EA Traders Start Benefiting from EA Single Customs Territory

The implementation of the Single Customs Territory within the East African Community (EAC) member states that began with a focus on the Port of Mombasa, where most goods entering EAC through the port are immediately cleared, has been shifted to benefit goods that are locally-produced within the EAC member countries.

With this initiative, Ugandan goods such as cement and Mukwano products are the first to benefit from this newly-introduced system.

Starting in April 1, cement imported from Uganda to Rwanda, basically from Hima and Tororo, is cleared right from the factory with the aim of easing clearing process and save the importers’ time by reducing the declarations to only one.

Previously, importers were required to make export declaration and secure a bond to cover transit goods. In addition, when goods reached at Rwandan borders, they would again lodge another declaration. This was a tiresome process, time consuming and involved high costs, especially in securing bonds.

The new system has made life easier for importers since they are no longer required to pay bond charges meant to secure goods while in transit as has been the requirement for transiting consignments from factory to the final destination.

The new facility now, requires cement importers to only give invoices, certificate of origin, parking list and other trade related documents to the clearing agent, who uses them to make one declaration while in Rwanda. After making the declaration and payment, the Ugandan customs officers based at the factory analyse it and immediately release the declared goods.

When goods reach Rwandan border posts, customs officers remove the seal on the container or truck and they continue to wherever they are taking the cement or any other products for sale.

To ensure that taxpayers fully understand and enjoy the attached benefits, the Rwanda Revenue Authority has engaged various partners such as clearing agents and the private sector federation in mobilisation and sensitisationprogrammes.

Clearance of EAC locally-made products has also been launched in other remaining EAC countries and member states are in discussions to ensure it does not meet any hindrances.

 

The Single Customs Territory is instrumental in any given customs union for it lays a strong foundation for both the Common Market and Monetary Union.

Some of the benefits for the single customs territory include reducing cost of doing business by elimination of NTBs duplication of processes; reduction of costs associated with regulatory requirements; enhanced synergies through shared resources , provides a springboard for the free movement of other factors of production under the common market,

Others are increasing intra-EAC trade, increased turnaround of business, combating of smuggling, increased cross-border investment and enhanced application of information technology and data collection at regional level.

Among the issues under discussion in the taskforce sessions in EAC in Arusha under the new arrangement include the revenue management, free circulation of goods, legal and institutional framework.

Under the revenue management pillar issues under discussions include, collection of duties and taxes, currency, revenue remittances, bond management, assessment, examination and release of goods, payment of domestic taxes for transfer of local goods

Under the free circulation of goods pillar, issues include clearance of goods entered for home consumption, warehousing, transit, temporary importation ,transfer of duty paid goods, goods in Special Economic Zones and Export Processing Zones, transfer of locally produced goods, among others.

Legal and Institutional Framework pillar includes , issues of standards, customs offences, clearing agencies, dispute settlement, harmonisation of domestic laws and other border agencies.

 

The writer is the head of media and customer relations at Rwanda Revenue Authority

The EAC business community has been asked to take advantage of the Authorized Economic Operator (AEO) scheme that seeks to cut down costs of doing .

 

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