had affected a distinct legal institution in former colonies today, which had been imported by different colonial powers. At the same time, even among former colonies governed by a same colonizer, current institutional quality greatly varies because of distinctive local culture and cultural norms. There is a connection between degrees of success in the institutional transfer and the current disparities in institutional quality in former colonies. For example, for Singapore, South Africa, and Pakistan, Britain was the colonial mother country in his paper, but using a resulting aggregated indicator<sup>2</sup> to measure the quality of the instructional framework, its scores varied, 1.57, 0.41, and -1.09, respectively. Therefore, countries with similar colonial influence rarely have the same regulatory framework in their statutory laws.

# **III. Classification of regulations for freight forwarders**

This note focuses on the regulations relevant to freight forwarding business. Logistics services can be offered by specialized operators such as trucking companies or customs clearing agents. However, little research has been done on the freight forwarding business despite its importance as a facilitator for the seamless movement of goods. Taking the official description of freight forwarding and logistics services by FIATA into account, this note narrows down its definition to help understand the regulatory complexity.

Different regulators such as government authorities or industry associations have different levels of legal enforcement power on logistics operators. Regulations outline the requirements for operators to start their business (market entry / access) and to operate their business (operations). In addition, foreign operators often encounter additional formal requirements while domestic operators do not, but self-regulations can be equally applied to all operators. Annex 1 summarizes this clarification.

# **1) Definition of freight forwarder in this note**

This note focuses on the regulations that affect freight forwarding business and its service providers. Freight forwarding provides comprehensive logistics services. According to the FIATA Model Rules for Freight Forwarding Services,<sup>3</sup> freight forwarding services are defined as follows: “ _services of any kind relating to the carriage, consolidation, storage, handling, packing or distribution of the Goods as well as ancillary and advisory services in connection therewith, including but not limited to customs and fiscal matters, declaring the Goods for official purposes, procuring insurance of the Goods and collecting or procuring payment or documents relating to the Goods.”_ Recognizing the functions of freight forwarders described in the FIATA definition, it is commonly known that freight forwarders often provide clients with a combination of the services shown in Figure 1. However, in some countries, freight forwarders do not always provide customs clearing services. For example, African countries often have clearing and forwarding (C&F) agents. Some of them provide both customs

> 2 Originally the World Bank dataset uses six aggregate, perception‐based indicators to measure institutional quality. Each indicator ranges from ‐2.50 (least efficient institutional quality) to +2.50 (best quality) and is based on empirically collected data sources. The six indicators are interrelated.

> 3 http://fiata.com/uploads/media/Model_Rules_07.pdf

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