South African Customs Control Bill Parliamentary Representation to Scof by Global Maritime Legal Solutions (Pty) Ltd

Transcription

1 South African Customs Control Bill Parliamentary Representation to Scof by Global Maritime Legal Solutions (Pty) Ltd Presented by: Mark Goodger, Managing Director of GMLS 28 January 2014

2 Extract from a wise African Proverb If you want to go quickly, go alone If you want to go far, GO TOGETHER 2

3 The Question? YES NO 3

4 GMLS RESEARCH REPORT ADDRESSED THE FOLLOWING 4

5 What are the Concerns? Trade Facilitation? WCO Revised Kyoto Convention & WCO SAFE Framework SARS Consultation GMLS Research - UCT ICC Incoterms 2010 Ports versus Terminals 5

6 SARS LEGAL DEPARTMENT REPLY to GMLS Study From Professor Eiselen s - UNISA Opinion He disagrees with the JCCI s views that this policy change will have the effect that traders will change the terms of their contracts of sale He also disagrees that the policy change will result in a change in contract of carriage He disagrees as to GMLS interpretation of ICC Incoterms 2010 Rules He disagrees that carriers will, as a result of the policy change, no longer issue a through bill of lading that will allow the goods to move from Durban to e.g. City Deep He furthermore strongly criticises the GMLS report that BUSA commissioned as it bases its conclusions on generalities and misleading statements 6

7 THE WCO REVISED KYOTO CONVENTION A KEY PROGRAMME FOR THE WCO!! 7

8 Important Extract ³ NOW THEREFORE the Government of the Republic of South Africa, having considered the Protocol, hereby accedes to the Protocol of Amendment to the International Convention [on the Simplification and Harmonization of Customs Procedures] and undertakes faithfully to observe all its provisions and to carry out the stipulations therein contained and also declares the acceptance of the General Annex appended to the said Protocol.² RSA acceded to the Protocol of Amendment and the General Annex, therefore we did not accede to the specific annexes and are not bound to them.

9 Revised Kyoto Convention - SACU Botswana Namibia Lesotho Borders Zimbabwe 11 out of 22 in WCO Region 9

10 RKC Ratification/Amendments Established on 18/5/ /6/1999 Amended 18/5/ South Africa 3/2/2006 Entered into force 78 contracting parties WCO SAFE Framework Letter of acceptance Pravin Gordhan was the WCO Chairperson. 10

11 RKC PREAMBLE Endeavouring to eliminate divergence of Customs Procedures that hamper International Trade and International Exchanges Simplify and Harmonise Customs Procedures Facilitation without compromising Customs control standards Modernisation Efficiency, Predictability Principles General Annex Specific Annex NB!! It sits with and is registered with the Secretariat of the United Nations 11

12 Manifest According to SARS, the Manifest does not contain information to determine Risk USA & EU? - Legislation Risk Information in a Manifest is based on hearsay? Not True Goods do not move across the country they move in secure pipelines. If you only assess risk when the goods arrive, you have failed Chapters 3 and 6 of General Annex and Specific Annex A of the Revised Kyoto Convention 12

13 Customs-to-Customs Cooperation PILLAR 1 Authorised Supply Chains 13

14 International Agreements in New Bills international agreement means (a) an international trade agreement; or (b) a convention, treaty or other international agreement irrespective of its designation, including (i) any protocol to such agreement; (ii) any annex or appendix or other addition to the agreement or any such protocol; (iii) any regulation or other measure issued under the agreement or any such protocol; (iv) any amendment to the agreement or any such protocol, to any such annex, appendix or other addition, or to any such regulation or other measure; and (v) any other instrument that forms part of the agreement or any such protocol;

15 RISK MANAGEMENT Chapter 6 WCO SAFE Framework of Standards Not just about having good processes; it is a way of thinking towards pro-active rather than reactive management of the Border Martyn Dunne Chairperson WCO 15

16 SOUTH AFRICA HAS THE RIGHT TO A SECURE TRADE PIPELINE Transnet? 16

17 NEW WORLD SECURITY Following the 9/11 terrorist attacks. The WCO recognised that such a major attack on the Trade Supply Chain would have impacts felt beyond the boundaries of the disaster itself and trade would suffer dramatically for a long time after. Customs controls which only covers the point of Importation is now no longer enough ~ thus the need for the WCO SAFE FRAMEWORK OF STANDARDS.

18 The WCO SAFE Framework of Standards Customs Administrations globally were charged with Supply Chain Security Responsibilities after the Terrorist attacks in 9/11

19 2 Important Paragraphs from SAFE Cargo declaration The carrier or his/her agent should submit an advance electronic cargo declaration to the Customs at export and/or at import. For maritime containerized shipments, the advance electronic cargo declaration should be lodged prior to the goods/container being loaded onto the vessel. For all other modes and shipments, it should be lodged prior to arrival of the means of transport at the Customs office at export and/or import. For security purposes, Customs should not require more than the details listed in Annex II. The advance cargo declaration may have to be followed by a supplementary cargo declaration as stipulated by national law. 19

20 SARS Presentation Slide 39 Inland Terminals Article of the SAFE framework of standards dealing with Import Goods declaration supports advance clearance: The importer or his/her agent should submit an advance electronic import Goods declaration to the Customs at import prior to arrival of the means of transport at the first Customs office or, for maritime container shipments, prior to loading. For security purposes, Customs should not require more than the details listed in the Annex. Where the import Goods declaration was an incomplete or simplified declaration, it may have to be followed up by a supplementary declaration for other purposes such as duty calculation or the collection of trade statistics at a later stage as stipulated by national law. The Authorized Supply Chain (see 1.4.2) provides the possibility to integrate the export and import information flows into one single declaration for export and import purposes, which is being shared between the Customs administrations concerned. The SAFE framework of standards requires that a customs clearance is submitted 3 days in advance of arrival at port of entry in order to facilitate port planning and congestion. SARS supports this proposal since 70% of importers currently make advance customs clearance. Carriers also support this position. SARS proposes amendments to the CCB to provide for mandatory advance customs clearance and conditional release for goods consigned to inland terminals 20

21 GMLS CREDIBILITY GMLS was appointed by Trade Chambers to conduct the Research Study through the University of Cape Town. Accredited WCO SAFE Framework of Standards studies GMLS is appointed Customs Subject Matter Experts for Lectures at various South African Universities on Customs & Excise at PGDip and Masters Degree level (UKZN, UCT, NWU) Associated Member of the International Network of Customs Universities (INCU) Currently the only International Chamber of Commerce (ICC) Master Trainer in South Africa Accredited TETA Center of Excellence SCM FIATA Higher Diploma Supply Chain WCO Accredited Tutor

22 GMLS CREDIBILITY

23 GMLS CREDIBILITY

24 GMLS Master Trainer ICC Products ICC AGREEMENTS, TOOLS, ARBITRATION & INSTRUMENTS 24

25 Incoterms 2010 Rules and Guide DAT & DAP (New and introduced by Professor Jan Ramberg GMLS 2010) supports increase of Inland Trade destinations Changes and use mainly CIF? Incorrect SARS assumption? Carrier documentation and no accountability under South African law? Clearance is currently not a two-step process CIF versus DDP no consultation Clearance will take place in Durban!!! Once The main objection is the uncertainty of interruption or termination of the contract of carriage - The Guide to Incoterms 2010 clearly states that precautions need to be taken against the risk of export and import prohibitions; - Obtaining all assistance to clear Customs - Adhere to global security measures and the changing role of Customs-

26 DAT (DELIVERED AT TERMINAL) Delivery This is for ANY MODE OF TRANSPORT Goods are delivered when the Seller unloads the goods and places them at the Buyer s disposal at the NAMED TERMINAL The Seller pays for the Transport The Seller is responsible for Export clearance where applicable The Buyer is responsible for Import clearance where applicable

27 ICC Guide to Incoterms 2010 Professor Jan Ramberg insert Take precaution against the risk of Export and Import prohibitions Obtaining assistance to clear Customs Security measures and the Changing Role of Customs Rules A2 B2, A10 B10 Resolution of the Customs Cooperation Council It follows from what has been stated that the meaning of Duty Paid and Clearance of goods for import and export has changed. The traditional check-point at the Border of the country of importation has developed into a global system of advanced control which = Revised Kyoto Convention Special Annex A

28 SELLER & BUYER OBLIGATIONS A1 General obligations of Seller B1 General obligations of Buyer A2 Licenses, authorisations security clearances and other formalities B2 Licenses, authorisations security clearances and other formalities A3 Contracts of carriage and insurance B3 Contracts of carriage and insurance A4 Delivery B4 Taking delivery A5 Transfer of Risk B5 Transfer of Risk A6 Allocation of costs B6 Allocation of costs A7 Notices to the Buyer B7 Notices to the Seller A8 Delivery document B8 Proof of delivery A9 Checking-packaging-marking B9 Checking-packaging-marking A10 Assistance with information and related costs B10 Assistance with information and related costs

29 Points raised with SARS by Business? The Other Carriers?? Groupage operators and Container Freight stations in South Africa A specific niche industry providing the freight forwarders, customs brokers, importers and exporters with LCL (less than container load) services Services Transporting LCL shipments between South Africa and the world (inbound and outbound) Packing and unpacking consolidation containers (a multitude of shippers, importers cargo in one container) Transhipment of LCL cargo (cargo ex neighbouring countries for exports, cargo from overseas for t/s or road transport to other African countries) Bonded transport between customs licenced CFS Container operators and customs licenced depots

30 Concerns resulting from New Bill Groupage containers manifested to inland ports (mainly Johannesburg) will randomly stop at the coast due to single shipments in the container missing the required declarations The above will create uncertainty and inconsistency for ALL shipments as to transport mode and transit time to the inland terminal As a conclusion importers will decide to terminate all shipments at the coast resulting in congestion and higher transport cost Job losses in Gauteng as groupage operators will not operate import or export departments in Gauteng anymore Job losses at the inland CFS as all work will be handled at coast Import and export movements of LCL will completely move to road and instead of consolidated movements the number of vehicles for smaller loads will drastically increase Risk The risk of fraud, pilferage, hijacking of LCL shipments in groupage containers is close to zero as high value cargo moves in FCL or by airfreight. Physical Location of shipments in a groupage container are unknown.

31 Contract of Carriage Clause 5.3 Delivery to Customs or Port Authorities Where any law or regulation applicable at the port of Discharge or Place of Delivery provides that delivery of the Goods to the Merchant shall or may be effected by the Customs or Port authorities at the Port of Discharge or Place of Delivery, notwithstanding anything to the contrary herein, delivery of the Goods by the Carrier to such Customs or Port authorities shall be deemed to be lawful delivery of the Goods by the Carrier to the Merchant and the Carrier shall not be liable for any loss of or damage to the Goods which occurs for any reason whatsoever after delivery of the Goods by the Carrier to the Customs or Port authorities.

32 A Wise African Proverb If you beat the Drum Don t use an Axe

33 The Solution? Declare Sooner In accordance to RKC Specific Annex A Declare at or before Point of Departure (3 (7) of SAFE) ISPS Code (b ) ~ action before container loaded on board the vessel Sealing ISO & UCR WCO Guidelines Seal verification at discharge points Security Seals and UCR Proper AEO Programme Focus on SARS capacity building Joint Governmental and Private Sector Consultation (Customs-to- Business Pillar 2) Retain Section 18 current Statutory Rights Phase-in slowly

34 The Focus for South Africa Full Compliance with Global International Instruments 34

35 WORRIED OR NOT? Maputo Corridor Trans-Kalahari Corridor Lesotho 35

36 CRITICAL CROSS-BORDER FLOW POINT Export Goods Declaration Advance Loading Manifest Cargo Declaration Port - Durban Import Goods Declaration Import Goods Declaration Radio Frequency GPS, UCR & Seal Program 3 Days 3 Days Inland Port/Termin al Export Country Border Import Country Border Seal Container Status Messages

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38 Introduction from a wise African Proverb In the moment of crisis, the wise build bridges and the foolish build dams 38

39 For further information on this and other Training Courses offered by GMLS, please contact us on:- Website: Office Mobile: Tel: or Fax: or