gaborone, botswana february, 2009 - u.s. agency for international
TRANSCRIPT
P.O. Box 602090 ▲Unit 4, Lot 40 ▲ Gaborone Commerce Park ▲ Gaborone, Botswana ▲ Phone (267) 390 0884 ▲ Fax (267) 390 1027 E-mail: [email protected]
Technical Report:
Review of the Customs & Excise Legislation of Lesotho Revenue Authority (LRA) – Phase One
Ranga Munyaradzi – Senior Customs Advisor Timothy Chisembwere – Short Term Customs Consultant
Submitted by: AECOM International Development
Submitted to: USAID / Southern Africa
Gaborone, Botswana
February, 2009
USAID Contract No. 690-M-00-04-00309-00 (GS 10F-0277P)
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I. EXECUTIVE SUMMARY ........................................................... 3
II. INTRODUCTION ....................................................................... 4 III. OBJECTIVES: ........................................................................... 4
IV. HIGHLIGHTS:............................................................................ 4
V. ISSUES AND RECOMMENDATIONS:...................................... 8
ANNEX 1: LIST OF CONTACTS ANNEX 2 (a): SECTIONS OF THE CUSTOMS AND EXCISE ACT THAT WERE AMENDED ANNEX 2 (b): SECTIONS OF THE CUSTOMS AND EXCISE REGULATIONS THAT WERE AMENDED ANNEX 3: COMPARISON TABLE OF THE GENERAL ANNEX OF THE REVISED KYOTO CONVENTION VIS-À-VIS LESOTHO REVENUE AUTHORITY CUSTOMS LEGISLATION
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EXECUTIVE SUMMARY The Southern Africa Global Competitiveness Hub (Trade Hub) conducted a study of current Lesotho Customs Legislation to see if it complies with international standards and best practices. The key findings showed that Lesotho Customs Legislation is not compliant with international best practice, especially with most provisions of the WCO Revised Kyoto Convention. In addition, the following provisions were also found not to be compliant with international best practice:
1. No separation of Customs and Excise Sections in legislation; 2. Customs Operations at the One-Stop Shop (OSS) not provided for in Customs
Legislation; 3. Non-Availability of Customs Legislation and Amendments; 4. Standard Operation Manuals not up-to date and not available to Officers; 5. Customs Processes not automated; 6. No Risk Management and Post Clearance Audit as envisaged in the WCO
Revised Kyoto Convention; 7. Non Clearance of Empty Containers on export at Maseru Container Terminal; 8. Non Clearance of Exports by Post; 9. Inadequate Training Program; 10. Rebate and Excise Manufacturers inspected only once a year and Officers at
times not available to witness destructions of off-cuts and excisable products; and 11. State warehouse (SWH) Rent and Fines for Customs Offences too low.
The Trade Hub team made an interim presentation of findings and recommendations to the Commissioner, his Deputies and other Senior Management Staff. After the presentation, the Commissioner of Customs and Excise asked the Trade Hub to proceed with a modernization program as part of the technical assistance program. The Trade Hub was asked to:
1. Re-design and re-draft the Customs and Excise Act, followed by the Regulations and Operational Procedures. The LRA Legal Section would provide guidelines on the format, layout etc.
2. In partnership with the WCO, conduct WCO Time Release Study. 3. Assist in Capacity Building, using the modernized legislation.
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INTRODUCTION: In August 2008, the Commissioner of Customs and Excise in the Lesotho Revenue Authority requested technical assistance from the Southern Africa Global Competitiveness Hub (Trade Hub) to review and modernize Customs Legislation, Regulations, Procedures and Processes. The background to this was that Lesotho had acceded to some international trade facilitation conventions which they were unable to factor in the Customs laws, policies and procedures. The World Customs Organization (WCO) was a good example of this scenario. The Terms of Reference given were:
1. Review and re-engineering of Customs business processes in order to enable speedy clearance of goods and enhance Customs enforcement/control capability;
2. Development of standard operating procedures using internationally accepted best practices and standards. (i.e. in terms of the WCO Revised Kyoto Convention);
3. Review and documentation of user manuals linked to the reviewed Customs processes and procedures;
4. Development of guidelines on re-engineered Customs processes and procedures for Customs clients;
5. Conduct a WCO Time Release Study; and 6. Training of Customs Officials.
OBJECTIVES: To assess current import and export procedures and legislation applied by LRA Customs with a view to modernizing them in line with international standards and best practice. HIGHLIGHTS: Meeting with the Commissioner of Customs and Excise The first engagement was a meeting of the Trade Hub team and the Commissioner of Customs and Excise, Mr. Thabo Letjama, which discussed the modalities of implementing the technical assistance request. It was agreed that the first phase should be an assessment of current Customs legislation, regulations, procedures, processes and administrative procedures – importation of goods by road, rail air and postal services, excise management, goods in transit and in bonded warehouses. The Commissioner of Customs appointed a ten – member Customs Committee, composed of senior Customs Officials, who were to work with the Trade Hub team. The Commissioner arranged for the Trade Hub team to be given copies of the Lesotho Customs and Excise Act, Regulations, Operational Manuals, Departmental Instructions to Officers and other directives issued by the Commissioner of Customs and Excise Meeting with the Commissioner-General of Lesotho Revenue Authority The Trade Hub team and the Commissioner of Customs met the Commissioner-General of Lesotho Revenue Authority, Dr. Charles Jenkins on January 28, and briefed him on the team’ mission.
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Meeting with the US Ambassador to Lesotho On 6 February 2009, the Trade Hub team met the US Ambassador to Lesotho, Mr Robert Bernard Nolan and his staff. The team gave an overview of the Trade Hub’s activities and briefed the Ambassador on the team’s technical assistance program to LRA. The Ambassador was pleased with the work done by the Trade Hub, in particular the technical assistance to Lesotho and indicated his intention to visit the Trade Hub’s Gaborone office in the near future. Visits to Operational Areas Maseru Bridge Border Post The Trade Hub team was accompanied by the LRA Manager, Freight for the visit to the Maseru Bridge Border Post to observe the clearance procedures applied in practice. The team was advised that the border post opens 24hours a day and processed about 500 import declarations a day. However, the team noted that all Customs procedures were manual and the lack of automation of these procedures was affecting the effective application of risk-based Customs controls and Customs management systems in general. The computers installed in Customs Offices at the border were used mainly for data capture of VAT claims. The team also noted that there was need to improve the skills of the officers involved in the valuation of used motor vehicles to avoid arbitrary valuation which is against the principles of the WTO Agreement on Customs Valuation. Maputsoe Border Post Maputsoe Border Post just like Maseru Bridge operates 24 hours a day and processes an average of 400 intra-SACU entries and 20-25 extra-SACU entries per day. Similarly, operations at this border are manual and there was need for automation. The officer in charge at the border was concerned at the lack of Standard Operating Procedures (SOPs) which affected the uniformity of operations within LRA Customs. The team observed that at both Maseru and Maputsoe Border Posts officers were provided with HS Explanatory Notes which are useful for the classification of goods but there were no other publications were available for use as reference material. The officer–in-charge was also concerned about the lack of further training for officers as so far, officers had only undergone 5-day basic Customs training since joining LRA. She also looked forward to the amendment and review of the legislation which was not up-to-date as officers had not been receiving any amendments from head office. She also suggested that the implementation of the One-Stop-Border concept with South Africa be speeded up so as to facilitate the movement of cargo and travelers through the border. Maseru Post Office The Trade Hub team noted that LRA officers only cleared intra and extra-SACU imports by post. Exports by post are not cleared by LRA and there is a danger that prohibited or restricted goods could be exported through the post office as they were no controls on such exports. The officers were not sure about which Customs legislation applied to imports by post. In discussions that followed, officers advised that they needed SOPs with clear procedures on how to clear goods at the Post Office. In addition they needed formal
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Customs training as they had only received on-the-job training so far. Training in tariff classification, customs valuation and drug identification was required. Regarding remittances by the Post office to LRA, the team was advised that sometimes delays of up to 5 months were experienced. There is need for legislation to address this problem to ensure that revenues collected by the postal authorities are remitted to LRA timeously. The Trade Hub team was concerned that little attention was given to health and safety issues as some of the officers had no dust coats or gloves and there was no First –Aid kit available. Excise manufacturers Prior to the visit, a member of the CWC gave an outline of excise management in Lesotho. The team was advised that all excise manufacturers are required to register and lodge a bond with LRA (ranging from M60 000 to M120 000) before they could commence production of excisable products. In addition, they were required to pay an annual license fee of M10. There is need to review the license fee and raise it to a more appropriate level under the current review exercise. In discussions that followed, the Trade Hub team noted that senior management at LRA lacked knowledge in excise management and had even removed excise officers from the brewery. According to the CWC member, the removal of the officers from the brewery had impacted negatively on excise receipts from the brewery as they had gone down. Within LRA, there are only 3 excise officers who are all based at head office, there is no training in excise and there are no SOPs on excise management developed by LRA, otherwise they rely on SARS guidelines. The Trade Hub team also noted the difficulty experienced by officers in identifying provisions in current legislation relating to excise management. The creation of a separate Chapter on excise management would address this problem and make the legislation (Customs and Excise Act & Regulations) more user-friendly. Lesotho Brewing Company The Trade Hub team and two members of the Customs Working Committee visited the brewery in Maseru. The brewery makes clear beer and aerated beverages but only clear beer is excisable. Discussions with the brewery staff showed that they required training in the completion of the excise return including excise forms. The Trade Hub team noted that although the company would update LRA on retail containers for beer, there was no update regarding the installation or removal of plant and equipment (e.g. storage tanks) as required by excise law. In addition, beer returned from the trade was at times destroyed in the absence of LRA officers and this impacted on excise revenue collected by LRA as the brewery claims refunds on such beer. Kiota Electronics (Pty) Ltd The team also visited this company which makes television sets and pays excise duty on a quarterly basis. The team also noted that the factory was only being inspected once per
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year by LRA officers and sometimes containers carrying raw materials were opened in the absence of LRA officers when they arrived at the factory. The officials at Kiota just like those at the brewery stated that they needed training in the proper completion of the excise return. The visit to Lesotho Brewing Company and Kiota Electronics reaffirmed the need for excise management training for both traders and LRA officers and the need for excise guidelines to assist traders and officers in carrying out their excise functions. Rebate manufacturers The Trade Hub team accompanied by two LRA Senior Customs officers visited Super Knitting (Pty) Ltd and Shining Century (Pty) Ltd, respectively, to see how they operate as registered manufacturers under rebate. The team noted that at Super Knitting control of the rebate store was very lax as doors to the store were wide open with no sign of the stores keeper and employees were seen walking in and out of the store and there were no stock cards on the stored fabrics to show the movement of stocks within the rebate store. Regarding rebate manufacturer inspections, the Trade Hub team noted that these were carried out only once every year. Such inspections should be carried out at least once per quarter as this will keep these manufacturers under check and has a deterrent effect. On the question of off-cuts, the team noted that manufacturers sometimes destroyed these in the absence of LRA Customs officials, although a destruction certificate signed by LRA was required. There is need for LRA Customs to improve the management and control of rebate manufacturers in order to properly safeguard revenue. Maseru Container Terminal The LRA Manager, Freight accompanied the Trade Hub team to the Maseru Terminal where containers (95% extra-SACU & 5% intra-SACU) are cleared. In discussions with officers at the terminal, the team noted that the officers were not clear about the proper clearance procedures for containers. For example, officers were not sure about the clearance of empty containers as it appeared that their office mainly cleared containers on import. This is because there are no SOPs on container clearance and furthermore, some of the officers had not received basic Customs training. Although the Officer-in-charge had stated that they had operating guidelines, she could not produce these to the team. The team also noted that the state warehouse rent charges needed review upwards to prevent abuse of the facility. One-Stop-Shop (OSS) in Maseru A member of the CWC accompanied the Trade Hub team to the OSS where LRA has 6 officers. The officers process export entries only. The team noted that there were no provisions in the Customs law or guidelines on LRA operations at the OSS as the OSS has not been designated as a port of entry.
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ISSUES AND RECOMMENDATIONS: Comparative analysis of WCO Revised Kyoto Convention and LRA Customs legislation The Trade Hub team made a presentation on the WCO Revised Kyoto Convention to members of the LRA Customs Working Committee which was then followed by a detailed presentation on the WCO template used for the comparative analysis. The presentations were followed by an exercise to update amendments to the Customs and Excise Act (No.10 of 1982) and the Customs and Excise Regulations, 1984. This was done after the Trade Hub team had noted that the legislation provided was not up to date and the fact that the gap analysis could not be undertaken using legislation which was not amended as this would affect the accuracy of the results. The Customs Working Committee appended to the Customs and Excise Act and Regulations all amendments promulgated between 1983 and 1995 and a list of these amendments is attached as Annex II. It is worth noting that only the legal officer had an amended copy of the Act but not of the regulations. The rest of the staff members had never had any of these instruments amended before and as a result, all the members of the CWC appreciated the importance of the exercise. After the amendment of the legislation, the CWC embarked on the gap analysis whose results are attached as Annex III. Summary of Key Findings and Recommendations Some provisions of the Customs and Excise Act and Regulations not compliant with the WCO Revised Kyoto Convention and other international / regional best practices
• These should be updated on the basis of international and regional instruments such as the Revised Kyoto Convention, SACU Model Customs Act and SADC Model Customs Act
No separation of Customs and Excise Sections in legislation
• Customs Legislation should clearly separate Customs provisions from Excise provisions to make it user friendly.
Customs Operations at the One-Stop Shop (OSS) not provided for in Customs Legislation
• Schedule 2 should be amended to cover Customs Operations at the OSS
Non-Availability of Customs Legislation and Amendments • Customs Legislation and promulgated Amendments should be made available
to all Officers if they are to be effective in their work
Standard Operation Manuals not up-to date and not available to Officers • Manuals should be updated once Amendments to Customs Legislation has
been promulgated and made available
Customs Processes not automated • There is urgent need to computerize Customs operations at all Offices
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No Risk Management and Post Clearance Audit as envisaged in the WCO Revised Kyoto Convention
• Establish Risk Management and Post Clearance Audit in terms of international best practice
Non Clearance of Empty Containers on export at Maseru Container Terminal • Establish proper export procedures at all offices
Non Clearance of Exports by Post
• Customs should also control exports by post as provided for in Section 13 of the Act
Inadequate Training Program • The 5-days basic training course needs to be re-designed and further training
is required for all Officers
Rebate and Excise Manufacturers inspected only once a year and Officers at times not available to witness destructions of off-cuts and excisable products
• Inspections to done once per quarter as deterrent to fraudulent claims • All destructions should be witnessed by Officers as this has revenue
implications • Excise Manufacturers should be trained on the proper completion of the
Excise Return
State warehouse (SWH) Rent and Fines for Customs Offences too low • SWH Rent and fines imposed in terms of the Act and Regulations should be
reviewed upwards with the forthcoming amendments to the Customs and Excise Legislation
Presentation of Findings to the Commissioner of Customs and Excise and a Way Forward The Trade Hub team made an interim presentation of findings and recommendations to the Commissioner, his Deputies and other Senior Management Staff. The Trade Hub team wanted guidelines on what LRA wanted as a way forward, so that the Trade Hub could proceed to prepare the final Report. After the presentation, the Lesotho Customs Management asked the Southern Africa Trade Hub to proceed with the resultant modernization program, and it was agreed that the Trade Hub will:
1. Re-design and re-draft the Customs and Excise Act, followed by the Regulations and Operational Procedures. The LRA Legal Section will provide guidelines on the format, layout etc.
2. Commence the re-drafting of the Lesotho Customs and Excise Act in Gaborone and it is envisaged that the Draft Customs and Excise Act and Regulations will be ready for hand-over to Lesotho Customs Authorities at end of April 2009. The Operational Procedures will be done later.
3. In partnership with the WCO, conduct WCO Time Release Study. The First Phase will be conducted during the week commencing March 9, 2009.
4. Assist in Capacity Building, using the modernized legislation.
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MEETING WITH THE LESOTHO NATIONAL DEVELOPMENT CORPORATION (LNDC) The Trade Hub team was accompanied to the LNDC meeting by Manthako Mpheli, the Economic /Commercial Specialist at the US Embassy. The LNDC was represented by Mr. Motebang Mokoaleli, the Head – Foreign Investment Promotion Division. The Senior Customs Advisor, Mr Munyaradzi, outlined the activities of the Trade Hub and explained the type of services that could be extended to the LNDC by the Trade Hub. In discussions that followed, it turned out that the LNDC would want to establish a formal working relationship with the Trade Hub through a Memorandum of Understanding which would see the Trade Hub acting as a resource centre for the LNDC, especially on:
• AGOA; • Other trade preferences extended to Lesotho; • The provision of monthly/quarterly reports of exports under AGOA by all eligible
beneficiary Sub Saharan countries, by value, quantity and product, as currently they have to pay a yearly subscription of USD 1000 for the supply of this information. However, the supply of this information was said to be erratic as they experienced frequent delays;
• New developments on AGOA, especially now that there is a new US administration in place;
• Understand garment products imported into the US by type of garment and tariff line, to enable the LNDC to identify potential garment exports to the US;
• General capacity building, e.g. to be assisted to participate at various Expositions held in the US; and
• Product standards, etc. The Trade Hub team noted the request by the LNDC and advised them to put it in writing. In this regard, the LNDC advised that it would consult with the private sector and forward its request to the Trade Hub by end of February. Mr Mokoaleli thanked the Trade Hub for their assistance so far, especially for the Exporters Guide and looked forward to establishing a formal working relationship with the Trade Hub. He also expressed his desire to visit the Trade Hub in the near future. ANNEXES:
• Annex 1 – List of Contacts • Annex 2 – Sections of the Customs and Excise Act and Regulations that were
amended • Annex 3 - Comparison Table of the General Annex of the WCO Revised Kyoto
Convention vis-à-vis Lesotho Revenue Authority Customs Legislation
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Annex 2 (a): Sections of the Customs and Excise Act that were amended: Section Provision Amending Instrument
2 Definition of “container Act No. 25 of 1986 6 Appointment of places of entry, authorized roads and
routes, etc Act No. 21 of 1986
7 Report of arrival or departure of aircraft Act No. 26 of 1986 9 Sealing of goods on board aircraft Act No. 26 of 1986
13 Goods imported or exported by post Act No. 26 of 1986 14 Persons entering or leaving Lesotho and smugglers Act No. 25 of 1986
Act No. 26 of 1986 19 Goods in Customs and Excise warehouses Act No. 4 of 1983 23 Aircraft stores consumed in Lesotho Act No. 3 of 1984 37 Special provisions in the manufacture of sales duty
goods and the collection of sales duty Act No. 21 of 1988
39 Entry of goods and time of entry Act No. 3 of 1984 40 Importer and exporter to produce documents and pay
duties Act No. 26 of 1986
41 Validity of entries Act No. 4 of 1983 Act No. 3 of 1984
42 Particulars on invoices Act No. 4 of 1983 Act No. 3 of 1984
44 Disposal of goods on failure to make due entry Act No. 4 of 1983 45 Liability for duty Act No. 25 of 1986
Act No. 21 of 1988 46 Determination of duty applicable Act No. 4 of 1983
Act No. 26 of 1986 48 Payment of duty and rate of duty applicable Act No. 4 of 1983
Act No. 26 of 1986 Act No. 21 of 1988
49 Amendment of Schedule No.1 Act No. 4 of 1983 55 Imposition of antidumping duties Act No. 25 of 1986
Act No. 21 of 1988 57 Provisional charge to anti-dumping duties Act No. 3 of 1984 58 Time when new or increased duties become payable Act No. 4 of 1983 60 Licence fees according to Schedule No.8 Act No. 4 of 1983 67 Value for fiscal and customs duty purposes Act No.4 of 1983
Act No. 26 of 1986 Act No. 21 of 1988
68 Normal price Act No. 4 of 1983 69 Value for excise duty purposes Act No. 4 of 1983
Act No. 26 of 1986 70 Value for sales duty purposes Act No. 4 of 1983 71 Value of certain specified goods Act No. 25 of 1986 72 Discretion of Director regarding determination of value
for duty purposes Act No. 25 of 1986
74 Conversion of prices Act No.4 of 1983 75 Value of goods not liable to ad valorem duty Act No. 4 of 1983
Act No. 26 of 1986
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Act No. 21 of 1988 76 Specific rebates, drawbacks and refunds of duty Act No. 4 of 1983
Act No. 25 of 1986 Act No. 26 of 1986 Act No. 21 of 1988
77 General refunds in respect of imported goods, excisable goods or sales duty goods
Act No. 4 of 1983 Act No. 3 of 1984
78 Overpayments in respect of excisable goods and sales duty goods
Act No. 4 of 1983
79 Offences not expressly mentioned Act No. 21 of 1988 80 Less serious offences and their punishment Act No. 21 of 1988 81 Serious offences and their punishment Act No. 4 of 1983
Act No. 25 of 1986 Act No. 21 of 1988
82 Non-declaration of goods Act No. 21 of 1988 84 Irregular export or carriage of munitions Act No. 21 of 1988 85 False documents and declaration Act No. 21 of 1988 86 Beer of higher or lower gravity than indicated by label
on container Act No. 21 of 1988
87 Certain specified offences Act No. 21 of 1988 96 Jurisdiction of the courts Act No. 21 of 1988 98 Container operator or pilot may appoint agent Act No. 25 of 1986 100 Liability of agent for obligations imposed on principal Act No. 4 of 1983 103 Sellers of goods to produce proof of payment of duty Act No.26 of 1986 107 Expenses of landing, examination, weighing, analysis,
etc Act No. 3 of 1984
112 Production of certificate of officer on registration of certain motor vehicles
Act No. 21 of 1988
115 Duty to the State constitutes a debt Act No. 26 of 1986 119 Statistics Act No. 21 of 1988
Annex 2(b): Sections of the Customs and Excise Regulations that were amended: Section Provision Amending Instrument Schedule 2 Item IV : “Moshoeshoe I international Airport” Legal Notice No. 72 of 1985
20 Rent to be paid on goods in a state warehouse Legal Notice No. 83 of 1994 38 Rent to be paid on goods in a state warehouse Legal Notice No. 83 of 1994 66 Charges for extra and special attendance Legal Notice No. 89 of 1995
Annex 3: COMPARISON TABLE OF THE GENERAL ANNEX OF THE REVISED KYOTO CONVENTION VIS-À-VIS LESOTHO REVENUE AUTHORITY CUSTOMS LEGISLATION
Legal Provision
Text Covered by National Legislation
Conflict with national legislation
General Comments
Basic Law
Regulation etc.
Standard 1.1.
Definitions: Standards and Transitional Standards
Customs and excise Act (1982)
Customs and Excise regulations (1984)
Review
Standard 1.2.
Definitions: Customs formalities to be accomplished for procedures
Customs and excise Act (1982)
Customs and Excise regulations (1984)
Review
Standard 1.3.
Definitions: Customs shall institute and maintain formal consultative relationships with the trade
Not covered
Not covered But covered in MOUs & Guidelines
Review
E1./ F23.
Definition: “appeal” Not covered
E2./ F19.
Definition: “assessment of duties and taxes”
Not covered
E3./ F4.
Definition: “audit-based control” Not covered
E4./ F15.
Definition: “checking the Goods declaration”
Not covered
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E5./ F9.
Definition: “clearance” Not covered
E6./ F10.
Definition: “Customs”; Not covered
E7./ F3.
Definition: “Customs control” Not covered
E8./ F11.
Definition: “Customs duties” Covered Needs modification
E9./ F16.
Definition: “Customs formalities” Not covered
E10./ F18.
Definition: “Customs law” ; Not covered
E11./ F2.
Definition: “Customs office” Not covered
E12./ F25.
Definition: “Customs territory” Not covered
E13./ F6.
Definition: “decision” Not covered
E14./ F7.
Definition: “declarant” Not covered
E15./ F5.
“due date” means the date when payment of duties and taxes is due;
Not covered
E16./ F12.
Definition: “duties and taxes” Covered Modify
E17./ F27.
Definition: “examination of goods” Not covered
E18./ F13.
Definition: “export duties and taxes” Not covered
E19./ F8.
Definition: “Goods declaration” Not covered
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E20./ F14.
Definition: “import duties and taxes”
Not covered
E21./ F1.
Definition: “mutual administrative assistance”
Not covered
E22./ F21.
Definition: “omission” Not covered
E23./ F22.
Definition: “person” Not covered
E24./ F20.
Definition: “release of goods” Not covered
E25./ F24.
Definition: “repayment” Not covered
E26./ F17.
Definition: “security” Not covered
E27./ F26.
Definition: “third party”
Not covered
Standard 3.2.
Customs charges for work outside the designated hours of business or away from Customs offices.
Reg 65 & 66
Modify
Standard 3.3.
Customs administrations shall correlate the business hours and the competence of offices.
Not covered
Amend to include hours
Transitional Standard 3.4.
Customs administrations shall, whenever possible, operate joint controls.
Not covered
To be addressed under bilateral agreement
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Transitional Standard 3.5.
Customs co-operate with the neighbouring Customs to establish a juxtaposed Customs office to facilitate joint controls.
Not covered
To be added
Standard 3.6.
National legislation shall specify the conditions under which a person is entitled to act as declarant.
Sec 14 (as amended), 39, 40, 66
Reg 15, 39, 40, 70 Align with the standard
Standard 3.7.
Any person having the right to dispose of the goods shall be entitled to act as declarant.
Sec 14 (as amended), 39, 40, 66
Reg 15, 39, 40, 70 Align with the standard
Standard 3.9.
Rights of the Declarant.
Sec 14 (as amended), 21&106
Reg 62 Modify to include the declarant . Sec 21 be modified to expand the scope beyond customs warehouses.
Standard 3.10.
Customs shall not require a separate Goods declaration on samples allowed drawn under Customs supervision
Sec 106 Modify by including in sec 106
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Standard 3.11.
Contents of the Goods declaration shall be prescribed by Customs.
Sec 40 Reg 39 Prescribe the SAD in the legislation reg 39. Legal framework for customs automated system.
Standard 3.12.
TCustoms shall limit the data required in the Goods declaration
Sec 41 Reg 39(3) Compare the UN layout key with the SAD document for alignment.
Standard 3.13.
A provisional or incomplete Goods declaration shall be allowed to be lodged
Not covered
Not covered To be included and aligned with the standard
Standard 3.14.
When Customs register a provisional or incomplete Goods declaration…….
Not covered
Not covered To be included and aligned with the standard
Standard 3.15.
Customs shall require the lodgement of the original Goods declaration
Sec 40(1)(b)
Reg 40 Specify in the regulations all supporting documents required to be original.
Standard 3.16.
In support of the Goods declaration the Customs shall require only those documents necessary to permit control of the operation
Sec 40(1)(c) 114(k)
Reg 40 Separate restrictions and prohibitions under sec 114. And align Sec 40 and Reg 40 with the Standard
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Standard 3.17.
Where certain supporting documents cannot be lodged with the Goods declaration for reasons deemed valid by the Customs, they shall allow production of those documents within a specified period.
Not covered
Not covered This practice is adopted/obtained from the SA customs law. Pre-release is such. This needs to be legislated.
Transitional Standard 3.18.
Customs shall permit the lodgement of supporting documents by electronic means.
Not covered
Not covered Add into the legislation. Challenge is automation of customs for implementation
Standard 3.19.
Customs shall not require a translation of the particulars of supporting documents except when necessary to permit processing of the Goods declaration.
Not covered
Not covered Legislation to be added
Transitional Standard 3.21.
Customs shall permit the lodging of the Goods declaration by electronic means.
Not covered
Not covered Provide legislation for electronic declaration.
Standard 3.22.
Goods declaration shall be lodged during the hours designated by the Customs.
Not covered
To be explicitly covered under Reg. 6.
Standard 3.23.
Time allowed to lodge declaration
Sec 7, 12 Time frame to be specified in sec 12 for road.
Standard 3.24.
Customs shall extend the time limit prescribed for lodging the Goods declaration.
Sec 7, 12 Legislation to be aligned accordingly.
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Standard 3.25.
Customs legislation shall make provision for the lodging and registering or checking of the Goods declaration and supporting documents prior to the arrival of the goods.
Not covered
Not covered The practice is in place for pre-arrival processing but needs to be legislated.
Standard 3.27.
Customs shall permit the declarant to amend the Goods declaration that has already been lodged
Not covered
Not covered Practice to be legislated
Transitional Standard 3.29.
Declarant shall be allowed to withdraw the Goods declaration and apply for another Customs procedure Customs.
Not covered
Not covered To be provided national legislation under sec 41
Standard 3.30.
Checking the Goods declaration at the same time or as soon as possible after the Goods declaration is registered.
Not covered
Not covered Add in the legislation sec 7 &12
Standard 3.31.
For the purpose of checking the Goods declaration, Customs shall take only such action as they deem essential to ensure compliance with Customs law.
Sec 41 Provide legislation specifying all necessary action for checking the goods declaration (in the regs)
Standard 3.32.
Customs Facilitation of Authorised Economic Operators
Not Covered
It is already included in the taxation amendment bill 2008. Lack of supporting risk management framework
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Standard 3.40.
Goods declared shall be released as soon as the Customs have examined them or decided not to examine them,
Sec 12, sec 14 (amended – check amended act) Sec 39 sec 40
Modify accordingly sec 12 and sec 14, 39 & 40
Standard 3.41.
Customs shall release goods if satisfied that the declarant will subsequently accomplish all the formalities in respect of clearance Customs
Not covered
Not covered
Modify and align accordingly (under sec 12, 14, 39 & 40)
Standard 3.42.
When the Customs decide that they require laboratory analysis of samples, detailed technical documents or expert advice, Customs shall release the goods before the results of such examination are known
Not covered
Not covered
To be added. National legislation does not support this standard. There are no laboratories for scientific analysis of goods. However there are partnerships with laboratories testing providers
Standard 3.43.
When an offence has been detected, the Customs shall not wait for the completion of administrative or legal action before they release the goods
Not covered
Not covered
To be added (The current practice needs to be aligned/legislated)
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Standard 3.44.
When goods have not yet been released for home use or when they have been placed under another Customs procedure the person concerned shall not be required to pay the duties and taxes
Sec 110 Reg schedule 4 (rebate Item 412)
Currently covered for rebate item 412. Scope should be increased to any goods.sec 110
Standard 4.2.
The time period within which the applicable duties and taxes are assessed shall be stipulated in national legislation.
Sec 39 & 46
Increase the scope by specifying time frame for payment in sec 39. Check VAT Act & C&E Act for alignment .
Standard 4.6.
National legislation shall specify the methods that may be used to pay the duties and taxes.
Sec 40 &105
To be added under sec 105 to include other means of payment or include means of payment under sec 40
Standard 4.8.
National legislation shall determine the due date and the place where payment is to be made.
Sec 6, 39 & 40
Reg 6 Modify Reg 6 or Sec 6 or 39 or 40 to include places where duties and taxes would be paid.
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Standard 4.9.
When national legislation specifies that the due date may be after the release of the goods, that date shall be at least ten days after the release. No interest shall be charged for the period between the date of release and the due date.
Not covered
Sec 66A taxation amendment bill 2008 draft
Standard 4.10.
Customs legislation shall specify the period within which the Customs may take legal action to collect duties and taxes not paid by the due date.
Not covered
To be added in the legislation
Standard 4.11.
Customs legislation shall determine the rate of interest chargeable on amounts of duties and taxes that have not been paid by the due date and the conditions of application of such interest.
Not covered
To be added in the legislation
Standard 4.12.
When the duties and taxes have been paid, a receipt constituting proof of payment shall be issued to the payer
Not covered
Covered in Financial regulation and LRA administration manual
Standard 4.14.
Recovery of duty underpayment caused by declarant errors
Not covered
The standard conflicts with the practice
We need to review the minimum amounts and align customs and tax legislation
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Standard 4.15.
Deferred payment of duty sec 105 Sec 105 should be aligned with the standard
Standard 4.16.
Deferred payment shall be allowed without interest charges to the extent possible.
Sec 105 The standard conflicts with the legislation
Sec 105 should be aligned with the standard
Standard 4.17.
Period for deferred payment of duties and taxes shall be at least fourteen days.
Sec 105 Sec 105 should be aligned with the standard
Standard 4.21.
Decisions on claims for repayment shall be reached, and notified in writing to the persons concerned
Sec 78 Sec 78 should be aligned with the standard to include other duties.
Standard 4.22.
Overpayment of duty and taxes due to Customs errors
Sec 77 Schedule 5
Sec 77 and Schedule 5 should be aligned with the standard
Standard 4.24.
Repayment shall not be granted if the amount involved is less than the minimum amount specified in national legislation.
Sec 77 Review the minimum amounts and harmonizing customs and tax legislation
Standard 5.1.
National legislation shall enumerate the cases in which security is required and shall specify the forms in which security is to be provided.
Sec 17, 20, 61, 65, 66, 100
Reg 17, 56, 68
Review and include other cases of the security e.g. (valuation)
Standard 5.3.
Any person required to provide security shall be allowed to choose any form of security provided that it is acceptable to the Customs.
Not covered
To be added
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Standard 5.4.
Customs shall not require security when they are satisfied that an obligation to the Customs will be fulfilled.
Not covered
To be added
Standard 5.5.
Customs shall accept a general security
Not covered
To be added
Standard 5.6.
Amount of security shall not exceed the amount potentially chargeable.
Not covered
To be added
Standard 5.7.
Security to be discharged soon after fulfilment of obligation
Not covered
To be added
Standard 6.2.
Customs control shall be limited to that necessary to ensure compliance with the Customs law.
Sec 6,7, 8, 9, 11, 12, and 14 as amended
Review customs controls and align with the standard
Standard 6.3.
In the application of Customs control, the Customs shall use risk management.
Not covered
To be covered.
Standard 6.4.
Customs shall use risk analysis to determine which persons and which goods, including means of transport, should be examined and the extent of the examination.
Not covered
To be added
Standard 6.5.
Customs shall adopt a compliance measurement strategy to support risk management.
Not covered
To be covered
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Standard 6.6.
Customs control systems shall include audit-based controls.
Not covered
To be covered
Standard 6.7.
The Customs shall seek to co-operate with other Customs administrations and seek to conclude mutual administrative assistance agreements to enhance Customs control.
Not covered
To be covered
Standard 6.8.
The Customs shall seek to co-operate with the trade and seek to conclude Memoranda of Understanding to enhance Customs control.
Not covered
To be covered
Transitional Standard 6.9.
Customs shall use information technology and electronic commerce to the greatest possible extent to enhance Customs control.
Not covered
To be covered
Standard 6.10.
Customs shall evaluate traders’ commercial systems where those systems have an impact on Customs operations to ensure compliance with Customs requirements.
Not covered
Included in the taxation amendment bill 2008. Provide general provisions to cover every client
Standard 7.1.
Customs shall apply information technology to support Customs operations
Not covered
To be added
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Standard 7.2.
When introducing computer applications, the Customs shall use relevant internationally accepted standards.
Not covered
To be added
Standard 7.3.
The introduction of information technology shall be carried out in consultation with all relevant parties directly affected, to the greatest extent possible.
Not covered
To be added
Standard 7.4.
Customs legislation shall provide for electronic as well as paper-based authentication methods;
Not covered
To be added
Standard 8.3. Customs transactions not to be
discriminatory Not covered
To be added
Standard 8.4. Rights of a person designated as a third party
Not covered
To be added
Standard 8.5. Third parties to participate in Customs formal consultations with the trade.
Not covered
To be added
Standard 8.7. Customs shall give written notification to the third party of a decision not to transact business.
Not covered
To be added
Standard 9.2. Customs shall make amendments available in advance
Not covered
To be added
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Transitional Standard 9.3.
Customs shall use information technology to enhance the provision of information.
Not covered
To be added
Standard 9.4. Customs shall provide information relating to the specific matters raised by the interested person and pertaining to Customs law.
Not covered
To be covered
Standard 9.5. Customs shall supply not only the information specifically requested but also any other pertinent information which they consider the interested person should be made aware of.
Not covered
To be added
Standard 9.7. When the Customs cannot supply information free of charge, any charge shall be limited to the approximate cost of the services rendered.
Not covered
To be added
Standard 9.8. At the written request of the person concerned, the Customs shall notify their decision in writing within a period specified in national legislation.
Sec 90 Provide general provisions to cover the standard
Standard 9.9. The Customs shall issue binding rulings at the request of the interested person, provided that the Customs have all the information they deem necessary.
Covered in the taxation amendment bill 2008 draft
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Standard 10.3.
A person directly affected by a decision or omission of the Customs shall be given the reasons for such decision or omission
Not covered
To be added
Standard 10.4.
National legislation shall provide for the right of an initial appeal to the Customs.
Sec 92 To be clarified and modified
Standard 10.5.
Where an appeal to the Customs is dismissed, the appellant shall have the right of a further appeal to an authority independent of the Customs administration.
Not covered
Link to the revenue tribunal from the C&E Act.
Standard 10.6.
In the final instance, the appellant shall have the right of appeal to a judicial authority.
Not covered
A link of the act to the judicial appeal
Standard 10.8.
A time limit shall be fixed for the lodgment of an appeal against a decision of the Customs
Not covered
Not covered
Link C&E Act to the Revenue tribunal act
Standard 10.9.
Where an appeal is to the Customs they shall not require that any supporting evidence be lodged
Not covered
To be added
Standard 10.10.
Customs shall give its ruling upon an appeal and written notice thereof to the appellant as soon as possible.
Not covered
To be added
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Standard 10.11.
Where an appeal to the Customs is dismissed, the Customs shall set out the reasons thereof in writing
Not covered
To be added
Standard 10.12.
Where an appeal is allowed, the Customs shall put their decision or the ruling of the independent or judicial authority into effect as soon as possible
Not covered
To be added
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