As I write this editorial, we have just experienced a major snowstorm on the U.S. East Coast. It seems like it came early this year, but the official start of winter is just days away. The weather is transitioning, and it mirrors the transitional period in which we find ourselves. Our business continues to make steady improvements as shipment counts increase slightly. However, we face many challenges with rates and space issues, as well as equipment shortages and port congestion. COVID hospitalizations and deaths are at record levels in the U.S., yet vaccine approvals and subsequent rollouts are starting. We remain careful and cautious. There is hope, and we remain optimistic for a return to normal or should I say the “new normal.”
Evidence of this optimism is in the budgets that we have received from all of our U.S. branches and our global EMO companies. EMO is staged to emerge in a post-COVID period as a stronger, more resilient organization. Sometimes things stay the same until we are forced to change them. We are now more streamlined and paperless, and we are connecting virtually through Zoom and Microsoft Teams. Thanks to all of you for your hard work, cooperation, and loyalty during this difficult period, and I extend a special thank-you to all EMO U.S. Corporate staff. I might be biased, but I believe Corporate is the foundation and the “glue” that keeps it all going behind the scenes.
My thoughts and prayers go out to all who have suffered with COVID. It is heartbreaking to see how this pandemic has affected so many. It is difficult to watch the long lines of people waiting for food giveaways. Yet, I have heard of so many stories of our employees selflessly giving to those who are in need. The Board of Directors of EMO USA made the decision to make a substantial donation to Feeding America, a reputable organization. This money has been earmarked to help deliver food directly to the areas where we have U.S. branch locations.
Personally, it has been a difficult period as we all make sacrifices, but there has been much joy also. Sue and I became grandparents again as our middle daughter Elizabeth and her husband Brian had their second child Evelyn in September 2020. She joined her brother Thomas, who was born in 2019. We will continue the pattern of one grandchild a year as our oldest daughter Kathryn and her husband Ryan are expecting a child in July 2021. In addition, our youngest daughter Allyson just became engaged to her fiancé Keith. We have a lot to be grateful for!
I want to wish you all Happy Holidays and a Happy, Healthy and Prosperous New Year!
Executive Vice President and
Chief Financial Officer
It is in the holiday spirit that I want to express my sincerest appreciation to the EMO Trans global staff, our loyal customers, and trusted partners for the mutual successes we have achieved thus far. I look forward to the new year with a positive outlook as we continue to deliver exceptional service and together build and further develop our business relationships for a prosperous 2021.
I wish you and your loved ones a very Merry Christmas, Happy Holidays and a healthy New Year.
EMO Trans Vietnam closed the year of 2020 with successful performance and safety with a trip to Phu Quoc Island (far south of Vietnam). The office sends good wishes for a Happy New Year and Merry Christmas to all EMO Trans families and customers worldwide. Pictured left to right, the office staff; office staff and family.
Marvel has Wonder Woman, Black Widow, and other female superheroes battling over the enemies. Here in EMO Trans Philippines, we have our own version! We are proud to have an all-female team unfazed by the challenges of the pandemic and always on-the-go. We are very pleased with the growth from the Philippines office in our first year. The team, led by Gloria Legaste, has been able to battle through the COVID situation and continue to keep our customers happy while growing business. Our Philippines Data Center has also been a huge success.
EMO Manila pictured left to right: Nina Bautista, Grace Hernandez, Lej Mendoza, Chi Agno, Majoy Rodejo, Maricel Franco, and Glo Legaste.
John Boskey joined Atlanta in Air Export Operations. Seattle welcomed Marion Antonio to its Import Operations team. Detroit welcomed Nicole Soblo to its Ocean Import Operations team.
Uwe Kaeding Retires After 22 Years with EMO Trans
Anyone who has known of EMO Trans for any length of time has probably heard of Uwe Kaeding. A dynamic leader and enthusiastic colleague, Uwe has been responsible for a significant amount of business development in the organization. He writes, “Dear colleagues, customers, vendors, and friends, after spending my whole professional career in logistics, the time has come for me to consider some other values of life. I have spent the last 22 years of my career with EMO Trans, Inc. in different positions: first, Regional Manager, Midwest, then adding the West Coast to it with a VP title, and then VP, Airfreight Procurement. It has been a great pleasure to work directly with Jo Frigger, our Chairman, and I cannot imagine having a better boss in life. Always fair, direct without politics, and very knowledgeable and well-respected in the industry.”
He adds, “Those of you who know me a little more closely know that I have gone through some rough stretches in my private life over the last few years and, therefore, will better understand my decision to retire by the end of this year. Now it’s time for relaxing, enjoying our home in the wilderness in northern Wisconsin, and hopefully soon the door to allow traveling in the world will open again. There are still quite a few items on our bucket list. So, thank you to all who worked with me, supported me, and became friends. I will miss you and likely also the work that I enjoyed so much. All the best!”
Jo Frigger, EMO Trans’ Chairman, extended his best wishes to Uwe: “My profound thanks and appreciation for your 22 years of loyalty and successful contributions to the entire EMO organization. In addition to developing the Midwest region and some of the West Coast area, you have brought a number of very capable people to our company. While we wish you a long and healthy retirement, we also know that we will miss you and your participation in the group. It saddens me, that under the current virus conditions, we cannot organize a proper party to say goodbye to you. But we will do so next year once the world returns to normal conditions. So, for now, all the best and our thanks also to your wife Janet. Enjoy the more peaceful times.”
In light of the pandemic, Uwe's colleagues had to hold a virtual Zoom celebration. Also pictured: Uwe's home in northern Wisconsin.
EMO Trans Australia Moves into New Centrally-Located Office in Sydney
The Sydney office is pleased to announce its move into a new building that will give the branch greater opportunities for the future to further develop partnerships with clients and offer a wider range of warehousing services. “We are now more centrally situated to our client base, and the facility is double the size we previously had,” explains Managing Director Duncan Smith. “Access to key transport routes is at our doorstep; the intermodal terminal is less than 1km away, and we are equidistant between Sydney’s current and new airport (which is under development).”
The new address is:
2 Greenhills Ave, Moorebank, NSW 2170, Australia
Phone: +61 2 9693 9900
EMO Malaysia Expands into New Office in Klang City
EMO Malaysia has doubled its office size and moved into a new location in the heart of Klang City. Managing Director Yung Tan says, “We believe this new location will enhance EMO Trans’ image in Malaysia. We are looking forward to continued growth in the near future.”
Tom Bayes, VP Business Development Asia, adds: “In the first four years that we have opened EMO Malaysia, it is amazing to see its growth as well as the need to move to a larger facility that is twice the size of our former office space. The entire Malaysia team has worked very hard at continuing to grow our Malaysian market share despite the 2020 circumstances with COVID and market conditions. We are not slowing down anytime soon!”
The new address is:
No. 5-13, MTBBT2, Jalan Batu Nilam 16, Bandar Bukit Tinggi 2,
41200 Klang, Selangor Darul Ehsan, Malaysia
Tel: +603-3322 1668
Fax: +603-2726 8882
"Little Houston" in Germany Excels in Oil and Gas Sector
Patrick Radtke, Route Development Manager - USA Southwest/Midwest/West Coast provides this addition to EMO Trans' expertise in the oil and gas sector.
"In our last newsletter, we presented you the city of Houston and its efforts in the oil and gas sector. This time, we would like to build on and introduce you to a city that describes itself as “Little Houston." It's Celle, a town in Northern Germany close to the capital city of Hannover in Lower Saxony. It is the birthplace of the global oil and gas industry. Even though international tourists haven't quite discovered it, the city itself is very lovely and has a lot of charm with its over 500 old traditional half-timber houses and a beautiful old fairytale castle.
If we believe the history books and when talking to the people in Celle, everything started here at the beginning of the 19th century or even earlier, when they first pulled the “Texas Tea” by hand. In 1858, the first drilling took place, and the story began. At the beginning of the 20th century, hundreds of oil rigs towered into the sky around Celle, which at that time made the area look like a little Texas.
Over the years, more and more well-known oil companies have established headquarters in Celle, so that one in three jobs in the city is now still related to the oil and gas business. Besides the big players, the industry of Celle is formed by many other small or midsized companies, who directly or indirectly act as a supplier for these companies.
EMO Trans is proud to call many of these suppliers and some of the big accounts to its long-standing customers in this sector for many years. With our office in Hannover, which is only 50 km away, we have held a very close relationship with our clients and can even act on short notice with an integrated 24/7 service. The close distance to the airports of Hannover and Frankfurt and to the seaports of Hamburg and Bremen/Bremerhaven is a unique location advantage for the international logistics of our customers. With a very close connection to all our EMO Trans teams and network partners around the globe and with a dedicated Route Management system, we could increase transit times for our customers and even cut their shipping costs over the years. Since the material value of our customers is usually very high and the goods are urgently needed very quickly on the most varied of drilling rigs around the world, time and exceptional service are the most important things in this industry.
The connection between Celle and Houston is already historical and since we perform many weekly air and ocean shipments from and to these areas for our customers, the relationship to our office in Houston is outstanding and has become more like a family than just colleagues.
We look forward to more interesting years in which we can offer our exceptional customer service!"
Pictured: the picturesque town of Celle, Germany's "Little Houston."
Uniworld Logistics Provides Farm-to-Fork Supply Chain Solutions EMO Trans' partner in India, Uniworld Logistics, has created a local food supply chain process that is economically viable and business-driven while positively contributing to the environment and community health. Read more about our partner's innovation, even amid the current pandemic.
Generalized System of Preferences (GSP) Set to Expire December 31, 2020
U.S. Customs and Border Protection (CBP) issues guidance for the ACE update for the Generalized System of Preference (GSP) changes which will take effect December 30, 2020. Currently, there is a bill H.R. 8884 that will extend the GSP preferences for six months. Unless action is taken by Congress, GSP is scheduled to expire December 31, 2020. 2021 Customs Broker Triennial Status Report and Fee Submission
NCBFAA ALERT: Customs Business Fairness Act Passes!
Congress passed the Customs Business Fairness Act on December 21 as part of the latest coronavirus relief package that changes the way that U.S. bankruptcy law is applied to customs brokers when importers become insolvent.
Under the current law, a customs broker may be ordered by the bankruptcy trustee to give back money paid to it by the insolvent importer during the past 90 days. It does not matter to the bankruptcy trustee whether that money has already been paid to Customs and Border Protection (CBP) to cover import duties.
For more than 20 years, the NCBFAA has been on the forefront of lobbying to change the status of customs brokers caught up in importer bankruptcies.
The so-called "claw back" is allowed under Section 547 of the Bankruptcy Code, which prohibits preferential payments to any one creditor. By contrast, under the Bankruptcy Code, duty payments to CBP are considered preferential payments because they have a "priority" position in the code.
Under current trade law, there is generally a period of 10 business days between the release of imported merchandise by CBP and payment of estimated duties to the government. Customs brokers pay duties to CBP on behalf of their importer clients through the agency's ACH (automated clearinghouse). It's estimated that customs brokers remit to CBP about $10 billion annually in import duties and other fees.
The NCBFAA specifically proposed a technical amendment to Section 507(d) of the Bankruptcy Code to allow "subrogation" rights for customs brokers who have received money or paid duties to the U.S. government on behalf of a bankrupt importer.
"If a customs broker could be subrogated to the priority rights of CBP, any payments from the importer to CBP via the customs broker during the 90-day period would likewise no longer be subject to a preference payment recovery action," the NCBFAA said.
NCBFAA's longtime Washington lobbyist, Jon Kent, who retired in 2019, sought to amend the Bankruptcy Code in favor of customs brokers for the past 20 years. On several occasions during the early 2000s, the legislation came close to passing, but fell short due to other circumstances.
An attempt to include the bill language in the Customs Business Fairness Act (H.R. 2261) in 2019 failed, despite significant bipartisan support among House lawmakers.
Laurie Arnold of JAS Forwarding in Atlanta, along with Whitmer and Worrall, led the NCBFAA's latest lobbying effort to include the bankruptcy bill in the latest COVID-19 relief legislation which is expected to be signed by President Trump.
"This has been a twenty-plus year battle," said NCBFAA President Jan Fields. "I want to publicly thank Laurie Arnold and Whitmer and Worrall for all of their hard work in 2020."
Here is the summary of the legislation (see Section 10):
The provisions amend various sections of the Bankruptcy Code on a temporary basis to provide additional relief to businesses and individuals directly impacted by COVID-19 pandemic. These provisions also establish procedures to ensure that relief payments and mortgage forbearances granted under the CARES Act and future COVID-19 legislation can be properly implemented under the Bankruptcy Code.
Section 2 amends section 541 of title 11 to ensure that federal coronavirus assistance can be used by the families who need relief rather than creditors. It exempts federal coronavirus relief payments from being treated as property of the estate in bankruptcy proceedings. This amendment sunsets 1 year after enactment.
Section 3 amends section 1328 of title 11 to ensure that families in Chapter 13 bankruptcy cases who have completed all of their plan payments will not be denied a discharge because they have fallen behind on their mortgage payments during this crisis. It makes clear that a debtor will not be denied a Chapter 13 discharge if the debtor misses 3 or fewer mortgage payments. The mortgage payments would continue to be owed to the home mortgage creditor, but the homeowner would not lose the benefits of a bankruptcy discharge for other debts. This amendment sunsets 1 year after enactment.
Section 4 amends section 525 of title 11 to ensure that homeowners in bankruptcy are eligible for mortgage forbearance or other COVID-19 mortgage assistance and ensures that renters are eligible for COVID-19 eviction relief. This amendment sunsets 1 year after enactment.
Section 5 amends sections 501 and 502 of title 11 to set forth a process for creditors to file a proof of claim for the amount lost during forbearance periods granted under the CARES Act, and to impose related requirements for such claims. This amendment sunsets 1 year after enactment.
Section 6 amends section 1329 of title 11 to permit modification of a chapter 13 plan to account for proofs of claim filed pursuant to section 4 above. This amendment sunsets 1 year after enactment. Section 6 also amends section 365(d)(3) of title 11 to allows the bankruptcy court to grant a debtor an additional 60-day delay (120 total) to pay rent if the company has experienced and is continuing to experience a material financial hardship as a result of COVID-19. Any deferred rent arising from the delay would be entitled to an administrative priority claim. This amendment sunsets 2 years after enactment.
Section 7 also amends 365(d)(4) of title 11 to allow a company up to 300 days to determine whether to keep or get rid of certain leases for real property. In this uncertain environment, it is difficult for companies like retailers to determine what their future footprint should be. Allowing companies more time will give them greater visibility into the future will help them make more efficient decisions on their leases. While the businesses are deciding what to do they will still be obligated to continue to pay their rent, absent court order granting relief. Moreover, landlords have the ability to ask the court to allow them to foreclose on the property if they are not receiving adequate protection during this time period. This amendment sunsets 2 years after enactment.
Section 8 amends section 547 of title 11 to protect future payments from being clawed back from landlords and vendors, but only to the extent such payments do not include any fees, penalties, or interest in an amount greater than the amount of fees, penalties, or interest the business would have owed had it not entered into the flexible payment terms. This amendment sunsets 1 year after enactment.
Section 9 amends section 366 of title 11 to prevent the termination of utility services in bankruptcy by ensuring that renters will not be required to furnish a security deposit to maintain utility services during bankruptcy. This amendment sunsets 1 year after enactment.
Section 10 amends section 507 of title 11 to exempt customs brokers who collect and pay duties to Customs and Border Patrol on behalf of importers from the claw back provisions of the bankruptcy code when an importer files bankruptcy. This amendment sunsets 1 year after enactment.
However, the NCBFAA's work to make the amendment to the bankruptcy law permanent continues, since the amendment sunsets one year after enactment.
EMO Trans Inc. – Broker and Consolidator 2020 CTPAT Re-Validation
EMO Trans is happy to announce we have received a successful Re-Validation for the CTPAT supply chain security program based on the NEW and UPDATED 2020 Minimum Security Criteria. To monitor EMO Trans Inc. status, please request monitoring through the CTPAT portal. APHIS Core Message Set Implementation – January 25, 2021
EMO China Describes Current Challenges
Our offices in China have provided the following report on the challenging conditions they’re experiencing during the current peak season. Here’s what you need to know:
China is suffering a huge lack of allocation and shipping containers due to the large imbalance in global trade that has been exacerbated by the COVID-19 pandemic.
China’s growth in exports could remain elevated for another several months, even after Chinese New Year.
Trade growth, a shortage of manpower, and the container shortage has pushed up shipping costs. Compared with July, the shipping cost increase ratio is up 42%. Meanwhile, storage fees, demurrage, advanced fees for pickups, and other extra costs are being incurred during this special period.
In the seafreight market, General Rate Increases on Asia to North America and Asia to Europe rose December 1 and again December 15. As a result of this peak time, the cancellation fee (Space Reservation Fee) was implemented.
With the efficient control of COVID-19 in Shanghai, PVG’s ground operation services are back to normal.
To avoid facing no space allocation or container availability, EMO Trans is suggesting that customers pre-book 21 days ahead and request pickup advanced service. While allocation booking has been cut off until the end of December, EMO China’s teams are doing everything they can to keep customers’ freight moving and meet demands.
Similar challenges are being faced in the airfreight market also with no signs of lessoning over the next few months. Due to the capacity shortage, space from Asia is continues to be extremely tight, particularly on the U.S. and European trade lanes.