TFS Tariff Structure & Economic Impact Assessment

Beck on October 7, 2015. The TFS system is a highly interdependent system that relies on reliability and efficiency to function effectively. The system is characterized as competitive and conservative, with a risk-averse industry. The TFS system has several key links, including transmission to customs, discharge approvals, discharge, release order, and paper processing. Each link presents an opportunity for benefit per TEU (Twenty Foot Equivalent Unit), with benefits becoming additive. The total industry benefits for the TFS system in Georgia are estimated to be 4.55 GEL per TEU, with a total value of 1,030,917 GEL based on 2014 import volumes of 266,394 TEUs. The TFS system is expected to benefit members of Georgia's logistics community and the TEUs they handle. The benefits per TEU are estimated to range from 2.00 to 10.00 GEL, depending on the volume of TEUs handled. The system is expected to capture entire sample except Poti Port at a fee of 0.13 GEL, with revenues around 50,000 GEL. At a fee of 0.24 GEL, the system is expected to capture 50% participation, with revenues around 80,000 GEL. However, as the fee increases, the system's effectiveness breaks down. At a fee of 0.70 GEL, the system is expected to lose ports, off-docks, and efficient shipping lines, with revenue around 175,000 GEL. At a fee of 1.27 GEL, the system is expected to lose ports, off-docks, and the majority of shipping volume, with revenue around 65,000 GEL. The sensitivity analysis of the fees shows that the system's benefits break down at low participation rates. The system is expected to lose effectiveness as key links drop out, with the system's benefits becoming less significant at higher fees. The system's revenue is expected to decrease as the fee increases, with the system losing revenue at high participation rates. The TFS system's effectiveness is highly dependent on the fee structure, with the system's benefits breaking down at high fees. The system's revenue is expected to decrease as the fee increases, with the system losing revenue at high participation rates. The system's effectiveness is expected to break down as key links drop out, with the system's benefits becoming less significant at higher fees.