Paper 8: Cargo Operations and Management Module-06: Cargo & Freight Organizations
THE DEVELOPMENT TEAM Principal Investigator Prof. S. P. Bansal
Vice Chancellor, Indira Gandhi University, Rewari
Co-Principal Investigator Dr. Prashant K. Gautam
Director, UIHTM, Panjab University, Chandigarh
Paper Coordinator Prof. S. P. Bansal
Vice Chancellor, Indira Gandhi University, Rewari
Paper Co-Coordinator Dr. Amit Katoch
Assistant Professor, UIHTM, Panjab University, Chandigarh
Content Writer Dr. Amit Katoch
Assistant Professor, UIHTM, Panjab University, Chandigarh
Content Reviewer Prof. S. Kabia
Chairman, Institute of Tourism and Hotel Management, Bundelkhand University, Jhansi
ITEMS DESCRIPTION OF MODULE Subject Name Tourism & Hospitality
Paper Name Cargo Operations and Management Module No. 06
Module Title Cargo & Freight Organizations
Objectives To become acquainted with the Cargo & Freight Organizations Keywords Cargo organisations, Freight organisations
TABLE OF CONTENTS
1. Learning Outcome of module 2. Introduction
3. IATA 4. ICAO 5. AEA
6. A4A (formerly ATA) 7. ULD CARE
8. 3. FIATA - Fédération Internationale des Associations de Transitaires et Assimilés 9. The International Air Cargo Association (TIACA)
10. GACAG 11. WACO
12. UFO - Universal Freight Organization
13. IFCBA- International Federation of Custom Brokers' Association 14. TIA - Transportation Intermediaries Association
15. BIFA - British International Freight Association 16. FTA - Freight Transport Association
17. FFFAI - Federation of Freight Forwarders’ Associations in India 18. Brihanmumbai Custom Brokers Association
19. Summary
QUADRANT I
SOURCE: https://www.lufthansagroup.com/fileadmin/_processed_/7/1/csm_140616_Lufthansa_Cargo_Boeing_777F_DALFD_bc113505e8.jpg
1. Learning outcome of module
After completing this module, students will be able to learn about Cargo & its stakeholder organisations:
1. The airlines organisations like IATA, ICAO etc.
2. The Forwarders organizations such as FIATA, IRU etc.
3. General industry organizations such as TIACA, GACAG etc.
4. The Shippers organizations such as GSF, ESC, TAPA etc.
5. The Postal organizations or the airmail SUCH AS UPU, IPC etc.
6. The Brokers organizations such as IFCBA.
7. The Cargo Organisations in India 2. Introduction
The business entities which are specialized in transferring or transporting the goods / materials / cargo / freight from one destination to another place are known as freight companies. These companies are of diverse nature and follow a variety of operations. For example, if we talk about domestic freight dispatchers they transfer cargo from one place to another but in its own country only whereas international freight dispatchers transfer the cargo from one country to another.
These companies are member to several organizations such as IATA - International Air Transport Association, TIA - Transportation Intermediaries Association, the FTA - Freight Transport Association etc. depending on their core function or general operations.
For the transportation of cargo or freight, there are four modes: road, sea, air and rail. There are many firms that provide the multi – modal solutions or single specialized service to their customers. The transferring process is assessed by three elements i.e. Time, Cost and Product characteristics.
The various Cargo and freight Organizations are operational according to operation or general operations of the industry such as:
In international context The Airlines organizations:
1. IATA 2. ICAO 3. AEA
4. A4A (formerly ATA) 5. ULD CARE
Forwarders organizations:
1. FIATA
2. Universal Freight Organization
3. IRU - International Road Transport Union 4. UIC - International Union of Railways
5. TIA - Transportation Intermediaries Association 6. BIFA - British International Freight Association 7. FTA - Freight Transport Association
General industry organizations:
1. TIACA 2. GACAG 3. WACO 4. WCO / OMD Shipper’s organizations:
1. GSF 2. ESC 3. TAPA 4. ICS 5. SMDG
Postal organizations or the airmail:
1. UPU 2. IPC
Brokers organizations:
1. IFCBA- International Federation of Custom Brokers' Association In India
1. Federation of Freight Forwarders’ Associations in India 2. The Indian Institute of Freight Forwarders
SOURCE: https://50skyshades.com/images/o/goh-choon-phong-new-iata-chairman-11126-0hNRs27lzrH7cY3yNcZw3k199.jpg
3. IATA - International Air Transport Association
IATA stands for International Air Transport Association which is basically a trade company of world’s airlines. This represents 117 countries, contains 274 airlines, main carriers, the International Air Transport Association's airlines that are the member’s books for taking approx.
83%of all the seats present air traffic. The work of IATA is basically to give support to airline works and action, also helping in formulating industries standards and policies. The headquarters of IATA is in Montreal, Quebec, Canada along with this they have executive offices in Switzerland. IATA was introduced in Havana, Cuba by the mid of April, 1945. This is basically the successor of International Air Traffic Association that was founded in 1919 in The Hague, Netherland. Only 57 airlines from 31 countries were there in IATA when it was formed.
Much of IATA’s early work was technical and it provided input to the newly created International Civil Aviation Organization (ICAO), which was reflected in the annexes of the Chicago Convention, the international treaty that still governs the conduct of international air transport today.
In 1947 the first ever Traffic Conference took place in Rio de Janeiro and these resulted to be integrated with around 400 resolutions. If talk about the growth of aviation it has grown very fast.
Prime Concern of IATA
Safety: IATA’s main and one of the major concerns is the safety. The most important tool for this is the IATA Operational Safety Audit. By various countries IATA Operational Safety Audit also has been given authorities at the state level. Aviation announced 2012 as the most secured year at all times. IATA introduced an exceptional team for the study of various measures to track aircraft in flight and this was done in June, 2014. This step was taken in retaliation to the missing incidence of 8 March 2014 when Malaysia Airlines Flight 370 was disappeared.
Security: The 11 September 2001 attack resulted in focusing more on security. Following a series of uncoordinated rules by different countries, the industry has developed a Checkpoint of the Future, which is based on risk assessment and passenger differentiation.
Business Simplification: In 2004, simplifying the Business was introduced. This action has initiated many important ideas to passenger travel, which also includes the concept of the electronic ticket and the boarding pass which are bar coded. A large number of different new ideas are being accepted as part of the Fast Travel strategy, which includes a scope of baggage options as a self-service.
New Distribution Capability concept was initiated in 2012 which was an innovative program. This program is basically a set of technology standards, according to which airlines will be given the opportunity to sell all their products with the help of third parties.
Environment: The following three environmental goals have been agreed by all the members of IATA and all the stakeholders linked with this industry:
1. From 2009 till 2020, a usual enhancement in fuel efficiency by 1.5% every year.
2. From 2020 a cap on net carbon emissions from aviation.
3. In relation to 2005 levels, a 50% depletion in net aviation carbon discharge by 2050.
Services: IATA gives various services like consulting and training in different areas linked with aviation. Billing and Settlement Plan are also run by IATA; basically it is a sum of
$300 billion and more financial system which monitors airline money. Various services as well as business intelligence publications are provided by IATA. Various training courses for beginners as well as courses for senior management are provided by them which include all measures of aviation. They also provide various ticketing course.
Publications – standards: Many standards are represented under the IATA’s umbrella.
Most important out if them is the dangerous goods transportation (HAZMAT).
SOURCE: https://www.icao.int/safety/Reporting/formapp/assets/splash.png
4. ICAO - International Civil Aviation Organization
Initially the convention was signed by 52 states on 7 December 1944 which was called or named as the convention on the international civil aviation. It was also known as Chicago convention. For being declared as the specialized agency confirmation was still required from 26 states as well.
Therefore, PICAO was constituted. It worked from 6 June 1945 till 4 April 1947. Finally after the confirmation ICAO came into existence on 5 March 1947. It was declared as specialized agency by UN which associated to economic and social council.
Purpose of ICAO
1. The evolution of ICAO can lead to the social understanding among the nations and which could bring togetherness with the people as well but it could be a flaw to the social security.
2. It could help and maintain the peace among the adjoining states while cooperating with them rather than violating peace.
3. The government has set some guidelines as per proper working of an organization which would lead to no loopholes and effective management. This will allow to maintain proper coordination.
An ICAO has been declared as the specialized agency therefore it is known as global forum for civil aviation. ICAO main purpose as mentioned above is only the co – operation among the members state which would lead to the development of the organization.
There are some specific objectives behind the organization:
1. Increasing safety and security
2. Controlling the negative effects of civil aviation on environment.
3. Enhancement of the skills of operation in avoiding wastage of time / efforts.
4. Allow the persistence work
5. Sustain and fortify the law in the organization.
SOURCE: http://www.scarletdesign.eu/page1/page37/files/stacks-image-bf4d467-1200x848.png
5. AEA (Association of European Airlines)
It is a magnificent airline ruling over 50 years which has 36 airliners in total. This has led to the major development of the organization. European airline works worldwide. It worked with the members of business which were created by contract and other people which could result in the development of the organization before it come to an end in 2016, airline industry has worked globally at larger level by carrying over 300 million passengers and 4.5 million tons of cargo and they even rendered work to 2,70,000 people. They conduce to 530 different destinations in 140 countries which contributed to turnover of Euro 100 Billion. When we talk about the fact, the presidents of Air France, KLM, Sabena, and Swissair clubbed together.
They initiated with the addition of the BEA and SAS. As it was earlier named Air Research Bureau, it lay down on permanent basis in Brussels in February 1954. Later the name was changed to AEA.
In order to promote and enhance the air transportation in Europe, ARB organized Strasbourg conference in 1954 whose main motive was the coordination of the transport in Europe. This resulted in creation of ECAC.
SOURCE: https://www.osia.org/images/Airlines%20for%20America.jpg
6. A4A -Airlines for America
A4A previously called as Air Transport Association of America. A4A was the first ever and the only left trade organization of the principal U.S. airlines. This is an association for American trade as well as lobbying group which were established in Washington, D.C which showcase the largest airlines. The airlines which are the member of the A4Aand all their affiliates contribute in transporting 90% of passengers and cargo traffic in airlines within U.S.
Important initiatives of ATA in present time include:
Safety as priority
Reforming Energy product
Support International structure for pursuing Emission depletion
Reduces the Burden of Increasing as well as Unfair Tax
It was found in 1936 since it was found major role has been played by the Air Transport Association of America regarding aviation’s in many notable government decisions that includes:
Introducing Civil Aeronautics Board
Federal Aviation Administration (FAA) launching
Introducing air traffic control system
Removal of Airline regulations and restriction
SOURCE: https://www.uldcare.com/wp-content/uploads/2017/03/Book-Mockup-ULD_Essentials-1.jpg
7. ULD CARE
ULD care is a non - profit organization based in Canada. The membership of the organization is open to those which comes for the aircraft unit load device. It was initially a part of IATA in 1971 and finally became a statutory entity in 2011.
The main objective behind the work is to utilize the effective resources in proper way and develop the skills in such a way which could present a change in ULD operational scenario.
The perspective behind ULD CARE was not the location or the procedure but it was how the things were handled responsibly by the people. It was effectively and efficiently managed by the employs that were well trained in advance because of this proper input of the resources it allows to achieve all the requirements.
Core Activities
1. It has led to good use of technology which allows to mark the ULD database system, and worldwide ULD control System which allows to track the movements between the members and calculate the delay in the air cargo or freight as per their scheduled departure:
2. To ease the regulatory abidance and allows to perform repeatedly to acquire skills for ULD operations.
Deliverables
1. ULD Care shall be repeatedly addressing its memberships and other resources for:
2. Eradication of the scrap and orderliness in the operation 3. Risk management in ULD functioning
4. Use of New technology has also came into existence 5. Standardization of the organization work globally Initiatives
1. Judging the requirements of industry
2. Finding out the solutions and ways to fulfill those requirements 3. Build actions in order to help these solutions
4. Advertise the industry in terms of new principles and processes
SOURCE: http://www.somatra.ch/img/logo_fiata1.jpg
8. FIATA - Fédération Internationale des Associations de Transitaires et Assimilés
This organization is a non- governmental firm, showcase in present time an industry which covers nearby 40,000 forwarding industries, "Architects of Transport" is the name with which FIATA is known, In 150 countries approximately 9 - 10 million employees work under FIATA.
Main Objectives of FIATA are:
1. Combining the freight transforming corporation worldwide.
2. Showcasing, promoting and safeguarding the company’s interest by appointing as experts or advisors in conferences of international organizations doing the work of carriers transferring.
The organizations, which most of the time meet twice in a year, technical work of the Federation is carried out by them. At present FIATA have three institutes:
Multimodal Transport Institute
Airfreight Institute
Customs Affairs Institute
SOURCE: https://sclsummit.ten.miramedia.net/wp-content/uploads/sites/26/2017/06/TIACA-logo-300DPI.jpg
9. The International Air Cargo Association (TIACA)
TIACA is a worldwide non-profitable trade corporation which represent all the main components of the air cargo as well as logistics firm:
Combination and all-cargo airlines
Forwarders
Airports
Ground handlers
Road carriers
Customs brokers
Logistics companies
Shippers
IT companies
Aircraft and equipment manufacturers
Trade press
Educational institutions
Main objectives of TIACA’s are:
Easing and observing the execution of exercise such as e-commerce right through the supply chain of the air cargo;
Observing the interests at multinational level and the national level of the air cargo organization ahead applicable firms.
Lifting the quality of performance of industry as well as updating the practices of customs
Development and promotion of plans as well as strategies
TIACA Representation
TIACA basically works to represent as well as advocate the air cargo industry’s interests at conferences of applicable firms which includes UNCTAD, WCO, OECD ICAO, and many other which are open to the observers of trade.
The International Air Cargo Forum & Exhibition
International Air Cargo Forum and Exhibition supported by TIACA’s and is held every other year is the leading event of air cargo organization. This event is of world-class level revolves every two years in-between Asia and Europe, the Americas. Current industrial challenges and upcoming opportunities are discussed at ACF by the decision-makers of air cargo industry from all around the world.
Recognition of Industry Excellence
With the help of assessment as well as nomination, they identify and gives credit to the professionals of air cargo for good and marvellous performance, revolution, contributions and achievements by the reputable annual Air Cargo Hall of Fame award.
Education
Educational programs are developed by TIACA that helps all the members of air cargo community from all around the world which is according to the directions of the board.
Some main People Linked with TIACA is:
1. Vladimir Zubkov- TIACA Secretary General
2. Sebastiaan Scholte- TIACA, Vice-Chairman, Jan de Rijk Logistics
3. Sanjiv Edward- TIACA Chairman, Delhi International Airport 4. Vincent Carrodeguas- TIACA Treasurer
10. GACAG
The International Air Cargo Association, The International Federation of Freight Forwarders Associations, The International Air Transport Association and The Global Shippers' Forum decided on November 2010, to introduce a new advisory group to safeguard air cargo industry so as they can have strong, powerful unite voice in its dealings with the authority from all around the world and many other organizations that have direct influence on air cargo with their decisions.
11. WACO
WACO System is a Non – Profitable organization. They have London based Executive Director.
WACO was introduced in 1973 with a motive of connecting the best cargo forwarding industries all around the world. The Head Office of WACO is in Zurich and in London they have operations management. It is the worldwide famous independent global cargo management and logistics network. This company is owned and run by the members itself that’s why this company is an association. This is basically the network which contains many independent cargo management organizations. Approximately 21000 employees work under this association and they have 111 members around 108countries and they provide a network of 400 locality. There have an annual turnover of $4 billion. They are the main player in world market.
Principles of WACO:
1. Providing a high - level worldwide network to some of the preferred cargo management organizations
2. Dedication to membership growth and preservation
3. Identify the different requirements of members of WACO 4. WACO HO supporting to “make things happen”
Some main People Linked with WACO is:
1. Thomas Reuter- Board Member 2. Shinji Kitamura- Board Member 3. Richard Charles- Executive Director
4. Arthur A. da Silva- Vice Chairman 5. Stephen Knight- Chairman
6. Krisjan Pallsen- Board Member
SOURCE: https://secure10.eventadv.com/nineteen/registration/Resources/UKSEC2017/universal_freight_org.jpg
12. UFO - Universal Freight Organization
In January 2000, Universal Freight Organization was introduced and established by Rachel Humphrey; this was registered in the United Kingdom and the company No was 396679. This organization basically works to provide independent freight forwarders access to a trusted, worldwide network of agents who could handle their shipments, whilst working professionally and safely under a strict Code of Conduct.
Presently Universal Freight Organization is an ISO 14001 (Environmental Management) as well as ISO 9001 (Quality Management) certified organization which have been introduced on the basis of:
1. Mutual trust 2. Shared knowledge 3. Experience 4. Resources
5. To help each Member
Other Important Facts about this organization:
The Head Office of UFO is based in the United Kingdom
This organization has 118 Independent Forwarders
They have an access in more than105 Countries
They have 16 Annual Network conferences
They have covered more than 2,000air and sea ports
Approximately more than 3,000 people work under this organization
They have more than 400 offices all around the world
Every month Universal Freight Organization handles more than 3,000 shipments
SOURCE: http://www.heavyliftpfi.com/images/items/June%202014/ifcba%20india%20officers.JPG
13. IFCBA- International Federation of Custom Brokers' Association
Since 1990’s, the interest of customs brokers from all around the world have been represented by IFCBA. Custom policies and working is monitored and improved by IFCBA on worldwide level.
The development in last benefits both clients as well as members.
Custom brokers can Build their business, enhance their reputations and secure their role in the supply chain by simply working jointly.
Latest update on trade information is provided word wide to the members through e-mail by the IFCBA. They also organize conferences and meetings to keep the members updated about the key importance of this industry in world.
From 17 May 2016 to 21 May 2016 the last year annual conference was held in shanghai. They have also published the practices of licensing of custom brokers.
Their Office is at
55 Murray Street, Suite320 Ottawa, Ontario
Canada.
SOURCE: http://www.tianet.org/images/TIA/TIALOGOS/CTB%20Logo.JPG
14. TIA - Transportation Intermediaries Association
The Transportation Intermediaries Association (TIA) is the leading company in terms of third-party logistics professionals which is having business setup in North America. They provide:
Resources
Education
Information
Advocacy
Connections
To organize, conserve and develop ethical, profit - making and growing work in favour to their clients.
Vision Statements
The Transportation Intermediaries Association is a very strong and unified association in North America as third-party Logistics Company which celebrates the individual disciplines of their members while speaking with one voice to shippers, carriers, government officials and international organizations.
In terms of growth and profit also TIA is helpful in third party logistics professionals for better management of the company.
TIA does all these things by:
Promotion of high ethical quality for use by the expert’s 3PL company.
Development of top exercises to increase and safeguard value of shareholder.
Promotion of the usefulness of Transportation Intermediaries Association members by the carriers and the shippers.
Maintenance of a powerful and developed association which can pursue in meeting the requirements of TIA members and the organizations.
SOURCE: http://shippio.com/wp-content/uploads/2016/05/bifa.jpg
15. BIFA - British International Freight Association
The British International Freight Association is a non- profitable organization. It is the trade association for United Kingdom - registered organizations occupied in international freight movement by different modes of transport like rail, road, sea and air. BIFA members trade under a nationally accepted set of Standard Trading Conditions that are backed in the insurance sector.
Approximately 1500 corporate members are linked with BIFA which are known as freight
Forwarders mostly and they offer a wide range of services. BIFA is funded and run by its members Only.
The association provides:
1. Representation - British International Freight Association makes sure that the opinion of their members are properly represented and listened.
2. Training and Development- also provides on job training or industrial training to all the international traders just not only to the members of BIFA. Many courses such as custom procedures, dangerous goods, security, import/export etc. are their throughout the year in various locations all around the United Kingdom.
3. Industry Promotion gained with consistent involvement at industrial trade fairs all around the United Kingdom.
4. Information and Guidance on Technical Matters
SOURCE:
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16. FTA - Freight Transport Association
The Freight Transport Association is one of the largest trade associations and it is based in Tunbridge Wells in the United Kingdom with members moving goods by road, rail, sea, and air.
Its motive is to present the opinion and views of more than 13,000 organizations from the transport industry starting from household names to medium and small business and large multinational companies. All the members of different modes decide the policy of FTA, from its quarterly regional and national councils.
National Councils are comprised of:
1. The British Shippers Council 2. The Rail Freight Council 3. The Road Freight Council
4. The Freight Council
SOURCE:
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17. FFFAI - Federation of Freight Forwarders’ Associations in India
FFFAI which stands for Federation of Freight Forwarders Association in India is the famous association which is representative of 24 members in pan India. This association represents approx. more than 5000 custom brokers as well as freight forwarders. They have employed more than 1 lakh people which are working under the organization. This association is having a control on more than 90% of India’s total international logistics business.
Achievement
In International Customs day held in 2013, FFFAI was recognized with world customs organization and they were also given the certificate of merit for their involvement to the logistics.
People linked with FFFAI who received the recognition:
Late Mr. M K Ghosh – Former Chairman of FFFAI Mr. Nailesh Gandhi – Former Vice Chairman of FFFAI Mr. Naval Mehta – Advisor of FFFAI
Education and Training
FFFAI also provides training to their members so as to improve the knowledge of their and skills which results in increasing the quality of personnel indulged in this business. Indian Institute of Freight forwarding is the education institute of FFFAI where education is provided to their members. In freight forwarding there are six months part time diploma courses that are recognized by FIATA. 5 batches of this freight forwarding diploma course have been successfully completed and results have been very good as students have been placed in very good organizations. Training workshops are also held by FFFAI to develop skills.
FFAI Forecast:
To build customs broker as first choice for profession
To change the freight forwarding business as an important profession
Integration of Supply Chain Professional as not just a Logistics Expert but also as a Key Stake Holder and as a Central Nervous System of Planning and Execution
Aim of FFFAI:
Licensing to self-regulation migration
Providing global thought leadership
Undertaking the activities of public relation
To promote brand image and build the confidence of public
In policy direction they be the voice of change which can help them to get worldwide recognition.
SOURCE: https://pbs.twimg.com/media/DFF2azUVoAA7dYS.jpg
18. Brihanmumbai Custom Brokers Association
BCBA which stands for Brihanmumbai Custom Brokers Association is an organization of Custom house Agents which have been licensed by the Commissioner of Customs, Mumbai under the Act 1962. Brihanmumbai Custom Brokers Association was started in 1937 and in India it is the largest Custom House Agents' Association which is having a force of more than 1600 members.
The headquarter of this association is at 73/74 C Mittal Towers, Nariman Point, Mumbai, India.
With the change of time the role of Customs house agent has also changed very much. Earlier they were a type of clearing agent but in today’s time Custom House Agent is a total global logistics provider.
BCBA continuously focus to help and improve the quality of service of their members. To achieve this motive, they continuously focus on:
Promoting and increasing the interests of the Custom House Agents in many matters like
Inland and Foreign Trade
Shipping and Transport
Banking
Warehousing
Insurance and allied subjects
Provides training and keep their members up to date
Developing the capability to serve to their customers and survive with the global competition
Making all the members at same place by making a common platform for them and making them discuss the challenges and issues with governmental bodies and other partners of trade business.
19. Summary
A large number of organisations are operational in cargo & freight industry whether it is operational at country levels or international levels. All these organisations are formed according to specialized area or general operational area. These cargo or freight related organisations work for the benefits of the stakeholders. A large number of organisations such as IATA, ICAO, ULD Care, FIATA, TIA and FTA, TIACA are present at international level and organisations such as Federation of Freight Forwarders’ Associations in India and The Indian Institute of Freight Forwarders at domestic level. And surely, the role of each organization is significant for the cargo
& freight sector.
