel qualifications, premises, and equipment Inspection and submit reports with respect to qualifications of applicant Conduct reviews of Agents under the purview of the ICAP ICAP may (shall) participate in dialogue meetings with representatives of national cargo agents associations. Consider all items that are within the terms of reference. CASS Agents Liaison Working Group (ALWG), to ensure full constitution between IATA and participating carriers with the national association of cargo agents, on the operation of the CASS-Export and CASS Import. In particular, the ALWG shall ensure that any enhancement or modifications to the system, affecting the Agents interests, have been discussed with, and have attracted a board consensus, from the agents association, prior to implementation of them. 7

8 Resolution 805zz (EACP) European Air Cargo Programme Joint Council Airline members accredited by CAC. One representative designed by each national forwarders association in each country covered by the resolution Ex-officio, non-voting members, the IATA Head of Cargo, the Chairman, FIATA Airfreight Institute and the Director General of CLECAT, or the designed representatives of those members. Joint Council Responsibilities Shall determine objective criteria for the registration of intermediaries in the European Area include but not limit to: Financial standing Standards of staff competence, experience and knowledge of air cargo products Suitability of premises Suitability of cargo handling and processing equipment Product and services Not authorized to change or ignore Resolutions May consider all other aspects of the EACP in the European Area and accordingly make proposals to the Conference Changes to relevant Procedure Conference Resolutions shall require the support and consensus of the Joint Council before being implemented in the region covered by this programme. Nominate an EACP Ombudsman. CASS Agents Liaison Working Group (ALWG), to ensure full constitution between IATA and participating carriers with the national association of cargo agents, on the operation of the CASS-Export and CASS Import. In particular, the ALWG shall ensure that any enhancement or modifications to the system, affecting the Agents interests, have been discussed with, and have attracted a board consensus, from the agents association, prior to implementation of them. 8

9 Why are changes needed to the Cargo Agency Programme? The programme was established over 50 years ago During this time the business relationship between the airline and forwarder has evolved Forwarders frequently and routinely act as principals to the airlines rather than agents In March 2012 Tony Tyler CEO committed IATA to modernize the programme Importantly a programme that will operate outside of Conference Resolutions 9

10 Who has been responsible for drafting the new Agreement? The Cargo Agency Modernization Programme (CAMP) Working Group consisting of representatives from Americas, Europe, Asia Pacific of FIATA and IATA and AF, CX, IAG, LH, DL, EK, FX, KL/AF and UA 10

11 What will a new global freight forwarding programme look like? Governed bi-laterally by the IATA/FIATA Governance Board (IFGB) not airline Conference (CAC) 7 Regional IATA/FIATA Joint Councils (CA. LATAM, Europe, India, China, AME, & AUSPAC) Existing Resolutions will be implemented by each Region, Changes require IFGB agreement The programme will continue to use CASS as it s Remittance and Settlement mechanism The CASS operation will remain under the ownership of IATA-not the IFGB 11

12 One Programme Concept 12

13 Timeline and Milestones (1/3) Apr 1 st Cargo committee conference call to assess current position and seek endorsement for planned next steps Apr- May 2014: CAMP/15 & 16 will finalize the "CAMP Principal Issues", IFACP Administration, the Cooperation Agreement and if time permits drafting other CAMP documents. End May: Cargo Committee conference call to assess current position and seek endorsement for IFACP Cooperation agreement signature and set up of IFGB End Jun 2014: Sign the IATA-FIATA Cooperation Agreement and establish the IATA-FIATA Governance Board (IFGB). 13

14 Timeline and Milestones (2/3) Jul Sep 2014: Once established the IFGB will complete the development of the IATA-FIATA Air Cargo Program including Program Administration task assignment, Program Handbook, Freight Forwarder Agreement, budget and rollout out plan for global implementation. Sep 2014: Obtain the endorsement from Cargo Committee for IFACP package, Agency Agreement, Forwarder Agreement prior to submission to CAC. 14

15 Timeline and Milestones (3/3) Oct 2014: No date has been set but consideration should be given to hold a Special Cargo Agency Conference that endorses the IATA-FIATA Air Cargo Program. Q4 2014: Hold a series of Road Shows in the pilot countries and provide the training worldwide. Q1 2015: Launch the new Global Cargo Agency Program and IATA-FIATA Air Cargo program. 15

16 Next CAMPWG Meetings CAMPWG #16 Date: May Location: GVA Venue: IATA office CAMPWG #17 Date: June or June? or June? Location: MAD or BRU Venue: TBA 16

17 Questions Are IATA s airline members supporting the new programme? Will I have more liability than before under the new programme Will my CASS terms be changed- e.g. shorter payment deadlines and stricter financial criteria? Will anything change and affect my day to day dealings with the airlines? 17

18 Website : 谢谢 18