AUTOGATES PRE-ADVICE INDUSTRY WORK GROUP POSITION PAPER Version

AUTOGATES PRE-ADVICE: INDUSTRY WORK GROUP: POSITION PAPER: Version 1 14 August 2009 version 1 1

Contents q Introduction and context q Industry approach q Objectives, deliverables and Work Group scope q Work group recommendations q Way forward 2

Introduction and context q TPT is in the process of introducing automated gates at their container terminals with the view to ensuring that these facilities/services contribute positively to optimal road/terminal interface and reduced vehicle processing times q In order for automated gates to justify the considerable investment and contribute optimally to the container supply chain fluidity it is TPT’s intention to make the pre-advice of export containers prior to arriving at the terminals’ gates mandatory q During TPT’s bilateral engagement with Shipping Lines and Industry forums the general consensus was that the pre-advice of export containers is critical to deriving the optimal benefit from the automated gates q The identification and assignment of roles and responsibilities together with the practicalities of routing information flows remain a challenge q The introduction of TPT’s new Terminal Operating System (NAVIS), fortunately presents opportunities for potential solutions in this regard q In order to effectively design and implement the required pre-advice business 3 process it is critical that a holistic Industry approach be adopted

Industry approach q In order to ensure that workable pre-advice export business processes with clearly defined roles and responsibilities are developed and implemented as a matter of urgency, TPT approached SAASOA, SAAFF, Harbour Carriers division and Warehousemen to participate in an initiative to develop the required business processes q The content of this document is a direct output of the work group constituted from the above stakeholders q SARS were requested to participate in this initiative with the view to ensuring alignment with future SARS strategy/legislation/ business processes and computer systems. During a bilateral engagement between TPT and SARS, it was agreed that SARS would participate in this initiative as an observer. This approach was supported by SAASOA and SAAFF q This draft document does not reflect any input from SARS at this point in time. q Once the document has been ratified by the working group’s principals it will be made available to SARS for input q Refer to Appendix “A” for the work group members 4

Objectives, deliverables and Work Group scope q Objectives and deliverables of work group Ø To agree and sign off on the business pre-advice process option (s ) Ø To develop practical pre-advice information process flows for the agreed and signed off business pre-advice process option (s) that will facilitate achieving maximum benefit for the container supply chain Ø The agreed business process pre-advice options to be referred for Legal review in order to ascertain risk and liability implications q Work group scope: Ø Rail ex City Deep & Private sidings: Taken care of not part of this work group Ø Inter Terminal Transhipments: Taken care of, Shipping Lines to pre -advise pre-and on-carriers, not part of this work group Ø Empty container shipments Ø Pre-packed staged containers (I. e. depots and packing stations) Ø Major Shippers 5 Ø Small Shippers

Work Group recommendations q Key principles q Critical Success Factors q Proposed pre-advice business process options and information flows q Go to market strategy 6

Key principles q The following key principles were agreed to: Ø Pre-advice of export containers will be mandatory Ø Pre-advice information (Booking reference, container number, seal number and container weight) to be provided preferably by EDI but could be webbased. Ø The Shipper (Packing point) is responsible for the source and generation of information Ø The pre-advice function can be performed by various parties, as is the case with the current CTO system, including the following: Ø Shipping Lines Ø Shippers Ø Container Depots Ø Clearing and Forwarding Agents Ø Trucking companies Ø 3 rd party pre-advice service providers Ø The aforementioned parties pre-advise TPT on behalf of Shipping Lines provided they have been authorised/ accredited by the Shipping Lines Ø Given that TPT only has commercial relationships with Shipping Lines, the responsibility for the correctness of the information lies with the Shipping Lines , as is the case with the current CTO system Ø The to be agreed on pre-advice business processes to be subject to legal 7 review

Critical Success Factors q The following critical success factors were agreed to: Ø TPT establish business processes/systems that will allow multiple parties to pre-advise (see previous slide) Ø TPT to ensure that the pre-advice business processes/systems have the necessary information security ( The pre-advising party may only have access to/ visibility of the units that it is pre-advising) and adequate audit trails ( Parties pre-advising, information being pre-advised and subsequent amendments being made are identifiable) Ø TPT to ensure that an interim solution is put in place and maintained to facilitate the acceptance of containers into all container terminals. Ø In order to ensure that the interim solution does not undermine the objectives of pre-advice end state the interim solution must have a defined lifespan Ø The CTO will remain in operation for containers pre-advised at the interim facility ( No faxes and e mails to be used as pre-advice instructions) Ø The current CTO paper based process to be replaced with EDI/WEB as an end state Ø The interim pre-advice facility needs to be off-site from the Container Terminals to ensure that pre-advising is not performed at the terminals whilst the trucks are queuing Ø Industry to agree on a date for pre-advice to be mandatory Ø Go to market strategy has to be implemented as an Industry initiative 8

Proposed pre-advice business process options and information flows: Effectively resulting in all containers being pre-advised using any of the 3 pre-advice options Can the packing Point pre-advise TPT? Yes No Shipping Line to Authorise this party Shipping Line To pre-advise Packer Pre-advises TPT Directly using WEB EDI Packer presents Information to Shipping Line During working hours Shipping Line Pre-advises TPT Directly using WEB EDI 1 year ? Life span Pre-advice Performed using TPT interim Pre-advice facility 9

Go to market strategy q Direct pre-advice value proposition (“What’s in it for me? ”) packaged highlighting following benefits: Ø Cost effective business process using EDI/WEB Ø CTO no longer required Ø Transporter not disadvantaged having to wait for cumbersome pre-advice process before proceeding to the Container Terminal q A go to market strategy to be developed for the following target market segments in order of priority: Ø Empty container shipments (I. e. Depots) Ø Pre-packed staged containers (I. e. depots and packing stations) Ø Major Shippers Ø Small Shippers Ø Pilot projects to be accelerated with an Industry “go to market” strategy Ø Objective is to have 80% of volumes pre-advised by 1 April 2010 q Interim pre-advice service offering/facility to be packaged highlighting the following “hassle factors” : Ø Paper based with CTO remaining in force Ø Costly business process in that it is time consuming and likely to attract a service fee going forward Ø Transporters disadvantaged having to wait for cumbersome pre-advice 10 process prior to proceeding to the Container Terminal

Way forward The key elements of the way forward are: q TPT/Industry, represented by work group, to agree and sign off on the business pre-advice process option (s ) q Development of practical pre-advice information process flows for the agreed and signed off business pre-advice option (s) q Agreed pre-advise business options to be reviewed from a legal perspective q TPT/Industry go to market strategy to be launched: Ø Pilot projects to be accelerated with an Industry “go to market” strategy Ø Industry to agree and declare a pre-advice mandatory date i. e. the implementation of “proposed pre-advice business process options and information flows as per slide 9” Ø Objective is to have 80% of volumes pre-advised by 1 April 2010 11

Appendix “A”: Work group members Name Representing Natasha Vaughan SAASOA Thomas Eckert SAASOA Paul Scannell SAASOA Ashley Govender SAASOA Dave Watts SAAFF Jacques de Villiers SAAFF (Warehousemen) Malcolm Sodalay SAAFF (Harbour Carriers) Michelle Phillips TPT Moshe Motlohi TPT John Hyde TPT Mark Wootton TPT Tshwaelo Matlhape TPT Previn Govender TPT Sidney Bird TPT 12