Learn what are the responsibilities of a shipping agent

  • 10/03/2020
  • 9 minutes

It is undeniable that a shipping agency handles different assignments, don’t you agree? Because of this, many professionals working in the area have doubts about what are the true responsibilities of the shipping agent.

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After all, what is the scope of these professionals? What are the limits and priorities of those who perform this function? To answer these and other questions related to the topic, we prepared this content. Follow it through to the end to learn more!

What are the responsibilities of the shipping agent?

In order to prepare this article, we talked to two specialists: Rafael Chor, a lawyer that specializes in shipping agencies, and Fernando Porto Filho, a lawyer at Shipping Consulting.

In Chor’s view, a shipping agent’s primary responsibilities are to fully meet the needs of their customers and to keep an eye on legal changes that may impact the ship’s operation. “It is necessary to ensure that the ship will stay as little as possible at its scale, representing the lowest viable cost for the operation,” he explains.

According to Porto Filho, the shipping agent is a mandatary of the shipping company. In performing this role, such professional has the obligation to take the necessary steps to enter the respective vessel at the port of call, as well as the permanence and departure, always in accordance with the orders received and/or specific authorization. They must also send the necessary information to the authorities involved, in compliance with the applicable law.

“The responsibilities of the shipping agent are those that are established in the contract between them and the shipping company. In this document, it should be clear that this agent is authorized to work by order and on behalf of the company that hired them,” says Porto Filho.

Although it is a mandate agreement, the relationship between the shipping company (client) and the shipping agent (mandatary) is often carried out simply through the exchange of messages. Thus, it is incumbent upon the shipping agent, in their performance, to always proceed in accordance with the duties established in the Brazilian Civil Code, in articles 667 to 674, namely:

  • loyalty;
  • obedience;
  • diligence;
  • information;
  • execution;
  • accountability.

It is worth remembering that, in 2017, the Baltic and International Maritime Council (BIMCO), the world’s largest shipowner association, in partnership with FONASBA (The Federation of National Brokers and Agents), launched a standard contract template for shipping agency services. As it is a basic mold, it can be used for any kind of agreement between the parties.

How has this activity changed over time?

Chor mentions that the shipping agent’s responsibilities have evolved over time. “If we go back to the early days of this role, what we have as initial records, the professional who is now called a shipping agent was an employee of the shipowner,” he says. Not for nothing, it was customary for the agent to reside in a location near the point where the ships of a particular shipowner docked. Thus, it was easier and faster to offer ship services to the contracting company.

Shipping agents are independent of shipowners, establishing themselves in numerous locations and performing various services for their customers. As a result, shipping companies have given the shipping agent more functions.

From a general perspective, Porto Filho says that despite the changes, the main work of the shipping agent has stayed the same, because it remains linked to the entry, stay, and exit of the vessel from its port of call. “However, the control systems developed by the authorities are constantly evolving and this requires a higher level of expertise from shipping agents,” he contextualizes.

With regard to contractual liability, the shipping agent still has the same obligations as always, performing the role of mandatary of the shipping company.

What are the prospects for the future of the activity?

The role of the shipping agent, as in other areas and with different functions, has been undergoing a revolution — all thanks to the digital transformation experienced by the world in recent decades, which can be well summarized by the concept of industry 4.0.

“The gains related to agility and service have been impressive, because they follow a line of more efficiency and lower costs, points highly valued by the foreign trade market,” says Porto Filho. In addition, as the shipping agent is well aware of the ports where they operate and the usual needs of customers in each location, this great versatility leads to a promising future.

For this expectation to be fulfilled, the professional must constantly seek specialization. According to Porto Filho, this is largely due to the continuous evolution of legal requirements and the increased speed of port operations. That is, this professional will remain indispensable both due to their legal knowledge and to the peculiarities of each port.

Why are shipping agents so important? What are the biggest reasons for hiring them?

For Chor, the hiring of a shipping agent is indispensable, because this figure carries a vast knowledge about different locations of operation, besides understanding the legal norms and documentation procedures to be fulfilled by the transporters before the governmental agencies for berthing and unberthing of the ships, for example.

“This professional is able to provide the best service to the needs of vessels (speedboats, practice, ranch etc.), not to mention the knowledge of port conditions — climatic, structural, and tidal,” says the expert.

According to Porto Filho, such hiring is essential to avoid possible complications. With the evolution of commerce and the need for integration and cost reduction, the role of the agent gained more importance than it already had. “The hiring of suppliers and the increasing demand from the authorities (IRS, Federal Police, Anvisa, and the like) for information exemplifies this very well,” he comments.

All in all, the responsibilities of the shipping agent are not few. In any case, it should be noted that the function is fundamental in the context of foreign trade, because it brings several attributions together.

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