Conflict of lien laws relating to the sale of abandoned goods carried by multimodal transport in Ethiopia

Abstract

Background: Inland dry ports in Ethiopia serve as extended destinations for goods transported by sea, especially under the international multimodal transport system, to fulfil customs formalities. Ethiopia’s multimodal transport law gives carriers lien rights to detain cargo and documents to recover all sums payable under multimodal contracts. However, the country’s customs law gives customs the right to sell abandoned goods by auction and collect duties and taxes before any other payments are made.

Objectives: This study critically examines current regulations and practices relating to carriers’ lien rights to recover uncollected charges on goods abandoned at inland dry ports.

Method: A qualitative case study design is used to analyse the challenges and provide solutions for multimodal transport operators dealing with abandoned goods at inland terminals.

Results: A major reason for abandonment is that the proceeds of sales of abandoned goods are insufficient to pay for taxes and logistics expenses. The Ethiopian Shipping and Logistics Services Enterprise has lost an estimated 1.5 million USD annually from abandoned containers in multimodal transport.

Conclusion: Based on the legislation and court of appeal precedents presented in this paper, multimodal transport operators’ uncollected charges should take priority over tax and duties for the proceeds of selling abandoned goods. As Ethiopia is a landlocked country, it needs to resolve this issue to ameliorate its multimodal transport system.

Contribution: This paper suggests revising existing regulations and practices relating to unclaimed goods at inland terminals to recoup logistics costs ahead of tax. This will facilitate multimodal transport services’ use of inland terminals as extended destinations of seaports.