IATA, FIATA near agreement on agency modernization

  • Randy Woods
  • December 24, 2015
  • News

IATAAs the end of 2015 draws closer, so too do the two major air cargo associations regarding a solution to an impasse over how to modernize the cargo agent-carrier relationship. The main sticking point between the International Air Transport Association (IATA) and the Fédération Internationale des Associations de Transitaires et Assimilés (FIATA), representing forwarders, is essentially whether to make IATA’s payment settlement system mandatory.

After more than three years of debate over the joint Cargo Agent Modernization Program (CAMP) to better define the roles of each party, both IATA and FIATA have recently made some progress, including a recognition by IATA that forwarders will no longer be considered mere “agents” of air carriers and are now “principals” that can work independently with shippers as customers of the airlines.

The remaining roadblock in the CAMP discussion is IATA’s Cargo Accounts Settlement System (CASS), which makes the payment system between both groups more efficient and eliminates the cumbersome need for forwarders and cargo carriers to sign bilateral deals. IATA wants CASS to be the mandatory global standards system, but many forwarders – especially small- to medium-sized ones – have objected, saying they have no say over how the IATA-created payment system is implemented.

“Forwarders seem to appreciate the efficiency that a collective billing and remittance platform affords,” said FIATA in a prepared statement. “It is, however, FIATA’s view that a forwarder’s decision whether to sign up to the CASS Participation Agreement with IATA should be made independently by each individual operator, and not be mandated by the FIATA/IATA agreement as a condition to participate.”

Rudi Sagel, chairman of FIATA’s Airfreight Institute, said the group’s constituents want a program “based on the independence of each party in contract, allowing participants a reasonable freedom of choice on how they wish to handle their financial arrangements, either individually, bilaterally or multilaterally.” Recognizing such an arrangement, he added, “would bring IATA’s CASS up to a level that modern technology allows today and obviously was not available in the past.”

During a recent press conference following talks with FIATA, Glyn Hughes, IATA’s global head of cargo, remained upbeat. “We have concluded what we feel is the bulk of a really valuable discussion,” he said, adding that, “we have not agreed on everything as that would be unrealistic because we represent different constituency groups.”

While both groups will move forward on implementing portions of CAMP that have been mutually agreed up, each will take part in internal discussion over the New Year’s break to find a way to hammer out an agreement over the CASS debate.

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