The contract between Thanh Hoa shipping company and its Tanzania partner, Mohammed Enterprises shows that the receiver of the missing rice shipment is responsible for its goods once loaded, said Thanh Hoa’s director. In attempts to clarify the dispute which led to the seizure of an unrelated Vietnamese ship in Tanzania, Thanh Hoa Co in Mekong Delta’s Tien Giang province recently unveiled the details of the rice shipment contract with its Tanzania partner.
According to the CF (Cost & Freight) contract between the two companies, signed in September 1999, “Thanh Hoa is responsible for the goods and the ship itself while Mohammed Enterprises is responsible for taking out insurance. Thus, as the sellers, Thanh Hoa is not held responsible after the goods are loaded on the ship,” said Pham Van Tu, director of Thanh Hoa.
The dispute started when Thanh Hoa’s shipment of 6,000 tonnes of rice worth some 1.4 million dong to Tanzania’s Mohammed Enterprises in October 23, 1999 never reached its destination. Mohammed Enterprises demanded Thanh Hoa pay for the losses and appealed to Vietnamese relevant agencies and to the Tanzanian court, but Thanh Hoa refused saying the contract between the two companies held the Tanzanian company responsible for the goods once loaded onto the ship.
On July 27, 2004, a Tanzanian court ordered the seizure of Can Gio Ship and its 12 crew members, which were in no way related to Thanh Hoa, once it berthed at the African country’s Dar Es Salaam Port. For more than three months, the ship, owned by Vietnamese-Danish joint-venture SEA Saigon based in HCM City, and its members have been held by Mohammed Enterprises.
The Tanzanian enterprise wants to force its Vietnamese partner to repay money it says is owed to them although Can Gio Ship has no interest in the case, said Tu.
After the contract was signed, Tu said his company asked the Vietnam Ocean Shipping Agency (VOSA) to lease the Luna Brisa Ship for the shipment. “We informed our Tanzanian partner of the ship’s name and loading schedule, and the Tanzanian company then sent its staff to Vietnam to directly supervise the loading of goods at a port in HCM City,” he said.
However, Thanh Hoa had to keep the ship at port for 10 days after loading because Mohammed Enterprises did not take out insurance, said Tu. Both Thanh Hoa and VOSA staff introduced the Tanzanian company to the Vietnam Insurance Co (Bao Viet), but “our Tanzanian partner refused to sign an insurance policy with Bao Viet as it said the insurance was too high,” he said.
“We decided to keep the ship at dock for 10 days and informed Mohammed Enterprises of the action,” said Tu.
“After the Tanzanian company had not sent any news regarding insurance, the ship departed October 23, 1999 – 11 days after sitting idle at the port,” he said. He added that Thanh Hoa did not know that the ship had left the dock.
When the ship did not reach its destination, “we asked Interpol Vietnam to search for the ship, but it failed to find it,” said Tu.
The director also confirmed that his company had not received payment from the Tanzanian company. “Under a signed contract, the Vietnam bank will request the foreign bank transfer the payment after the delivery of goods is completed,” said Tu.
When Mohammed Enterprises did not receive the shipment, the company lodged a petition to Vietnam’s Ministries of Trade and Foreign Affairs and even to the prime minister.
On January 14, 2003, the Arbitrator Committee of the Vietnam International Arbitrator Centre rejected the petition from Mohammed Enterprises concluding that the Tanzanian company did not comply with the procedural rules under Vietnam’s Trade Law.
“The distance between Vietnam and Tanzania is 4,669 nautical miles. The Luna Brisa Ship left the HCM City port on October 23, 1999 and was scheduled to deliver the goods to the receiver at Dar Es Salaam Port on November 11, 1999 at the latest,” Tu quoted the arbitrator committee as saying.
But, “the complainant (Mohammed Enterprises) must make a legal action between November 11, 1999 and November 15, 1999 according to the procedural rules of Vietnam’s Trade Law,” said the arbitrator committee as quoted by Tu.
In reality, the Tanzanian company lodged a petition on July 6, 2002.
The government Office later issued a document regarding the prime minister‘s instruction for the case. “The contract dispute will be settled in line with international commercial rules,” the PM said in the document.
Currently, the Can Gio Ship and its 12 members have lodged pleads to relevant agencies to help rescue them. The Tanzanian court has reportedly conducted five trials so far to decide the case, but failed to find legal evidence for the seizure. The court has delayed further trials on the false pretense that the Can Gio ship has a fake shipping license.