COVID-19: updates on DACHSER’s operations in China and Korea

Current loading restrictions in Europe due to COVID-19

In the following you will find the current loading restrictions that apply to Europe (see download). Food transports are excluded from this. This document here will be updated on a regular basis.

With the free map of the software provider Sixfold, transport companies and truck drivers can view the current waiting times at European borders and make appropriate preparations if necessary: https://covid-19.sixfold.com/

APAC countries signed world's largest free trade agreement

On November 15, 2020, leaders from 15 Asia Pacific nations came to an agreement to form a free trade bloc under the Regional Comprehensive Economic Partnership (RCEP). The agreement is intended to facilitate trades among the member countries by removing tariffs and stimulate the economy amid the COVID-19 pandemic.

Main points at a glance:

• RCEP is a free trade agreement in the Asia-Pacific region.
• Fifteen countries signed the agreement including Australia, Brunei, Cambodia, China,  Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, South Korea, Thailand, and Vietnam.
• With the participation of the 15 countries, they have formed the world's largest free trade zone, covering about 30% of the world's population and nearly 30% of global GDP.
• China’s presence notably increases the impact of the agreement and boosts the total GDP of the RCEP member countries.
• India did not join the partnership over concerns that cheap import products might pose a harm to local producers.
• The new free trade zone is bigger than the US-Mexico-Canada Agreement (USMCA) and the European Union.
• The RCEP will reduce taxes on most goods over a 20-year period, streamline customs procedures, regulates the field of intellectual property and digital trade and replace a number of bilateral trade agreements in the region with one set of rules.
• Some benefits are expected to be seen in 2021 once participate nations complete their domestic ratification procedures.

What does it mean to the global supply chain?

• The RCEP is expected to eliminate a range of tariffs and quotas on most of the goods traded within the region over a 20-year period.
• The "rules of origin” may have the biggest impact. Under RCEP, parts from any member nation would be treated equally, this gives companies in RCEP member countries an incentive to look for supplier within the region.
• Many of the RCEP member countries already have bilateral free trade agreements between each other, RCEP would streamline the various overlapping preferential terms. This reduces complexity and reduce costs for businesses.
• China, Japan and South Korea are the traditional key players for electronics, automotive, textiles and garments industries, having them in the RCEP would ensure supply chain stability to ASEAN countries.
• It gives an incentive for companies to look for supplier within the RCEP member countries, thereby laying the foundation for enabling an accelerated GDP growth within the region.

As RCEP will further fuel the ongoing manufacturing shifts within Asia, it not only affects companies within the member countries but is also relevant to any companies worldwide who have business in the region.

Feel free to reach out to us at dachser.apac-asl@dachser.com to know more about the new free trade agreement. Together we can review your current supply chain locations and identify steps to grasp the greatest benefits under the impact of RCEP.

Incoterms 2020 updates

A new version of the Incoterms will take effect on January 1, 2020, and will include a number of changes. The terms of delivery issued by the International Chamber of Commerce regulate essential buyer and seller obligations in international trade, such as transfer of goods to the buyer, transport costs, liability for loss of and damage to goods, and insurance costs.

With the adaptation of the Incoterms 2020 to current global trading practices, the new version is very up-to-date and practice oriented. The aim of the revision was to make the Incoterms clauses more user-friendly. For example, their presentation has been revised to make it easier for users to select the appropriate clause. In addition, the order of the clauses has been changed, and revised user instructions have been added to each clause.

In terms of contents, significant changes have been made to the Intercoms 2010, in particular the following:

• Different coverage levels in CIF and CIP: As in the past, the seller is still obliged in the Incoterms 2020 to take out transport insurance at their own expense in clauses CIF (Cost Insurance Freight) and CIP (Carriage Insurance Paid). In contrast to the Incoterms 2010, however, the two clauses now provide for different minimum coverages. The minimum coverage to be observed when the CIF clause has been agreed remains unchanged. The transport insurance to be taken out by the seller must continue to at least correspond to the coverage in accordance with the (C) clauses of the Institute Cargo Clauses or similar clauses (insurance of named risks). If the CIP clause is agreed, the seller must now provide insurance coverage in accordance with the (A) clauses of the Institute Cargo Clauses (all-risk coverage). Both the CIF clause and the CIP clause allow the parties to the contract to agree on insurance coverage that differs from this.
• Inclusion of security-related requirements: Security-related requirements for the transport of goods have now been included in Rules A 4 and A 7 of each Incoterms 2020 clause. As with other the Incoterms clauses, it should be noted that the Incoterms clauses only directly apply to the parties to the sales contract and are not the subject of the contract of carriage.
• The Incoterms 2020 contain regulations for transporting with one’s own means of transport in FCA, Delivery at Place (DAP), Delivery at Place Unloaded (DPU), and Delivered Duty Paid (DDP).
• For goods sold under the FCA (Free Carrier) clause and intended for sea transport (such as goods in containers), FCA is stipulating a new option in the future. The buyer and seller may agree that the buyer shall instruct its freight carrier to issue an on-board bill of lading to the seller after the goods have been loaded. At the same time, the seller is obliged to hand over this on-board bill of lading to the buyer. This is typically done through participating banks.
• Renaming of DAT to DPU (Delivered at Place Unloaded). According to the Incoterms 2010 DAT clause, the seller delivered the goods as soon as they were unloaded from the means of transport at a “terminal.” However, according to the Incoterms 2010 application notes, the term “terminal” was not to be understood from a technical point of view but meant any unloading location. This fact was taken into account in the Incoterms 2020 by renaming the previous DAT clause to DPU (Delivered at Place Unloaded) for the sake of clarity. That means that in the future, any (agreed) place can be the place of destination.
• The Incoterms apply between the parties of a (national or international) sales contract and address – but are not limited to – special rights and obligations within this contractual relationship. On the basis of a uniform definition guaranteed in this way, subsequent problems of interpretation or discrepancies between the parties to the sales contract are to be avoided. It should be noted that the Incoterms, due to their character as GT&C-like provisions, do not constitute statutory provisions and thus only become legally binding if they have been effectively agreed between the parties to the sales contract by means of a corresponding reference (for the Incoterms 2020, this is also possible before 1/1/2020). Irrespective of this, in individual cases conflicting statutory provisions still take precedence over an Incoterm clause.

The Incoterms were revised by 500 experts from more than 40 countries.The clauses are recognized worldwide and are in use in more than 30 different languages.