Hoisting the sails - PwC

pwc.com 

© 2008 48 PricewaterhouseCoopers. All rights reserved. ‘PricewaterhouseCoopers’ refers to the network of member firms of PricewaterhouseCoopers International Limited, PricewaterhouseCoopers 

each of which is a 

separate and independent legal entity.

Transportation & Logistics 

Hoisting the 

sails* 

Global Shipping & Ports 

Capability Statement 

*connectedthinking

2 PricewaterhouseCoopers

Introduction 

The Transportation & Logistics industry forms the back bone of global supply 

chains. The shipping industry plays a dominant role as 90% of world trade 

is seaborne. Without shipping the import and export of goods on the scale 

necessary for the modern world would not be possible. There are around 50,000 

merchant ships trading internationally, transporting every kind of cargo. The world 

fleet is registered in over 150 nations, and manned by over a million seafarers of 

virtually every nationality. 

Ships are technically sophisticated, high value assets (larger high-tech vessels 

can cost over USD 150 million to build), and the operation of merchant ships 

generates an estimated annual income of over USD 380 billion in freight rates, 

representing about 5% of the total global economy. 

PricewaterhouseCoopers’ (PwC) Shipping & Ports practice has grown in step with 

the industry, supporting our clients through industry restructurings, regulatory 

transformations, technological advances and changes in financial reporting and 

corporate governance requirements. Our experience and network of dedicated 

shipping industry practitioners positions PwC to provide clients with quality audit 

and professional services uniquely tailored to large, global shipping and ports 

organisations. We have developed our Shipping and Ports expertise through 

working with the leading shipping and port companies in the world. We have 

a long-standing and proven track record in auditing and consulting within the 

contexts of international shipping, ports, logistics and supply chain management. 

PwC’s service offerings are staffed with highly qualified, experienced individuals 

and leaders in our profession. We provide services for deep sea, short sea and 

inland shipping companies, port authorities and terminal operators in the areas: 

audit and assurance, business advisory and global tax. 

Our investment in the shipping and ports industry provides you with professionals 

who understand the nuances of your industry and bring a continually fresh 

perspective to your organisation. PwC’s response to your challlenges! 

Klaus-Dieter Ruske Michel Adriaansens 

Global Transportation & Global Shipping & Ports Leader 

Logistics Industry Leader 

Hoisting the sails 

3


Contents 

Our response to your challenges: 

1. Accounting, Reporting & Governance – Keeping your log book 6 

2. Asset management & Restructuring – 

Capitalising on your opportunities 10 

3. Fraud – Protect your shipment 14 

4. Customs – Sailing safely through rough waters 18 

5. Mergers & Acquisitions – Navigating deals 22 

6. International Tax Strategy – Choosing a profitable course 26 

7. Performance Improvement – Gateway to profit 32 

8. Integrated IT Systems – Automating the bridge 36 

9. Creating a sustainable business – 

Our responsibility to the maritime future 40 

Our position – piloting the fleet in the Shipping & Ports industry 44 

What differentiates us 46 

About PwC 47 

We are where you are 48 


5

1 Accounting, 

Reporting 

& Governance 

‘Keeping your 

log book’ 


Accounting principles and Shipping and Ports 

Companies in the Shipping and Ports industry compete in 

a global environment, and may need to adhere to several 

different generally accepted accounting practices (GAAP) 

in their different areas of operation. Treatment of issues 

specific to the Shipping and Ports industry, such as the use 

of a component approach to ships (e.g. engines/ hauls) and 

terminals, calculating the residual value of ships, the use of 

special purpose entities for ships, and dry-dock accounting, 

may vary. Other important areas where discrepancies 

can occur include government grants, lease contracts, on 

or off balance sheet financing arrangements, provisions 

for scheduled maintenance, and derivatives revenue 

recognition. We have specialists for different GAAPs 

available, all with deep knowledge in the Shipping & Ports 

industry. As the market leader in the Shipping & Ports sector 

and large-scale GAAP conversions, we are committed to 

helping companies like yours maximise the benefits of a 

certain GAAP and improve the quality of your GAAP reports. 


1 Accounting, Reporting & Governance 

Based on our experience with numerous IFRS transitions 

and audits under IFRS, we have prepared “Full Steam 

Ahead with IFRS”, a report that addresses the major 

challenges faced by shipping companies that are applying 

International Financial Reporting Standards (IFRS). In this 

publication we highlight the key technical and business 

issues that Shipping and Port companies should address to 

get maximum benefit from implementing IFRS. 

High quality corporate reporting is too important to be 

determined solely by the shape of externally-imposed 

regulation. To stake their own claim to reporting excellence 

and public trust, Shipping and Ports companies must 

foster a culture that views reporting transparency as a 

worthy end in itself, independent of rules and regulations. 

At PricewaterhouseCoopers, we know what it takes to meet 

both the high standards of today’s regulatory reporting 

requirements and the even higher expectations of your 

stakeholder community. Wherever your company does 

business, we offer a wide spectrum of services to ensure 

your corporate reporting is clear, complete, and relevant. 

Reporting corporate performance in Shipping and Ports 

Understanding the GAAPs of each country in which you operate is no longer sufficient to ensure 

adequate reporting. Complex regulations such as Sarbanes-Oxley as well as the continuing proliferation 

of guidance and regulations relating to ‘narrative’ reporting accompanying financial statements, have 

made the task even more challenging for Shipping and Ports companies. 

Investors today are on guard against reporting that meets regulatory requirements, but fails to provide a 

fully transparent view of a company’s health and prospects. Increasingly, investors also want companies 

to report on a broad set of non-financial measures, which, combined with financial reporting, might 

provide a better basis for judging corporate performance. 

7

PricewaterhouseCoopers Accounting & Reporting 

services and solutions include: 

• Audit of financial reports 

• IPO advice and assistance 

• Compliance with regulations and laws 

• Dealing with regulators 

• IFRS requirements 

• Non-financial and sustainability reporting 

(environmental, safety and social 

responsibility issues) 

• Sarbanes-Oxley Act 

• Transparency and increased disclosure 

• Transaction accounting and reporting 

• Understanding trends in corporate reporting 

• XBRL 

Hedging fuel price risk 

Shipping companies are structurally exposed to fuel price 

risks. Increasing fuel prices may impair the profitability 

going forward. When your functional currency or costs/ 

revenues are other than USD you, as a shipping company, 

are also substantially exposed to USD risk on purchases 

of fuel since fuel is quoted in USD internationally. Shipping 

companies may also be exposed to foreign currency 

risks on the revenue side. Given high fuel prices, shipping 

companies are looking to increase their protection through 

the use of financial derivatives, either locking-in future 

purchase prices on forecasted purchases of fuel with 

forward or swap contracts, or by entering into options to 

cap the forecasted purchase prices at maximum level, or 

within a range with a collar. 

PricewaterhouseCoopers risk services and 

solutions include: 

• Advise on and review risk management policies 

• Advise on and review processes, automation 

and internal controls 

• IAS 39/FAS 33, e.g. implementation of 

hedge accounting 



2 De bouwstenen van het toezicht 

9

2 Asset 

Management 

& Restructuring 

‘Capitalising on 

your opportunities’ 


Manage your shipping and ports assets smart 

The Shipping and Ports industry is extremely capital 

intensive, so well thought-out capital allocation decisions 

are essential to maintaining competitiveness. 

Investments in ships, infrastructure, ports, warehouses 

and terminals deal with a lot of money. Huge budgets are 

spent on new assets, replacements and maintenance. 

Developments in the environment make asset management 

more and more complex. Management must cope with 

huge challenges such as achieving higher asset utilisation, 

decreasing capital and operational expenditures, 

managing risks efficiently and weighing the options 

for all stakeholders. 

Asset (lifecycle) management is the process of establishing 

an operating environment under which capital returns are 

improved through effective management of risks inherent 

in owning, managing and operating a large asset base. 

Companies may be an asset owner, asset manager, service 

provider, or some combination of these roles. 

Companies need to take care to assess the expected 

benefits of spending (e.g. improvement of financial 

performance, availability, improvement of environmental 

performance of health and safety issues) to ensure that the 

right investments are made. They also need to be prepared 

to document to stakeholders how these investments create 

and increase value. 

Increasing transparency, decreasing cost, improving 

reliability and availability of assets and improving on 

performance in health, safety and environment are key 

goals of a considered approach to asset management. 


2 Asset Management & Restructuring 

PricewaterhouseCoopers asset management services 

and solutions include: 

• Benchmarking of Asset, Maintenance and Service 

Management practices 

• Visioning overall Asset, Maintenance and Service 

Management function including organisation, 

processes, people and technology 

• Designing and implementing Asset, Maintenance 

and Service Management organisations, including 

roles and responsibilities 

• Analysis of and independent insight into the value 

drivers of the asset intensive business and the 

underlying performance model 

• Identification of specific restructuring and 

privatisation projects 

• Support communication and change management 

work streams 

• Select Enterprise Asset Management systems and 

simulation (risk analysis) tools 

Restructuring & privatisation opportunities 

Ports are valuable assets for the national economy and 

hence, any changes in ownership need to be considered 

carefully and cautiously. 

There are many views on how port assets can be 

structured. Financial and legal restructuring of a port is 

a complex procedure with many decisions to be taken. 

PricewaterhouseCoopers has a unique ability to offer the 

required blend of specific skills to structure and transfer 

ownership of the port assets. 

Our industry specialists have a profound knowledge of 

the various concepts of privatisation, corporatisation, 

commercialisation, and deregulation. These concepts rely 

on instruments such as licenses and concessions, leasehold 

11

contracts, Build-Operate-Transfer, Build-Operate-Finance- 

Transfer, Build-Operate-Own, and other arrangements. 

Our approach for the restructuring of the port is a process 

which aims to maximise the important advantages for the 

different stakeholders including: the port authority, the 

terminal operators, the port customers, and the national 

government and economy. 

More and more, port authorities are set up as separate 

companies, operating more independently from 

government authorities. This development may ultimately 

involve privatisation. 

PricewaterhouseCoopers restructuring services 


• Assessing the strategic tasks to be performed by 

port authorities 

• Designing the operational structure for new entities 

• Assisting in defining the elements to be handed 

over to the private sector and the responsibilities 

and assets to be kept in hand of public authorities 

• Valuation of companies to be privatised 

• Evaluating feasibility of restructuring and 

privatisation projects 

• Evaluating expected returns on investment 

Public Private Partnerships (PPP) 

The ‘infrastructure gap’ and its negative impact on 

economic growth, job creation and social cohesion globally 

have been recognised for many years. The need to improve 

and expand infrastructure and suprastructure in ports 

(like cranes, quays and railways) is seen as a necessary 

condition to successful economic growth. However, 

governments have limited financial resources to devote to 

increased capital expenditure for improving and expanding 

infrastructure and suprastructure and face restrictions on 

their ability to raise debt. 

In order to bridge the growing gap between the cost of 

these projects needed and the resources available, and 

to ensure that the infrastructure is delivered as efficiently 

and cost-effectively as possible, the key question is how 

to deliver cost-efficient investment. In this context, Public 

Private Partnerships (“PPPs”) are a growing element of 

public sector procurement across the globe. 

We believe that Public Private Partnerships offer a viable 

alternative to traditional procurement methods and we 

would like to see the public and private sectors doing 

more business together. PwC has substantial experience 

in advising both the public sector and private companies 

in structuring, financing and managing huge infrastructure 

projects. 

PricewaterhouseCoopers PPP services 


• PricewaterhouseCoopers has extensive experience 

of working with both governments and private 

sector bidders. 

• We help the public sector develop the right 

approach to procurement. 

• We help private sector partners to get the best 

out of the process. 

• As an independent adviser, we have advised on 

more PPPs than any other professional services 

organisation and have specialist knowledge of 

deals in all sectors including transport, housing, 

education, health, defence, water and waste. 


Tailored Industry Publications 


Maximising Opportunites at your port of call 

We understand our clients operate in a global business 

environment and are confronted with many new 

opportunities. They are challenged to define the according 

strategic responses to turn their overall strategic vision into 

reality. In our paper ‘Maximizing Opportunities at your port 

of call’ we provide you an extensive overview of our 

services and experiences in advising ports on how to 

maximise opportuntities. 

Delivering the PPP Promise 

PricewaterhouseCoopers’ white paper, Delivering the 

PPP promise, identifies some of the key issues raised 

by PPP projects and suggests appropriate solutions. 

Essentially, delivering the PPP promise, delivering solutions 

that fund new roads, improve rail services and expand and 

improve ports more quickly and efficiently. 

Trans-European Transport Network 

Our paper on the Trans-European Transport Network 

deals with the key challenges that EU countries are 

facing in realising necessary investments, co-ordinating 

investment among member states, and financing the 

construction and operations of the infrastructure. 

2 Asset Management & Restructuring 

13

3 Fraud 

‘Protecting your 

shipment’ 


Managing fraud risks 

in the Shipping & Ports industry 

Fraud has continued making headlines into the 21st century, 

yet many executives still believe that “fraud can’t happen in 

my company”. But fraud does happen, and often – nearly 

half (45%) of organisations in the Transportation & Logistics 

industry report having experienced fraud over the past two 

years, and the actual incidence of fraud may be even higher, 

as detection can be difficult. 

Fraud schemes in Shipping & Ports are manifold. 

Straightforward examples such as manipulation of financial 

statements, commercial bribery and cash skimming may 

occur as in any other industry sector and need to be 

addressed at the top management level. More specifically, 

the shipping and ports industry is susceptible to: 

• Cargo theft and other types of misappropriation of 

assets – the most prevalent type of fraud in this industry 

• Revenue leakage – likely to happen if shipping, billing 

and revenue recognition functions are not linked for 

all operations 

• Unsupported payments – as shipping companies 

operate in a large number of countries with various 

business cultures, there is an inherent risk of these kinds 

of payments, which may be in contradiction to laws and 

regulations 

• Falsification of shipping and customs papers – leading 

to shipping companies finding themselves liable for VAT, 

import duties, excise and even penalties on shipment 

• Carousel fraud, also referred to as the “VAT merrygo-round” 

– taking advantage of the opportunities for 

falsification which arises when goods are shipped 

across borders 


Managing the threat – 

how to take action against fraud 

3 Fraud 

Executives can reduce the risk of serious fraud by fostering 

a culture of honesty and high ethics, implementing a 

code of conduct supported by a whistle blowing system, 

evaluating and improving anti-fraud processes and 

control activities – as diverse as approvals, authorisations, 

verifications, reconciliations, segregation of duties, 

reviews of operating performance and security of assets 

– and developing an appropriate oversight process. 

Management should evaluate whether appropriate internal 

controls have been implemented in any area identified as 

posing higher risk, as well as controls over the financial 

reporting process. Controls is the core competence of 

PricewaterhouseCoopers. Combined with our profound 

understanding of the industry, we can support Boards of 

Directors and management in designing and implementing 

appropriate risk management and control systems. 

In addition, our risk management and forensic experts 

can help you minimise the risk of fraud and deal with it 

effectively once a case of misconduct is presumed or 

has occurred. 

15

PricewaterhouseCoopers antifraud services 


• Identification and assessment of fraud risk using a 

specially developed analytical tool, Fraud Scan ® 

• Expert investigation where fraudulent (suspicious/ 

criminal) actions are suspected 

• Forensic acquisition and analysis of electronic 

evidence and document management 

• Quantifying losses 

• Analysis of the company’s individual risk structure 

• Restructuring of business processes for 

crime prevention 

• Design and improvement of internal 

control mechanisms 

• Optimisation of sensitive IT systems 

• Introduction of communication and 

prevention strategies 

• Internal staff training on actions to take when fraud 

is suspected 

• Advice and assistance on securing and 

recovering assets 

• Analysis of cash and payment flows 

• Preparation of factual statements that are 

admissible to court 

• Investigation into potential breaches of the laws 

against money-laundering 

• Presentation of independent expert evidence 

• Support in drafting company specific codes 

of ethics 




Protect your shipment 

Supporting Transportation & Logistics companies in managing fraud risks 

Fraud has continued making headlines into the 21st century, yet many executives still believe that 

“fraud can’t happen in my company”. But fraud does happen, and often – nearly half (45%) of 

organisations in the Transportation & Logistics industry report having experienced fraud over the 

past two years, and the actual incidence of fraud may be even higher, as detection can be difficult. 

This report will outline some of the most common fraud schemes in the Transportation & Logistics 

industry and provide suggestions on combating fraud. Where relevant we have also incorporated 

industry-specific insights from the results of our Global Economic Crime Survey 2005. 

Predicting the unpredictable 

Protecting Transportation & Logistics companies against fraud, reputation and misconduct risk 

The potential for corporate fraud and misconduct to easily spread from a small brush fire into a 

full-blown firestorm has garnered the attention of regulators, with the Unites States SEC, the Public 

Company Accounting Oversight Board and the Federal Sentencing Commission all having recently 

addressed this topic. While it may not be possible to eliminate the risk of fraud altogether, a company 

can at least identify it early and minimize its damage with proper planning, policies and procedures. 

This report provides step-by-step guidance on how to develop an effective antifraud program that 

addresses not only financial statement risk, but equally important reputation, operational, legal 

and strategic risks. In addition, it provides a summary of fraud schemes that are common to the 

Transportation & Logistics industry. 

3 Fraud 

Global Economic Crime Survey 

PricewaterhouseCoopers regularly surveys companies’ experiences with economic crime. The biennial 

Global Economic Crime Survey is the most comprehensive investigation of this kind. With over eight 

years of data on trends, perceptions and incidents of fraud, PricewaterhouseCoopers’ Global Economic 

Crime Survey 2007 points to the continued evidence of the intractability of fraud. Entitled Economic 

crime: People, culture and controls the report reveals that internal controls alone are not enough to fight 

it. Instead, controls must be backed by a strong ethical company culture, a broad risk management 

programme, and “zero tolerance” of executives or other employees who commit economic crimes. 

This year’s survey is based on months of interviews of over 5,400 companies located in 40 countries. 

It is the largest, most comprehensive international survey of economic crime. 

17

4 Customs 

‘Sailing safely 

through rough waters’ 


Customs compliance 

For shipping companies involved in international trade, 

proper management of customs compliance is critical to a 

successful operation. Accordingly, companies must develop 

comprehensive guidelines for compliance with import and 

export requirements, while employing strategies to reduce 

the costs of compliance on a worldwide basis. 

One of the common challenges facing shipping and ports 

companies is the inability to determine a complete and 

current “footprint” of their import and export compliance. 

This is, in part, due to the decentralisation of customs 

compliance within most companies and the use of 

independent customs brokers, which results in the inability 

of implementing uniform control procedures. If a company 

does not have a comprehensive understanding of its 

customs function, it may experience many customs claims, 

more supply chain interruption, and increased overall 

costs and an inability to systematically identify cost saving 

opportunities and potential areas of risk. 

PricewaterhouseCoopers customs compliance 


• Assisting companies with the development and 

implementation of a global customs compliance 

management strategy. 

• Helping companies to develop insightful import 

and export strategies which may reduce customs 

liabilities, while integrating the compliance process 

into overall business operations. 

Authorised Economic Operator (AEO) 

AEO is an European Commission (EC) initiative that requires 

companies to maintain high levels of security throughout 

their supply chain in order to gain recognition from customs 

that they are a secure trader and obtain the associated 


4 Customs 

privileges. The EC has issued guidelines that allow shipping 

companies to carry out detailed self-audits to demonstrate 

that they comply with the requirements before submitting 

a formal application. This will often be followed by a 

detailed audit from the corresponding customs authorities. 

Companies are also likely to be asked to demonstrate that 

there are adequate controls and processes in place to 

manage declarations of valuation, origin and classification. 

AEO is of major interest to shipping companies importing or 

exporting goods into and out of the EU. A company must be 

established in the EU and have a good compliance review 

record to qualify. Companies must consider whether AEO is 

appropriate to their model and where it is, should consider 

when they want to be authorised. 

Benefits will be provided to those operators who comply 

with the security and safety requirements contained in the 

AEO legislation. Benefits include customs simplification 

and security facilitation. An Authorized Economic Operator 

must comply with financial and customs reliability in order 

to benefit from customs simplification. Compliance with 

the customs simplification in addition to specific security 

standards and requirements is necessary to benefit from 

security facilitation. 

PricewaterhouseCoopers AEO services and 


An initial review to identify a company’s eligibility 

and the benefits and obstacles faced in obtaining 

certification, including: 

• High level customs profile and supply chain 

review to identify any gaps between legislative 

requirements, EU guideline requirements and a 

company’s procedures. 

• Assistance in implementing the processes required 

for AEO certification as well as providing specific 

tax and legal advice on complex issues. 

19

Customs-Trade Partnership Against Terrorism 

In response to the increased focus on security in the United 

States, the US Bureau of Customs and Border Protection 

(Customs), is operating with a new emphasis on security. 

Accordingly, Customs has initiated the Customs-Trade 

Partnership Against Terrorism (C-TPAT) program. The focus 

of C-TPAT is on importing companies’ supply chains, and 

the security measures put in place to prevent terrorist 

penetration. Customs is strongly encouraging all importers 

to join C-TPAT and has announced benefits for those 

shipping companies that volunteer to comply. 

PricewaterhouseCoopers C-TPAT services and 


• Assisting companies with admittance and 

compliance to C-TPAT. In order to be admitted 

to C-TPAT, companies must engage in 

self-assessments, security reviews, and 

program development. 

• Helping shipping companies compile the required 

data and complete the application and agreements 

that are a pre-requisite to signing up for the 

C-TPAT program. 

By using our developed approach to C-TPAT, your company 

may more quickly experience C-TPAT benefits, which 

include a reduced number of cargo inspections, expedited 

inspections, and increased supply chain efficiency. 




Customs Bulletin 

PricewaterhouseCoopers regulary distributes a Custom Bulletin on a monthly basis. Authorised 

Economic Operator including all legislative updates are hosted in these publications. 

4 Customs 

Independent Verification of C-TPAT Cargo Security Controls 

A private sector, third party verification process has been successful in several government policy 

initiatives. This white paper proposes a similar solution to reduce the risk that terrorists will exploit 

legitimate trade and the intermodal container to attack the United States using a weapon of mass 

destruction. By embedding a private sector, third-party verification process in the Custom-Trade 

Partnership Against Terrorism (C-TPAT) program, the United States can be better protect and expedite 

the transport of cargo through its ports. 

21

5 Mergers 

& Acquisitions 

‘Navigating Deals’ 


Increased acquisition activities within the 

Shipping and Ports industry 

Consolidation and a push towards vertical integration are 

driving increased acquisition activities in both the Shipping 

and Ports sectors. Shipping companies are investing heavily 

in port terminals, while ports are investing in hinterland 

connections like train companies and inland ports. 

How do you make a smart deal in the Shipping and Ports 

industry? First, start with your deal strategy – it has to be 

flexible enough to adjust for the unexpected, aggressive 

enough to win highly competitive business terms, and broad 

enough to envision the challenges that will confront you 

from the moment the contract is signed. As you move down 

the path toward reaching agreement on your deal, you will 

also need access to the right information at the right time. 

Tax issues, legal risks, conflicts of interest, fluctuations in 

the shipping and ports markets – all need to be taken into 

account with each decision you make. 

However, in a business environment where information can 

easily overwhelm and confuse – which advisor can help you 

fashion a deal that works? To start, look for someone with 

sufficient experience and judgment in M&A in the Shipping 

and Ports industry. Plenty of patience and stamina is also 

recommended, as is the capability to add value across 

the entire deal-making continuum, from strategy through 

post-deal integration. 

At PricewaterhouseCoopers, we fulfill that description. 

We offer a full range of tax, financial, business assurance, 

and advisory capabilities covering acquisitions, disposals, 

private equity, strategic M&A advice, advice on listed 

company transactions, financing, and public/private 

partnerships. We’re also able to deploy experienced deal 

teams – combining Shipping and Ports industry knowledge 

with local market expertise – anywhere and everywhere your 

company operates. And while every deal is unique in detail, 

most will benefit from the broad experience we bring in 


5 Mergers & Acquisitions 

the areas of due diligence, tax, and, where permitted, legal 

advice. In short, we offer integrated solutions with deep 

Shipping and Ports experience precisely matched to your 

particular deal situation. 

PricewaterhouseCoopers M&A services 


• Accessing the capital markets and IPOs 

• Acquisitions, joint ventures, and alliances 

• Downsizing and carve outs 

• Transaction risks 

• Deal execution 

• Deal origination 

• Valuation of assets 

• Preparing of business plans and financial 

modeling of projections 

• Capital raising, debt raising and private 

equity financing 

• Project managing other advisers (e.g., lawyers, 

due diligence providers, etc.) 

• Exit strategy reviews 

• 

Due Diligence 

23



Transportation and Logistics 

Intersections* 

Global Transportation and Logistics Transactions Analysis 

Third quarter 2007 

*connectedthinking 

Global Sourcing 

PwC services alongside the “deal continuum” 

Grouping expertise together for one integrated service through the deal 

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Deal flow 

Bid support 

Investment banking 

advice 

Strategy evaluation 

Collaborate and Innovate: 

a new world of sourcing* 

Identifying 

deals 

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Evaluating 

deals 

No-access due 

diligence 

Deal strategy validation 

Value driver 

identification 

Target evaluation 

(indicative) 

Synergy assessment 

Pre-deal purchase price 

allocation 

How to succeed in outsourcing 

Intersections 

through strengthened governance* 

This is a global report on the analysis of global Although transportation the number of companies and logistics transactions. The report 

pursuing strategic outsourcing 

is published on a quarterly basis, examining some of the global trends in the industry and provides 

initiatives continues to rise, 

charts and commentary that support our point of view on these trends. 

Intersections* 

This is a global report on the 

analysis of global transportation 

and logistics transactions. The 

report will be published on a 

quarterly basis, examining some of 

the global trends in the industry and 

provides charts and commentary 

that support our point of view on 

these trends. 

Pre Deal First 100 days Transformation 

Collaborate & Innovate: 

a new world of sourcing* 

Outsourcing is growing fast and 

delivering results. It is covering 

more parts of the business 

landscape, and gaining in 

complexity. Many challenges 

remain. Today’s market leaders 

are embracing collaboration and 

transparency to achieve the promise 

of productivity and performance in 

the outsourcing enterprise. In the 

spirit of collaboration, we invite you 

to share your experiences. 

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Executing 

deals 

Financial DD 

Commercial DD 

Operational DD 

Deal structuring 

Negotiation support 

Financing advice 

Legal services 

Tax and human 

resources issues 

Completion accounts 

SPA support 

studies reveal that as many as 

half of these investments fail to 

return the benefits executives 

expect. Even a quick glance at the 

portfolio of risks that can derail 

an outsourcing initiative begins to 

provoke questions about how to 

manage outsourcing uncertainty 

– across political and country risk, 

contractual risk, operational risk, and cultural risk. Common 

reasons for outsourcing failures vary widely, but each can be 

traced back to a fundamental lapse in managerial oversight and 

control – in effect, to a failure in governance. 

In this Whitepaper, we examine the most effective way to 

manage outsourcing risk. This White paper outlines the steps for 

establishing these centers of excellence and how to improve the 

overall value of outsourcing initiatives. 

24 PricewaterhouseCoopers 

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Making deals 

successful 

Post merger integration 

Synergy review 

Operational improvements 

Purchase price allocation 

(IFRS / US GAAP) 

Accounting 

Integration support 

Finance Function 

Effectiveness 

Governance, Risk & 

Compliance 

Restructuring, 

reorganisation 

Structuring employee 

benefits schemes 

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Consider Channel 1 independence restrictions! 

Harvesting 

deals 

Portfolio review 

Vendor assistance 

Sell-side DDCarve-outs 

Capital markets 

IPO advice 

Buyer identification 

Investment banking advice


1 Titel 

25

6 International 

Tax Strategy 

‘Choosing 

a profitable course’ 


Managing tax risks and facing the challenges 

Emerging governance and ethical standards require 

shipping companies to put more emphasis on managing 

risk. At the same time, regulatory pressures related to 

accounting and reporting transparency have made timely 

disclosure of liabilities, contingencies and internal control 

processes an issue of the highest importance. Surprisingly 

though, tax all too often remains a ‘black box’ – impervious 

to close scrutiny by investors and analysts. Nevertheless, a 

company’s approach to tax strategy and risk management 

has an important impact on its perceived value and should 

be a key area of focus for any company concerned about 

maintaining its reputation. 

Unfortunately, for a variety of reasons, tax matters are often 

not dealt with in a systematic way. There may be no clear 

tax strategy in place; any tax objectives or related policies or 

manuals; or the tax function itself may be poorly organised. 

As a consequence, tax opportunities are lost and risks are 

identified too late. This is a particular danger in the Shipping 

industry, where exposure to corporate tax claims is often 

high and non-compliance with transaction taxes such as 

VAT and customs rules can effectively put a company out 

of business. 

Through our shipping industry experience and 

expertise we can help you realise the best services 

and solutions to some of the key tax challenges: 

• Optimise your worldwide tax position by taking 

a global view of your business 

• Manage the many company and employee 

taxation risks associated with cross-border 

operations and employment 

• Develop a company’s global tax strategy and 

design a tax risk management model 

• Assess tax risks in M&A situations 

• Enhance control of your compliance globally 

• Lowering the cost of capital 


VAT and other indirect taxes 

Value Added Tax (VAT) is a broadly-based transaction 

tax on goods and services, and all European Union (EU) 

countries are required to operate a VAT system as part of 

their membership obligations. Many non-EU countries also 

operate a VAT system. The VAT issue can be extremely 

complex, widely due to constant changes in legislation 

leading to unforeseen liabilities. Moreover, shipping 

companies are potentially subject to a number of other 

indirect taxes such as freight taxes. Unless shipping 

companies manage their VAT and other indirect taxes, 

their profitability will decrease whilst working capital 

requirements (cash flow) and risks increase. 

Managing tonnage tax 

6 International Tax Strategy 

PricewaterhouseCoopers VAT/indirect taxes services 


• Review of the compliance of your import/ export 

flows with the VAT obligations and the existence of 

planning opportunities 

• Assistance in the application/implementation of 

VAT procedures and processes 

The shipping industry and its related activities are generally 

in good shape worldwide. A high demand for cargo space 

and strong international investment in new vessels led to an 

above average growth over the last few years. 

Particularly in Asia the shipping industry has developed a 

strong base, while Europe is trying to maintain its position. 

In this respect favourable tax and other incentives play 

an important role. One of the most important incentives 

has been the introduction of the favourable tonnage tax 

principle. Most European countries implemented a tonnage 

tax regime or other favourable tax regimes. 

27

The main advantage of the tonnage tax regimes is the 

very low effective tax rate of sometimes less than 1%, 

when the shipping business is doing well. Tax payable is 

based on the registered tonnage of a vessel, multiplied 

by a fixed amount of deemed profit per ton, instead of the 

actual accounting profits from the exploitation of a vessel. 

Nevertheless, the regimes differ in detail in calculation 

methods and concerning qualifying activities, ownership, 

lock up period, capital gains, flag requirement and 

management requirements. In the European Union, tonnage 

tax regimes are implemented in Belgium, Cyprus, Denmark, 

Finland, France, Germany, Greece, Ireland, Italy, Malta, the 

Netherlands, Norway, Poland, Spain, Sweden (presumably 

sometime in 2008) and the UK. 

Only certain shipping activities qualify for a tonnage 

tax regime. Most tonnage tax regimes are applicable to 

‘maritime transport’: the transport of goods and persons by 

sea in international traffic. Under some tonnage tax regimes 

towage, dredging and/or ship management activities 

may also qualify. To qualify for a tonnage tax regime a 

shipping company must have a certain degree of ownership 

regarding the vessel. The required degree of ownership 

differs between the different tonnage tax regimes. 

PricewaterhouseCoopers tonnage tax services 


• Helping companies decide how to structure 

their shipping and other business 

• Advise companies with the selection of the most 

appropriate tonnage tax and other favourable tax regime 

International mobility and 

cross-border employment 

Enterprises active in the Shipping & Ports industry sector 

are typically faced with cross-border employment as a 

consequence of the multinational nature of their activities. 

An increasingly mobile workforce can create tax residence 

or permanent establishment problems. Every cross-border 

worker should be evaluated for immigration compliance 

to ensure the business is not inadvertently allowing staff 

to work abroad illegally. What’s more, cross-border 

employment involves a real risk of creating a permanent 

establishment, triggering severe tax reporting and financial 

repercussions. Specific local shipping wage tax and HR 

legislation might also result in large opportunities for 

shipping companies to benefit from. 

PricewaterhouseCoopers international mobility 


• PricewaterhouseCoopers can advise on the most 

tax efficient HR solutions and help manage and 

control the various and numerous risks costefficiently, 

using in-house developed, highly 

sophisticated and automated tools. 

• The administrative burden will be taken away from 

the HR manager. You can entrust us with handling 

the whole international employment process – 

from work permit tracking over immigration case 

management to tax return preparation. 

Transfer pricing (TP) 

Inter-company transactions across borders are growing 

rapidly and are becoming much more complex. Transfer 

pricing is an important issue for the shipping industry. 

When ships cross international boundaries, compliance 

with the differing requirements of multiple overlapping tax 

jurisdictions is a complicated and time-consuming task. 

Tax authorities from each country are imposing stricter 

penalties, new documentation requirements, increased 

information exchange and increased audit/inspection 

activity, so accurate compliance is critical. At PwC, we 

have a strong international network of dedicated transfer 

pricing specialists with advanced training in economics, 


accounting, law and project management and highly 

experienced in the Shipping and Ports industry ready to 

work with you. 

PricewaterhouseCoopers TP services and 


• Documentation and planning 

• Dispute resolution 

• 

Advance pricing agreements (APAs) 


6 International Tax Strategy 

29


Choosing a profitable course – European tonnage tax regimes for the shipping industry 

All tonnage tax regimes in Europe are based on the same principle – tax payable is based on the 

registered tonnage of vessels, multiplied by a fixed amount of deemed profit per ton, instead of the 

actual accounting profits. To facilitate shipping companies in making their choice for the optimal regime, 

PricewaterhouseCoopers compared the European tonnage tax systems for the shipping industry. 

This report gives you a detailed description of the differences between them and calculation examples, 

as well as an outline of the background of the tonnage tax regimes. 

Tax Risk Management Guide 

This guide outlines firstly the issues that need to be discussed when a company is deciding on its policy 

and addressing its approach to tax risk management, secondly a framework for managing the risks and 

finally some specific tools and techniques that can be used in doing so. The guide addresses the need 

for key stakeholders to be comfortable that there is a tax risk management policy in their organisation, 

that tax, as one of the key costs in the business is being properly managed and that the inherent risks in 

the tax position of the organisation are being both understood and properly controlled. 

Opportunities & Challenges in the Shipping Industry 

The PricewaterhouseCoopers tax shipping network is finalising the next version of its leaflet 

‘Opportunities and challenges for the shipping network’. The leaflet includes an overview of tonnage tax 

regimes and other tax systems applicable to shipping companies in 19 countries. The summary covers 

all key shipping nations in Europe as well as some of the key shipping countries outside Europe such as 

mainland China, Hong Kong and Singapore. Cyprus and Malta were added in the version published in 

November 2007. 



1 Titel 

31

7 Performance 

Improvement 

‘Gateway to profit’ 


Improving your performance 

We help the world’s most progressive Transportation 

and Logistics organisations, of all shapes and sizes, to 

continuously evolve and adapt in the face of a constantly 

changing and increasingly complex environment. We help 

our clients react with agility to opportunities and threats 

by delivering ongoing performance improvements to allow 

them to gain and protect competitive advantage. 

Our performance improvement consultants offer 

services in the following areas: 

• Finance 

• Operations 

• People 

• Strategy 

• 

Technology 

Financial effectiveness 

Shipping and Port companies should be looking at building 

the processes, controls (yield-management) systems 

and staff capabilities that ultimately help to manage the 

business better, both now and for the future. Management 

will raise questions like: How can we get more value from 

our company’s finance function? Does our finance function 

support our company’s business operations? What are the 

key risks faced by our company – and are we effectively 

managing those risks? How do we spend less time retrieving 

and reporting information? Does our company have the 

appropriate organisation in place to address compliance 

requirements? Have we got the right person in the right 

finance role? 

We work closely with clients to improve the effectiveness 

and efficiency of their companies’ finance operations. Our 

accounting, organisational and technology skills can help 


enhance the core transaction processing and reporting 

competencies of the finance function, while strengthening 

its ability to support management decision-making and 

corporate strategy. 

Maximising your revenues 

7 Performance Improvement 

PricewaterhouseCoopers financial effectiveness 


• Finance reviews 

• Performance management 

• Consolidation and reporting 

• Treasury and working capital 

• Back office operations 

• People 

• Systems and tools 

• Risks and controls 

Shipping and Ports companies face significant challenges in 

recording and collecting all of the revenue to which they are 

entitled. This is especially true because of the high volume 

of transactions and several locations of service delivery. 

Revenue leakage can occur in the following situations: 

• Billing and shipping terms are commonly tailored to fit 

customer needs. However, tiered pricing, incentives 

and discounts are not always communicated accurately 

between sales, operations and finance, resulting in 

errors and customer disputes. 

• Complex billing and shipping terms may not be 

accepted by downstream systems. Errors related to 

work-arounds or manual adjustments result in lost 

revenue or additional costs. 

• Failure to reconcile order-specific quantities, size and 

weight with actual picked-up or delivered items results 

in unbilled revenue or costly loss-related claims. 

• Incomplete or inaccurate shipping information often 

33

• 

• 

result in items not progressing to the next stage of 

delivery. Unresolved errors or omissions result in billing 

or collection difficulties. 

Incomplete or inaccurate manifests result in delayrelated 

costs. 

Unclear or inaccurate terms result in disputes between 

parties; third-party carriers often have no incentive to 

work with originating shippers to clear disputes over 

volume discounts and surcharges. 

PricewaterhouseCoopers works with shipping companies 

to address these challenges, helping clients implement new 

sales management processes that eliminate service delivery 

at below-margin price points and metrics that prevent sales 

teams from receiving commissions for unprofitable sales. 

Identify Quantify Capture 

Identifies where you 

are leaking revenue 

and diagnoses 

critical problems. 

Quantifies how 

much you can 

capture and 

evaluates the 

ROI of recovering 

the revenue. 

Maximizer Solutions 

Shared service centres, outsourcing and 

off-shoring 

Captures the 

revenue by 

implementing 

proven solutions. 

Centralising back office functions like order intake, 

planning, accounts payable, accounts receivable and 

financial accounting/reporting can often be an effective 

cost reduction strategy. For shipping companies who are 

operating in a wide variety of locations worldwide however, 

centralising may be a good alternative to improve overall 

quality of services and make processes more efficient. 

Companies may also want to consider off-shoring in 

a country with relatively low labour costs. Centralising 

services and off-shoring are very complex projects which 

require significant advance planning. Management needs 

to consider how to make the case for shared services, what 

processes to include, and where the shared service centre 

should be located. 

Companies also need to ensure that they can manage 

the customer/service provider relationship and ensure 

the delivery of appropriate service levels. In addition, 

the organisation model, required technology and 

implementation approach should be considered. 

PricewaterhouseCoopers services and 


• Feasibility study 

• Selection of possible locations 

• Developing implementation plans 

• Performance reviews (post implementations 

reviews, benchmarking, audit and redesigns 

of shared services centres) 

• Dismantle of shared service centres 



How to 

succeed in 

outsourcing 

through 

strengthened 

governance* 

*connectedthinking 


7 Performance Improvement 

Collaborate & Innovate – A new world of sourcing 

Outsourcing is growing fast and delivering results. It is covering more parts of the business landscape, 

and gaining in complexity. Many challenges remain. Today’s market leaders are embracing collaboration 

and transparency to achieve the promise of productivity and performance in the outsourcing enterprise. 

In the spirit of collaboration, we invite you to share your experiences. 

How to succeed in outsourcing through strengthened governance 

Although the number of companies pursuing strategic outsourcing initiatives continues to rise, 

studies reveal that as many as half of these investments fail to return the benefits executives expect. 

Even a quick glance at the portfolio of risks that can derail an outsourcing initiative begins to provoke 

questions about how to manage outsourcing uncertainty – across political and country risk, contractual 

risk, operational risk, and cultural risk. Common reasons for outsourcing failures vary widely, but each 

can be traced back to a fundamental lapse in managerial oversight and control – in effect, to a failure 

in governance. In this whitepaper, we examine the most effective way to manage outsourcing risk. 

The white paper outlines the steps for establishing these centers of excellence and how to improve 

the overall value of outsourcing initiatives. 

35

8 Integrated 

IT Systems 

‘Automating the bridge’ 


Improving IT effectiveness for Shipping 

and Ports: Integration is key 

Technologies like the Internet, increasing band width 

(including the increase in the availability of band width), and 

standardisation of formats (XML) are making it possible 

for information to become available sooner and to be 

shared more easily. Using up-to-date information, getting 

rid of delays and using speed for competitive advantages 

are some of the results. IT technology is pushing new 

possibilities. Ports are integrating the flow of goods by 

means of Information & Communication Technology 

platforms, which optimise the processes in the transport 

chains. These systems use on-line information and 

communication services to boost the efficiency levels of 

customers. They also provide the ability to integrate within 

the supply chain, as forwarders, shipping agents and ship 

brokers are able to exchange information. Due to this, the 

current bulk of legacy software is getting more and more 

connected by means of interfaces, or the legacy software is 

being replaced by integrated systems (like ERP systems). 

Although technology is offering new possibilities, it also 

introduces new issues in the field of security, connecting 

communities on standards and replacing the still-used 

legacy systems. Addressing these issues while ensuring 

that ongoing business runs smoothly presents a serious 

challenge. 

PricewaterhouseCoopers IT integration services 


• IT Security and Controls 

• Development and implementation of security 

solutions and controls that mitigate risks 

and vulnerabilities. 

• Project management and project assurance 

• Structured software selection 


Tracking and tracing to the next level 

8 Integrated IT Systems 

• Due to a lot of practical experience, PwC is able 

to build bridges between issues facing a client 

and software solutions that fit their company. 

• Pre-implementation assurance (PIA) is an 

independent assessment of a client’s project. 

PIA looks at the health of the project itself, 

whether the expected outcome of the project 

or change initiative is realised and whether the 

Go Live is endangered. PIA intends to reassure 

management that a project will accomplish 

its desired outcome. 

International supply chains have a complex and dynamic 

nature. Accurately tracking and managing the flow of goods 

is therefore challenging and costly. Due to the multi-party 

and multi-modal nature of the global supply chain, many 

shippers face challenges such as security threats (including 

misplacement, theft, product tampering, and illegal or even 

terrorist uses) and inefficient use of labour and equipment 

for tracking goods and containers. 

Radio Frequency Identification (RFID) is a technology that is 

being used today for automatic identification and traceability 

through supply chains. It enables significantly improved 

visibility and helps move goods more efficiently through the 

global supply chain. It differs from barcodes because RFID 

requires no line of sight. A variant of RFID uses active tags 

containing a battery, which are used in Real Time Location 

Systems (RTLS). Apart from identification, the RFID tag is 

also used to determine the exact location of the goods. 

In addition, the battery power enables the recording of 

vibrations, shock, temperature or movement. 

37

PricewaterhouseCoopers Tracking services 


• It effectiveness and IT alignment 

• Analysing processes, benchmarking, identifying 

process improvement 

• Opportunities, determining return on investments 

• Technology, software and technology 

partner selections 

• Project support, project management, 

change management 

• Audit and evaluation 

Information Communication Technoly 

(ICT) in control 

The IT environment is becoming less complex: user 

interfaces are becoming more user-friendly and the 

accessibility of computer systems is increasing. On the 

other hand, complexity is increasing due to the tendency 

of outsourcing IT services, information integration and 

real time availability of information. 

These aspects have specific requirements to the 

organisation and the management of IT. One of the most 

important and difficult challenges will be to align IT with 

the business objectives. 

The most common issues originate from the area of 

business and IT alignment, cost control, outsourcing, and 

shared service centres. The question is how to get in control 

and stay there. 

PricewaterhouseCoopers ICT services 


• IT Effectiveness: Business and IT alignment, based 

on the COBIT framework 

• Performance Improvement: Through business 

measurement, benchmarking 

• IT Business Risk Management: Helps companies 

identify and address IT business risks and align IT 

spending with business goals 




IT Governance in Practice – Insight from leading CIOs 

PricewaterhouseCoopers has interviewed a number of CIOs worldwide to obtain their views on 

IT governance, their experience in implementing IT governance, and what it takes to make IT 

governance work. 

From our interviews it is evident that most organisations recognise the importance of IT governance. 

However, a “holistic” view that considers all dimensions of IT Governance is not widely found. The 

concept of IT governance as an umbrella framework encompassing a wide spectrum of arrangements, 

including the measurement of benefits, has yet to emerge. 

We have included in our report some examples of best practices we have identified. 

8 Integrated IT Systems 

A united front – Post-merger or acquisition alignment of IT cost management 

As soon as the deal has been closed the real work starts: the integration. This is a much-heard 

comment in the world of mergers and acquisitions. A study by PwC shows that, in 89 percent of 

merger and acquisition cases, the IT function is subject to post-deal integration in some form or other. 

IT integration issues will be the order of the day in the next few years considering the expected wave 

of mergers and acquisitions. The positive effects of this integration will, however, have to be manifest. 

Financial alignment within the ICT organisation is an important tool for achieving transparency, cost 

awareness and focus on the best price/quality ratio of ICT services. 

The global state of information security 2007: 

Organisations are strong on infrastructure but weak on monitoring and enforcement 

Organisations worldwide are investing in infrastructure but lagging in implementation, measurement and 

review of security and privacy policies according to the 5th annual Global State of Information Security 

Survey 2007. According to the survey, the majority of organisations now have a CSO or CISO in place 

(60% in 2007 vs. 43% in 2006), as well as an overall information strategy (57% in 2007 vs. 37% in 2006), 

and results show the majority are also heavily invested in technology safeguards. Other findings show 

that IT is taking budgetary control in 2007, with the majority (65%) of information security budgets now 

coming directly from the IT department. 

39

9 Creating 

a sustainable 

maritime business 

‘Our responsibility 

to the maritime 

future’ 


Enhancing sustainability in your business 

Shareholders expect your company to generate profits. 

But, they also want your company to make a positive 

contribution to society while minimising any negative 

effect it might have on the environment. This approach to 

business – balancing economic interests against social 

and environmental concerns – is commonly referred to 

as sustainability. Over the past decade, sustainability has 

moved from the fringes of the business world to the top of 

shareholders’ agenda. The concept of sustainability has 

gained traction among corporate employees, regulators, 

and customers, too. Consequently, any miscalculation 

or misjudgement of matters related to sustainability can 

have serious repercussions on how the world judges your 

company and values its shares. 

For corporate management, finding the right balance among 

competing economic, social, and environmental goals is the 

essence of “responsible leadership”. In practice, responsible 

leadership means integrating ethical considerations into 

company decision-making, and managing on the basis of 

personal integrity and widely-held organisational values. 

Responsible leaders manage for the common good and gain 

authority and legitimacy in direct proportion to their success 

in serving others. 

PricewaterhouseCoopers sustainability services 


• Corporate Social Responsibility strategy design 

and deployment 

• Reporting and assurance of non-financial 

information 

• Climate change and emissions trading 

• Transaction support for environmental health 

and safety and reputation issues 

• 

Supply chain risk management 


9 Creating a sustainable maritime business 

Climate change and the shipping industry 

Climate change has emerged as one of the most important 

political and business issues of our time. Transportation 

accounts for 22% of greenhouse gas emissions caused by 

energy consumption. Governments are increasingly taking 

measures to promote emission reduction initiatives, such as 

environmental taxes, subsidies and incentives, negotiated 

agreements with industry, or emission trading schemes. 

Carbon dioxide emissions from shipping are thought to 

be double those of aviation and could rise by as much as 

75% in the next 15 to 20 years if world trade continues to 

grow and no action is taken. Shipping has thus far been 

spared any significant cuts as CO2 emissions from ships 

do not come under the Kyoto Agreement or any proposed 

European legislation. But pressure is mounting on all sides 

for the situation to change. The European Commission 

announced in 2007 that it would increase efforts to curb the 

shipping industry’s contribution to climate change. Whilst 

the focus of planned legislation will be on the reduction 

of air pollution, the Commission is also investigating an 

inclusion of the shipping industry in the existing carbon 

dioxide emissions trading scheme. 

PricewaterhouseCoopers has been working with policy 

makers and companies since 1997, helping to analyse 

issues and develop practical solutions for our clients. 

With a network of more than 150 professionals across 

Europe, the Americas and Asia Pacific, PwC offers a 

broad range of advisory, assurance and professional 

services that collectively guide clients through the 

complexities of climate change and emissions trading. 

41

PricewaterhouseCoopers climate change services and 


• Strategy formulation 

• Carbon finance and transactions 

• Clean development mechanism and joint 

implementation project design and development 

• Carbon risk management and health check 

• Greenhouse gases data management, reporting, 

and verification 

• Public policy and delivery 


Building trust in emissions reporting 

This report highlights the key characteristics of the world’s main emission trading schemes, 

presents a new vision for compliance in emissions trading and calls for global action to develop 

this.Key to this trust are the three central criteria of transparency, accountability and integrity. The 

PricewaterhouseCoopers report looks at how the patchwork of trading schemes that are emerging 

around the globe stacks up against these criteria. Despite good intentions across the board, the general 

picture is one of new and immature markets, inconsistent and complex compliance frameworks and 

risk. PricewaterhouseCoopers make the case for urgent and coordinated action to develop a framework 

of generally accepted principles and practice that will underpin trust and efficiency in these new markets 

– in effect, a new Global Emissions Compliance Language. 

The Sustainability Yearbook 2007 

For the fourth consecutive year, PricewaterhouseCoopers (PwC) and SAM Group presented the 

Sustainability yearbook 2008 at the World Economic Forum (WEF) in Davos. The Sustainability yearbook 

is the world’s most comprehensive publication on sustainability and the related challenges and 

opportunities for companies. In addition, it addresses the current and future challenges for companies 

in 57 specific industry sectors. The Sustainability yearbook 2008 also highlights the global challenge 

posed by water use, as well as a chapter about Eco-design showing how factoring the ecological 

consequences of a given design (resource consumption, noxious emissions, recovery potential) into 

product development, integrates the environment into the value chain. 



43

Our position 

Piloting the fleet in the Shipping & Ports industry 

Industry-wide, PwC has got a dominant standing within 

the market for professional services. When looking at the 

largest companies within the Transportation & Logistics 

industry worldwide (corresponding to the latest Fortune 500 

ranking), PwC was able to gain an audit market share of 

approximately 40%. 

Within the global PwC network, a clear and competent 

leadership team has been formed. Headed by our Global 

T&L Industry Leader, our industry organisation is split up 

into industry sub-sectors mainly. 

Narrowing the perspective to the shipping and ports 

sub-sector, PwC has acted as independent auditor at many 

renowned corporations, such as: 

Hapag Lloyd Container Line, COSCO - China Ocean 

Shipping Company, CMA CGM Group, APL - American 

President Lines, OOCL - Orient Overseas Container Lines, 

CSAV Group - Compania Sudamericana de Vapores, CSCL 

- China Shipping Container Liners, STX - Pan Ocean, NOL - 

Neptune Orient Line, HMM - Hyundai Merchant Marine, Port 

of London Authority, Forth Ports, Hutchison Ports, British 

Ports Authority, Angelicoussis Shipping Group, Navios 

Maritime Holdings, and Danaos Corporation. 

PwC’s strong audit position in the shipping sector is 

reflected in its high market share. 

Besides the audit engagements, our Shipping & Ports 

experts have performed advisory works for port authorities 

and operators as well as shipping companies around the 

world. The following list of selected assignments shows their 

hands-on expertise: 

• OIL - Orient Overseas International - International tax 

structuring 

• COSCO - China Ocean Shipping Company - Hong 

Kong tax compliance, internal control assessment, 

IPO assistance 

• Port of Rotterdam - Competitiveness analysis 

• Port of le Havre - Estate portfolio improvement, Regional 

Development Strategy 

• Port of Brisbane - Container Port Pricing Study, Port 

strategy formulation 

• Port of Rotterdam - Analysis of the competitive 

position of the port of Rotterdam for international mobil 

investment projects, Strategic analysis of changes in the 

business environment - Organisational diagnostic 

• Port of Bordeaux - Business Development and Future 

Development Strategy 

• Port of Saint Petersburg - Strategic Review of the Port of 

Saint Petersburg 

• Port Singapore Authority - Optimal structure for the Port 

of Singapore (PSA) 

• Port Authority Dubai - Jebel Ali Free Zone Strategy 

• European Commission - Analysis of the port 

development in the Baltic States 

• Port of Tallinn - Valuation of land of Old City port and 

Muuga Harbour 

• World Bank - Enterprise Restructuring Plan for 

Luka Rijeka 

• Sealand Seaports - Feasibility Westerschelde Container 

Terminal in Flushing 

• European Port Authorities - Benchmarking of port 

concession prices for land and quays in the HLH-range 

• Hutchison Ports Holding - Strategic market analysis for 

the EU merger task force (DG IV) 


Audit market share analysis* 

T&L Fortune 500 Top 50 shipping companies 

16% 

11% 

31% 


2% 

40% 

21% 

21% 

4% 

24% 

30% 

PwC 

E&Y 

DTT 

KPMG 

Other 

* Market share figures are weighted by the total group revenues from the companies included in the analysis. 

Our position 

45

What 

differentiates 

us 

PricewaterhouseCoopers has an unparalleled network of 

expertise across 150 countries. In addition, our approach 

to support essential business decisions in the Shipping and 

Ports industry has four key points of difference: 

Thought leadership 

We help you objectively assess the various opportunities 

in your reach. Our approach is based on in-depth industry 

knowledge and helps you to be realistic about specific 

industry changes. Our expertise is an integrated part of 

the PwC collaborative network of Transport & Logistics 

consultants with various publications in the fields of 

Shipping & Ports, Rail & Infrastructure, Logistics & Post, 

Airlines & Airports. 

Our integrated network of industry specialists 

No other firm is able to draw upon such a pool of 

connected expert resource. The combination of objective 

assessment by our central industry team, combined with 

local knowledge, first-hand experience and linkage with 

functional PwC specialists (financial, M&A, tax, HR, risk 

management, performance improvement, etc.) allow to 

address most efficiently the various aspects of the business 

decision in all areas where needed. For this purpose, PwC 

adopted the idea of Connected Thinking. This is a unique 

differentiator that expresses the way we join together in 

sharing knowledge so that we can find the best solutions 

for our clients. 

Our practical and logical approach 

PricewaterhouseCoopers uses its expertise to develop a 

pragmatic approach which is tailored to support each type 

of complex business decision. We provide guidance in the 

decision process by structuring, assessing, and prioritising 

the alternative strategic responses turning your strategy into 

reality. 

Specialists on site 

The vast network of worldwide PricewaterhouseCoopers 

offices allows us to call upon additional expertise where 

needed. Backed by high quality professionalism, we can 

offer a complete consultancy package to provide our clients 

with the specialist advice they expect from a leading 

international adviser. As opportunities are closely related 

to their specific market place, by consequence, a profound 

knowledge of the market place is key. Therefore industryspecific 

competence centres and specialists are where 

your business is. 


About PwC 

We are structured as a network of member firms, connected 

through membership in PricewaterhouseCoopers 

International Limited. PricewaterhouseCoopers’ member 

firms operate locally in countries around the world. But by 

working together, member firms also comprise a vigorous 

global network. This structure provides PwC firms with the 

flexibility to operate simultaneously as the most local and 

the most global of businesses. As a direct result, we are 

able to serve a broad range of clients: large, publicly-listed 

multinationals; small, private, domestic companies; and 

almost everything in between. 

Most large PwC firms achieved double-digit revenue growth 

for a second consecutive year in fiscal year 2007. Gross 

aggregated revenues for PwC firms worldwide totalled USD 

25.2 billion. The aggregate growth in revenues at constant 

exchange rates was 11%. In US dollar terms, the growth 

rate was somewhat lower, at 10.5%, reflecting the fact that 

certain foreign currencies declined in value against the US 

dollar during the year. 

Continued strong economic conditions around the world 

helped drive robust growth in work for non audit clients 

and in transaction-related services during fiscal year 2007. 

An analysis of the worldwide results by service line shows 

that the fastest growth was in Advisory services (14.6% in 

local-currency terms), while Tax services also performed 

very well, with aggregate revenues growing by 15.1% in 

local currency terms. The rate of growth in Assurance 

services moderated to 6.7% in local currency terms. PwC 

firms performed well in all of our major geographic markets. 

Member firms in nearly all of our major regions boasted 

double digit growth rates. Particularly good results were 

achieved in Central and Eastern Europe which saw revenues 

increase by 22.4%, while South and Central America 

enjoyed revenue growth of 19.1%. Our Asian firms also 

recorded strong growth of 18.8% – driven by particularly 

good results from China. 


PricewaterhouseCoopers has been created by the merger 

of two firms – Price Waterhouse and Coopers & Lybrand – 

each with two additional strengths: a deep understanding of 

local markets; and the sense of individual responsibility and 

initiative that comes from having a stake in the practice. 

The unit of organisation most critical to our success is also 

its smallest and most fluid: the client engagement team. 

Much of the decision-making authority relating to how client 

needs are met rests with engagement teams. The team also 

has primary responsibility for building and expanding client 

relationships. 

And the team is where much of our people’s professional 

development occurs and PwC’s culture is passed to 

younger professionals. As a consequence, each piece of 

the PwC network shares a single, overriding aim: to help 

engagement teams connect with clients, win work, and 

mentor the next generation of leaders. 

PricewaterhouseCoopers has member firms 

in 766 offices in 150 countries 

PricewaterhouseCoopers people as of June 2007 

Partners 8,578 

Client Service Staff 108,926 

Practice Support Staff 29,263 

Total 146,767 

47

We are 

where you are 

Global Transportation & Logistics 

Industry Leader 

Klaus-Dieter Ruske, +49 211 981 2877 

klaus-dieter.ruske@de.pwc.com 

Global Shipping & Ports Leader 

Michel Adriaansens, +31 10 4075 271 

michel.adriaansens@nl.pwc.com 


Business Development 

Peter Kauschke, +49 211 981 2167 

peter.kauschke@de.pwc.com 


Knowledge Management 

Usha Bahl-Schneider, +49 69 9585 5425 

usha.bahl-schneider@de.pwc.com 

Australia 

Don Munro, +61 2 8266 7328 

don.munro@au.pwc.com 

Belgium 

Peter van den Eynde, +32 3 259 33 32 

peter.van.den.eynde@be.pwc.com 

Canada 

Michael Whitworth, +1 514 205 5269 

michael.whitworth@ca.pwc.com 

Central and Eastern Europe 

Nick C. Allen, +420 251 151 330 

nick.allen@cz.pwc.com 

China 

Thomas Leung, +86 10 6533 2838 

thomas.w.leung@cn.pwc.com 

Cyprus 

Liakos Theodorou, +357 (0) 25 555 201 

liakos.theodorou@cy.pwc.com 

Denmark 

Bo Schou-Jacobsen, +45 39 45 36 39 

bo.schou-jacobsen@dk.pwc.com 

France 

Jean-François Châtel, +33 1 56 57 83 25 

jean-francois.chatel@fr.pwc.com 

Germany 

Klaus-Dieter Ruske, +49 211 981 2877 

klaus-dieter.ruske@de.pwc.com 

Greece 

Socrates Leptos-Bourgi, +30 2104284000 

socrates.leptos.-.bourgi@gr.pwc.com 


Hong Kong 

Alan Ng, +852 2289 2828 

alan.ng.@hk.pwc.com 

India 

Amrit Pandurangi, +91 11 5135 0505 

amrit.pandurangi@in.pwc.com 

Indonesia 

Thomson Batubara, +62 21 5289 0400 

thomson.batubara@id.pwc.com 

Italy 

Luciano Festa, +39 6 57025 2465 

luciano.festa@it.pwc.com 

Japan 

Yasuhisa Furusawa, +81 36 266 57 33 

Yasuhisa.furusawa@jp.pwc.com 

Kenya 

Vishal Argawal, +254 20 2855581 

vishal.argawal@ke.pwc.com 

Luxembourg 

Anne Murrath, +352 4948 481 

a.murrath@lu.pwc.com 

Malaysia 

Azizan Zakaria, +603 2173 0512 

aziizan.zakaria@my.pwc.com 

Mexico 

Martha Elena Gonzalez, +52 55 5263 5834 

martha.elena.gonzalez@mx.pwc.com 

The Netherlands 

Jeroen Boonacker, +31 (0)10 407 53 30 

jeroen.boonacker@nl.pwc.com 


New Zealand 

Grant Burns, +64 9 355 8034 

grant.burns@nz.pwc.com 

Norway 

Tore Eriksen, +47 (0) 95 26 02 26 

tore.eriksen@no.pwc.com 

Philippines 

Rodel Acosta, +63 2 8452728 

rodel.acosta@ph.pwc.com 

Portugal 

Jorge Costa, +351 (0) 213 599414 

jorge.costa@pt.pwc.com 

Russia 

Tony Antoniou, +7 495 9676386 

tony.antoniou@ru.pwc.com 

South East Europa 

Momchil Vasilev, +359 2 93 55 301 

momchil.vasilev@bg.pwc.com 

Singapore 

Subramaniam Iyer, +65 6236 3058 

subramaniam.iver@sg.pwc.com 

South Africa 

Akhter Moosa, +27 12 429 0546 

akhter.moosa@za.pwc.com 

South and Central America 

Henrique Luz, +55 11 3674 3601 

henrique.luz@br.pwc.com 

South East Cluster 

Momchil Vasilev, +359 2 93 55 301 

momchil.vasilev@bg.pwc.com 

1 We are where you are 

49

Spain 

Ignacio Fernandez, +34 915 684 780 

ignacio.fernandez.morodo@es.pwc.com 

Sweden 

Claeys Thimfors, +46 31 7931131 

claes.thimfors@se.pwc.com 

Switzerland 

Rodolfo Gerber, +41 58 7925536 

rodolfo.gerber@ch.pwc.com 

Taiwan 

Joseph Chou, +886 2 27296666 6693 

joseph.chou@tw.pwc.com 

Turkey 

Cenk Ulu, +90 212 3266060 

cenk.ulu@tr.pwc.com 

United Arab Emirates 

Nathan Weatherstone, +97 150 771 2906 

nathan.weatherstone@ae.pwc.com 

United Kingdom 

Clive Hinds, +44 1727 892379 

clive.p.hinds@uk.pwc.com 

United States of America 

Kenneth Evans, +1 305 375 6307 

kenneth.evans@us.pwc.com 


Contact 

Please contact your local specialist to receive further information regarding our 

Global Shipping & Ports practice at PricewaterhouseCoopers. You may also use 

this contact list to order any of the industry publications mentioned through out 

this document. 

PricewaterhouseCoopers provides industry-focused assurance, tax and advisory services for public and private clients. More than 146,000 people in 150 countries connect their thinking, 

expertise and solutions to build public trust and enhance value for clients and their stakeholders. Our Transportation & Logistics practice is a global network of partners and client service 

professionals dedicated to shipping companies and port operators, airlines and airport operators, rail operators as well as postal, express and logistics service providers. 

Hoisting pwc.com/transport the sails 

Assurance • Tax • Advisory 51 

1 Titel

Hoisting the sails - PwC

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