Keeping up with customs modernisation
9 Jan 2018 - by Devlyn Naidoo
Customs administrations have since time immemorial been given the prestigious and often laborious task of protecting a country’s borders and promoting the movement of internationally traded goods. Through the ebb and flow of the many administrative challenges that were faced at customs border posts, consumer goods would eventually find themselves in retail or raw materials in manufacturing.
Everything around us is “Customs and Excise”. From the laptop I type this article on to the clothes you wear, all internationally traded goods have to pass through customs unless of course illegally smuggled into the country, but that’s a topic for another read. All these internationally traded goods would have been declared twice in the international trade cycle, once at the time of export and again at the time of import.
As per The Customs & Excise Act 91 of 1964 no goods can leave or enter the republic without first having been declared to Sars in the prescribed manner unless otherwise stated or provided for by the commissioner. The Customs & Excise Act 91 of 1964 was beautifully drafted around the WCO legislative guidelines and prescriptions thereto and has served the republic well over the decades, however change is inevitable and a few of the prescriptions contained therein would soon become ineffective as technological advancements gave rise to a smarter, more evolved mechanism of international trade.
The Customs Modernisation Programme was officially launched in 2009 in order to address a number of critical issues. Trade volumes had doubled over the previous 10 years, while staff numbers had, in fact, decreased. Systems and processes in Customs were still largely paper based and labour-intensive, leading to large numbers of validation errors, wasting staff resources on low value-adding activities. Lack of adequate Customs presence at ports of entry, lengthy inspection turnaround times and poor trader awareness and management were also identified as other areas of concern.
Customs Modernisation was introduced to address these and other issues by focusing on four key areas: our systems, policies, processes and people.
In 2010, several “building block” projects were implemented under the Customs Modernisation Programme (CMP). This included Release 1 which saw the migration from the use of purpose codes on declarations to procedure category and procedure codes.
In 2011 and 2012, the modernisation of Customs picked up pace with every area of Customs and trade impacted by several key changes, called Release 2 and 3. The main change under Release 2 was the introduction of an automated workflow-driven system, called Service Manager, which allowed customs officers to complete all clearance processes end-to-end without having to perform manual functions. Release 3 focused specifically on the Botswana, Lesotho, Namibia and Swaziland (BLNS) land border posts.
Sars then went on to draft the relatively new Customs Control Act 31 of 2014 referred to as “The Act” - and as with all new legislation, they (Sars) opened the window for public and private stakeholder feedback prior to submitting to government the traditional sign, seal and deliver. Proverbially speaking, many of the big boys were “throwing their toys out of the cot” over the shortened time frames for customs clearance procedures to be expedited which meant rearranging operational procedures and redefining internal processes of course.
The benefits of keeping up with worldwide customs advancements are innumerable, even for the “big boys”. The Act has taken into account the advent of customs modernisation that brings with it automated cargo manifests, EDI interfaces with shipping lines, security risk-based management protocols, as well as preferred trader policies - just a few of the exhaustive number of implementations around customs modernisation. This means reduced paperwork, quicker turnaround times and improved efficiencies are the order of the day. Customs Modernisation initiatives have put the “F” back into FMCG by improving customs formalities at border posts (sea, road, rail and air)
Say goodbye to tedious and monotonous processes of the past. We have come a long way from the days of rubber stamps, triplicate carbon DA550 forms, manually filling in of Customs bill of entry forms, being ever so careful whilst doing this so as to avoid blotching. Goodbye to the old, hello to the new! Customs modernisation is here and it’s here to stay!
We need to be proactive in our consistent and constant engagement with Sars in identifying problem areas so as to iron out issues timeously and not wait for a shipment to be delayed due to administrative challenges - for example issues with scanner stops.
It is imperative that we keep up with the implementation of the latest technological, procedural and systematic enhancements of global Customs administrations’ modernisation initiatives. After all international trade is invariably the heartbeat of any Customs administration be it Sars or the ZRA. If products are not timeously and efficiently cleared through our borders due to outdated customs administration practices, it will invariably deter both local importers and international suppliers from conducting international trade in our country. And not only does this affect our GDP but this quagmire also has a knock-on effect on us as the end consumer. Imagine if we were one of the last countries to be enjoying Kim K’s latest fragrance on our retail shelves - we are now in 2018, can we really ‘Keep up with the Kardashians’?
NOTE ABOUT THE AUTHOR: Devlyn Naidoo is currently a facilitator and customs mentor at the SA Maritime School and Transport College (SAMS), a privately owned college that provides training and skills development in international trade, freight handling and customs compliance.