ICCAFA MEETS MRA ON CUSTOMS AND EXCISE ACT APPLICATION

In a bid to clear the confusion on the application of customs and excise act on Customs Agent/Broker Authorisation Form (CABAF), the Indigenous Customs Clearing and Forwarding Agents (ICCAFA) held a meeting with MRA at Msonkho House, MRA Head Office on 20th October, 2022.

During this meeting, the emerging issue was that members of the Indigenous Customs Clearing and Forwarding Agents (ICCAFA) an umbrella body of the indigenous Customs Clearing Agents in the country sought an interpretation on the application of the Customs Agent / Broker Authorization Form (CABAF). The ICCAFA members felt that the CABAF was being wrongly applied or deliberately violated by members and stakeholders in the clearing, shipping and forwarding industry for selfish gains.

In his words, the ICCAFA president cited section 127 of the Customs and Excise Act as the law that gives mandate to the importer or exporter to appoint an agent in writing.

“Under section 127 of the Customs and Excise Act, the law clearly stipulates under subsection 4 that, an officer may require from any person purporting to be an authorized agent the production of written authority of his principal and in default of the production of such authority such officer may refuse to recognize the person as an authorized agent.” Said the president.

The ICCAFA president further stressed that the introduction of the Customs Agents Broker Authorization Form (CABAF) by the Commissioner General is the manifestation of the understanding and application of the above provision.

It was also stated that it is ICCAFA belief that the obligations of the buyer in international trade includes import customs formalities, whether it be payment of duties and taxes for consumption at border or/and arrangement to complete customs formalities in land or at a later stage, like the current system in Malawi. It was stressed by the ICCAFA president that goods can NOT be deemed to be in transit in the country of final destination. Loosely using the term “transit” on such transactions has resulted in derailment of processes. The correct wording reads, “removal into bond.”

Further to this, ICCAFA is of the view that the framers of the Customs and Excise Act intended that MRA as custodians of the customs law, must make sure that the provisions of the Act are respected and applied by all stakeholders in the industry including the MRA officials.

Thus provision 127 of the ACT gives mandate to the principal to appoint in writing an Agent of their choice to formalize all import or export formalities on their behalf in respect to the law under subsection 4 of the Customs and Excise Act. ICCAFA representatives also pointed about how the violation of this Act can be associated with smuggling. That is, from the interpretation of the Customs Laws, the term “smuggling” means “the importation or exportation, or the loading onto or unloading from any conveyance, or the diversion for consumption, of any goods subject to customs control with intent either to defraud the Government of any duty payable thereon or to evade any of the provisions of the customs laws”.

During this meeting, ICCAFA representatives vehemently opposed against those entities that operate on behalf of principals without a written authority as the law demands and reminded MRA that being a custodian of the law, allowing and accepting such operations is violating their own law as provided for under subsection 4 of section 127 of the Customs and Excise Act.

Reacting to this news, shipping line agents representative from MSC alluded to the fact that they instruct their customs agents to declare the goods and process the customs processes at the border because of contract of carriage which obligates them to drop the goods at a named place. They believe that the goods are still in transit until they reach the place where the contract of carriage ends.

The representative also alluded to the fact that their appointed agents access and use the importers TPIN without consent because of the same contract of carriage. It was also pointed out in the same meeting that this arrangement was done with MRA officers from the border offices. Shipping line agent representative from CMACGM narrated that they have a list of their preferred Clearing Agents who they ask the importers to choose from when the goods land at the border to facilitate the removal into bond formalities.

The shipping Agent from MAERSK narrated that they leave import formalities to be done by the importer although he was quick to mention that as a business entity they are arranging to a have an end to end contract where the importers will be asked to sign contract to that effect.

Taking his turn, MRA legal team representative pointed out that matters of contract are very complex and require due care. He was quick to advise on issues of unfair trading, and illegality of using another entity’s TPIN without authority. He also pointed out on issues of confidentiality when it comes to appointment of an agent. He commented that the principal in the case at hand is the importer whose obligation may be transferable to an agent of his choice from a named jurisdiction be it at border or inland.

This meeting which was chaired by MRA was attended by MRA Management, ICCAFA Members, CMA CGM Shipping line, MAERSK Shipping Line, MSC Shipping line, CAFAM, and Consultative Observer from CILT Malawi Chapter