Comment Sheet
on the DRAFT RULES
in terms of the proposed Customs Control Act1
(Chapters 11-20 and 24)
*Please provide comments in the format provided no later than 26 September 2014 to:
Email
sauthar@sars.gov.za (Samantha Authar)
Number of pages of comments (including this page)
Date
26 September 2014
Comments from
SAAFF representatives in the industry
Designation
SAAFF
Company / Institution / Department
SAAFF, SAASOA
Email address
dlogan@saaff.org.za
Facsimile No.
011 455 1709
Office telephone No.
011 455 1726
Cellular telephone No.
082 927 2040
Physical Address
SAFCEC House, 1st Floor, 12 Skeen Boulevard, Bedfordview
Received By:
Date
2
FEEDBACK ON THE DRAFT CUSTOMS CONTROL RULES
Page No.
Rule No.
2
11.1(1)
3
11.1(1)(b)
4
11.5
3
3
Comment
Recommendation
Customs seaports are too limited. This may have an
adverse impact on the economy and in particular on those
seaports that are excluded
Reference to section 241(2)(b) is not correct
To be expanded as per Rule 9.2(2)
11.1(1)(b)
Specific reference is made to movement between Port
Elizabeth and Port of Ngqura only.
11.1(2)
Customs airports are too limited. This may have an
adverse impact on the economy and in particular on those
airports that are excluded
A transhipment clearance declaration or other document
must be submitted- on board a vessel at least one calendar
day before the vessel arrives –
At least 2 hours before the aircraft arrives -
Clarity is requested whether this deems Port
Elizabeth and Port of Ngqura to be a single seaport,
and further clarity is requested whether movement
between terminals of the same seaport would also be
subject to this rule.
To be expanded as per Rule 9.2(2)
11.2 (a)
11.2 (b)
3
11.3
Query the requirement for transhipment cargo to be
declared in terms section 249(1) and section 167
5
11.8 (1)
a. Reference is made to the period within which a
transhipment operation must commence is 24 hours from
release of the good for transhipment.
Correct reference to 242(1)(b)
Why should the clearance declaration be submitted,
one calendar day in respect of a vessel and two
hours in respect of an aircraft, prior to arrival?
Recommend that the same timeframe i.e. 3 working
days after arrival as per section 90 (1) (a) and (b)
should apply.
Practical consideration should be given to the
information that is available to the cargo reporter in
consultation with the industry.
Clarity on the definition is required?
Is our interpretation correct?
The transhipment clearance declaration to be
submitted to customs 24 hours (11.2 (a)) prior
vessels arrival/berth;
The carrier to receive the customs release for
transhipment within the 24 hours (11.8. (1)) of the
goods/container being discharged;
3
5
5
11.8 (1)
11.8 (2)
5
11.8 (2)
5&6
11.8 & 11.10
b. Commencement of transhipment operation. If this
release is on a public holiday or a series of public holidays,
it would not be practical.
a. Reference is made to the period within which a
transhipment operation must be completed is 7 days from
the commencement of the transhipment operation.
Should be extended to 3 working days from release
b. 7 days to complete the transhipment operation from its
commencement. This is completely impractical. In certain
cases there can be delays for several weeks before the
transhipping vessel arrives
Commencement/Completion of transhipment and
Compliance
Should be extended to 30 calendar days.
of the goods.
Clarity on the definition is required?
Is our interpretation correct?
Must the goods/container be loaded on board within
7 days (11.8 (2)) from the commencement period.
The request is for this transhipment operating period
to be extended to 30 days. There are a number of
reasons for this.
1) South African Ports are promoted as
transhipment hub ports.
2) To put a prescriptive administrative process
for cargo that is in fact controlled in a Customs
Controlled Area is not warranted.
3) We would therefore like to make two
suggestions to help cope with the control of
transhipments
a) Consider the use of the transhipment
Manifest as the administrative requirement
for transhipment cargo where an export
vessel can be identified beyond the 10
days.
b) Extend the required time period to 30 days
any exceptions and changes would then
have to be recorded on an outgoing
manifest. as soon as export operation
moved outside the 30 x days, the Shipping
line would inform Customs of the intended
vessel and ETS
4
…to the Customs Office that has serves the customs
seaport…”
Proof of export of goods under transshipment
“…to the Customs Office that serves the customs
seaport…”
Should be extended to 7 working days
Transhipment cargo often moves through the Republic on
a Through Bill of Lading, and as such there is no new
export bill of lading issued.
SARS indicated to SCOF that the intention is to make the
temporary admission customs declaration the application
for temporary admission under e.g. items 470.00, 480.00,
and 490.00, rather than to continue to require manual
application before a customs declaration may be submitted
to customs.
SARS indicated to SCOF that a Rule would be inserted in
the Duty Act making the customs declaration the
application for temporary admission.
Reference is made to “a document” without clarification on
whether this is a hard copy or electronic
Applications for replacement of CPD or ATA carnets about
to expire
An export manifest should be an acceptable
document as proof of export.
7
11.11 (1) (b)
7
11.12
8
11.13 (a)
9 to 23
Omission:
SARS response
to SCOF, page
8, par. 2.7
(temporary
admission)
11
12.3 (4) (b)
13
12.6 (2) (a) (b)
20
12.13 (a) (ii)
Packing material must be re-exported by the same carrier
12.13 (b)
Containers in JHB are moved to DBN under cabotage and
are therefore used. This could be considered as the one
use in the Republic permitted, but the container still
requires to be used for export.
Containers should be allowed for more than one
internal move.
12.15 & (1)(b)
The requirement that records may only be kept on the
registered business premises is impractical and quite
impossible in many cases due to restricted business space.
Provision should be made for electronic storage /
retrieval and / or off-site storage using third parties
(who might be required to license with SARS for this
purpose.)
21
As the Duty Act does not deal with temporary
admission, but Chapter 12 in the Customs Control Act
makes specific provision for “temporary admission”, it
is recommended that a Customs Rule to this effect
should rather be inserted in the Customs Rules to
Chapter 12 to the Control Act, where it makes the
most sense to do so.
Clarification is required whether the document may
be submitted electronically.
The Customs code of both the guaranteeing
association and issuing association is needed when
applying for extension. Does this imply that the
guaranteeing associations will have to register with
SARS?
This is impractical and should be removed.
5
25
13.1 through
13.20
General observation in respect of goods that automatically
come under the temporary admission procedure: Section
290 of the CCA
It is not clear what the period for temporary admission is for
reusable transport equipment
Section 266 Part 2 of the CCA: Importers of certain
commodities e.g. gas, may import those commodities in
returnable (reusable) equipment being gas cylinders. The
cylinders remain the property of the foreign exporter and
will be returned to that foreign exporter.
General Observations which must please be read with
the detailed commentary below and the discursive
commentary in Attachment A
It would appear that certain requirements relating to the
reporting of the delivery to and receipting of goods cleared
under the Warehousing procedure may have overlooked
the quantum of goods cleared under this procedure. For
example the motor industry would typically turn their stock
on a 30 day basis which could include as many as 10 000
line items. The requirement to notify SARS of the delivery
under Rule 13.4 (2) (e) would be an onerous task as that
entity would not be in a position to state the descriptions
and quantities of a declaration comprising of hundreds if
not thousands of lines. As far as the receipt notification is
concerned the requirement to reflect the tariff classification
of goods received at that warehouse Rule 13.5 (3) is not
attainable, such clearances may comprise of hundreds if
not thousands of lines. The requirement to receipt goods in
free circulation, is equally problematic. What would be
acceptable to SARS as documentary evidence that the
goods are in free circulation. Why would SARS want to
control goods that are in free circulation? This is onerous
and places an unnecessary administrative burden on both
the storage warehouse operator and SARS. Redirection of
goods cleared under the Warehousing Procedure Rule
13.2.
What is the period for temporary admission for
reusable transport equipment.
Is the assumption correct that the importer must
submit a regular clearance for the gas cylinders under
Part 2 of section 266. Will the importer be compelled
to maintain records of the internal movement of the
cylinders?
6
It is not at all unusual for licensees under the storage
warehouse procedure to receive in excess of 60 - 90
containers per shipment. An example would be automotive
parts where 60 to 90 containers are landed in a single
shipment. These facilities cannot physically receipt and
unpack 60 – 90 containers in a single delivery and
consequently those containers will be redirected to a transit
area, which may be a container yard, the transporter’s
depot or other premises. The redirection has been in place
for some time and always under current authorisation of
SARS Customs. In terms of section 304 (1) no person may
redirect goods without the permission of the customs
authority. Rule 13.2 requires that an application must be
made in terms of Rule 4.17 to redirect the goods to another
place. It is not clear if that other place must be a licensed
storage warehouse or could it be any place as mentioned
above? Rule 4.14 however requires that an amended
declaration must be processed, presumably to reflect that
other place? If so, would it be a requirement that that other
place must be SARS registered, licensed premises? Both
the carrier and storage warehouse licensee must lodge
surety to cover any tax that may be payable. It follows that
sufficient surety is in place to mitigate any risks. The goods
are not redirected for permanent storage at that other
premises, it is redirected for temporary storage while enroute to the licensed premises. In the circumstances it
would be counter-productive to require permission in terms
of the conditions attached to Rule 4.17. It is recommended
that the other premises could be considered an extension
of the licensed home use premises, bearing in mind that
any import tax is covered by surety. Rule 4.17 should be
reviewed accordingly to accommodate other premises
under this procedure. The temporary storage of the goods
whilst en-route should not be subject to reporting as in Rule
13.4 and 13.6.
7
25
13.1 (a) (b) (c)
26
13.2
A public warehouse may not use own transport for a
bonded warehouse
Staged delivery to a bonded warehouse:
26
13.3
Rule 29.36
The licensee of a public warehouse should be
allowed to use own transport
suggest a transhipment/staging yard/warehouse,
similar to current transit sheds
What is this rule?
26, 27, 29
13.4, 13.5, 13.6
3 hours response, however no time limit on paper
Provide for 24 hours
27
13.4 (2)
The information required on the delivery note, could lead to
misuse or abuse
It is felt that providing all the information listed, could be a
safety risk
27
13.5 (1) (b)
27
13.5(1) & (2)
Receipt notifications by licensees of storage warehouses
when goods are delivered for storage in storage
warehouses
Receipt notification by licensees of storage warehouses
when goods are delivered for storage in storage
warehouses.
The detail required in Rule 13.4(2) d, e and f should
not be required or included in the delivery note
information.
Also noted that a Bill of Entry or Clearing Instruction
could be used instead
For goods in free circulation, the reporting
requirements should not apply
28
13.5 (3)
receipt notification referred to in subrule (1) must reflect the
following information:
28
13.5 (3)
Receipt notification by licensees of storage warehouses
when goods are delivered for storage in storage
warehouses.
28
13.5(3)(a)(iii)
Customs Code of warehouse
29
13.6 (2) (b)
Customs code number
The licensee of a OS must notify Customs that the
goods were cleared and released for warehousing in
that warehouse and goods in free circulation to be
warehoused in that warehouse. A notification must
be submitted to Customs within 3 hours through efiling. E-filing is not a reporting tool, how will this
work? Is 3 hours sufficient?
the list is extensive and all information will be
supplied on Bill of Entry, why is it necessary to
declare this again?
The notification must reflect the following information
if the goods are non-containerised – the tariff
classification – this information is already on the bill of
entry. Most of the information requested has been
cleared on the BOE, why do we have to submit it
again and within 3 hours, can this time frame be
lengthened?
To be defined or specified to avoid confusion e.g
Storage Warehouse Number, Remover Code and
Importer Code
Storage Warehouse number should be the reference
used
8
30
13.7(2)
The motor industry is obliged to hold parts for up to 10
Years
30
13.7(2)(c)
Equipment and spare parts for oil drilling
The motor industry should be allowed a maximum
period of 5 years and this to be provided for in
additional rule 13.7 (2)(d)
How will this be defined or identified?
30
13.8 (2)
31
13.9 (2)
The maximum warehousing period for restricted goods
contemplated in section 305(4) of the Control Act is –
Physically identify goods
Time frame to be extended to 180 days in line with
other regulatory authorities like the NRCS.
Not possible for bulk
32
13.11 (d) (ii)
Reference made to rule 41
Currently no rule 41
33
13.11 (d) (x)
‘restricted goods’ requires clarity
Restricted goods to be stipulated
33
13.11 (d) (xi)
Goods lost
Include a provision for a loss allowance 1.5%
32 & 33
13.11
Inventory control & recordkeeping of goods under
The list of required information which must be
reflected for inventory purposes are majority of the
information captured on the BOE, why do we need to
show all that information again? Why does customs
need the contract of purchase and sale concluded
i.r.o. goods whilst in the WH, as well as any purchase
order issued by a prospective buyer? No Rule 41?
warehouse procedure
33
13.12
33 & 34
13.12(1) &(2)
Inventory Control and record keeping for free circulation
goods
Inventory control and recordkeeping of free circulation
goods in storage warehouses
35
13.14 (1)
We currently repack in a SOS bond store and supply
repacked goods as aircraft stores on a continuous basis.
This rule requires that we apply for permission at seven
Surely for bonded goods
This whole section is actually for bonded cargo.
Majority of the requirements are on the BOE. Why
does customs need to see the reference number and
the date of the sales invoice issued upon sale of the
goods, if the goods were bought? Evidence of origin?
Contracts of purchase and sale, license and royalty
agreements or other contract, transfer pricing
between trade company and its subsidiaries,
purchase orders issued by a prospective buyer while
goods in WH, invoices or other proof of payment,
packing slips, delivery notes. This is not needed for
free circulation goods, as duties were already paid.
Include a dispensation for continuous repacking
similar to current SOS bond stores
9
37
13.16
38
13.17 (1)(a)
38
13.17(2)(a)
days before repacking. This is not practical in an
environment where repacking takes place every day.
Timeframes for return or clearance of goods removed from
storage warehouses
An application for permission to remove goods from a
storage warehouse must be submitted to customs
electronically at least seven working days before the
removal of the goods,
Customs Code of warehouse
13.17(2)(b)
Customs Code of applicant
Would refer to Importers Code ?
42
13.19
A place to which goods are temporarily removed in terms
of section 310(b) and (c) must comply with the security
standards for storage warehouses referred to
in rule 29….
Why, when the licensee of the storage warehouse
has lodged surety to cover any risk
42
13.20
Storage of free circulation goods with goods not in free
circulation in same storage warehouse (section 299(2))
13
Rule regulating the Bonded Warehouse.
Only free circulation break bulk and bulk cargo may
be stored with non-free circulation goods. Why not
other cargo as well? Will it mean that goods when
are unpacked from the container that it will be break
bulk? Or what is meant by break bulk?
A general observation. There is reference to Rule 29
for the security standards. However Rule 29 still
needs to be published for comment
61
15.2
61
15.3
62
15.4 (1)
If alcohol and tobacco are imported into bonded warehouse
under tariff headings applicable to alcohol and tobacco
(chapter 22 and 24) and are now cleared out of bonded
warehouse using TH 9992.00.10 under the stores
procedure the entries will not tie up.
What is meant by own transport? Is it a vehicle registered
in the name of the stores supplier or can the stores supplier
sub-contract under this rule?
The three hour time limit is not workable; stores are
delivered to aircraft outside of normal business hours. Time
limit should be extended to two working days. Can a
customs broker submit an acknowledgement of receipt on
behalf of an airline, shipping line or railway line?
Recommend 14 days
Recommend changing from 7 working days to 24
hours
Would refer to Bond Store number
The tariff headings on the ex-bond entries must
remain the same as on the warehousing entries to
avoid confusion.
Transport sub-contractors must be allowed to move
goods on behalf of the stores supplier
Three hour time limit must be extended to two
working days.
10
62
15.4 (1) (b)
Is the time limit for a paper submission the same as for an
electronic submission?
74
15.20 (1)
Submission of, and information to be reflected on, stores
arrival reports
74
15.20 (1)
75
15.21 (1)
77
16.1
Timeframes for delivery of goods cleared for export to
depots and export terminals (section 368(1))
77
16.1 (a)
77
16.1 (a)
77
16.1 (c) (i)
Goods should not be subject to a 6 hour and a 12 hour
inspection as this is a duplication and unnecessary.
Should section 16.1(a) be applicable, then 16.1(c) should
not apply to containers delivered by a container depot.
This is not possible 12 hours before stacks, especially such
as explosives, reefers, perishables and so on that are only
accepted into the port shortly before the vessel sails.
77
16.1 (c) (ii)
77
16.1 (c) (iv)
81
16.8
Most airfreight shipments are already under time pressure,
and cannot be delivered nine hours before loading.
This is detrimental to this business which relies on urgent
and late cargo.
Recordkeeping by registered exporters
85
17
Section 405 – Rules made i.t.o. Sect 903
A stores arrival report must be submitted by the
carrier operating the foreign-going vessel or aircraft or
cross-border train to the customs authority
electronically through EDI. Why can this report be
submitted via EDI but the rest of the reporting must
be done through e-filing?
Can a customs broker submit a stores arrival report
on behalf of a carrier?
Can a customs broker submit a stores departure
report on behalf of a carrier?
The timeframe for delivery of goods at a container
depot at least 6 hrs, air cargo depot = 4hrs; – what if
this is perishable cargo, will there be fridges available
for cargo? 12 before export stack is closed, will there
be power points for reefer containers? 9 hrs for air
and rail export, 6 hrs for B/B cargo. No mention is
made for Road Freight. What about human remains?
Explosives? What is going to happen to the
containers when stopped, where will it be stored?
This requirement should be removed.
16.1(a) should be clarified.
This requirement is unnecessary and should be
removed. The stack already close 24 hours before
the vessel arrives, allowing sufficient time to manage
risks.
This requirement should be removed.
This requirement should be removed.
Year in which B/E was framed recommend 5 years
from year following.
No Rules with regards to (a), (b), (f), (g)(ii)
11
17.2
94
18.1 (1) (a) (b)
94
18.1 (3)
95
18.3
95
18.4 (2) (a)
95
18.4 (3)
96
18.5 (2) (a)
97
18.5 (3)
104
108
Pend for later comment
Application for approval of issuing associations located in
Republic
The licensee of premises carrying out inward processing
must give and submit undertaking contemplated in section
412 (d) (i)
A clearance of goods for inward processing must be
supported by a document setting out the measures taken in
terms of section 412(f).
Procedure for obtaining authorisation to redirect goods to
location other than licensed inward processing premises
(section 415(1))
A notification contemplated in subrule (1)(b) must be
submitted to the customs authority electronically through efiling
Regarding the notification
Approval by the customs authority contemplated in
section 395 of the Control Act must be applied for in
terms of this rule. An application for approval of an
issuing association must be
submitted by an issuing association electronically
through e-filing.
‘Undertaking’ to be clarified
In section 412(f) is reference being made to physical
goods?
when clearing multiple containers, an in-transit yard
would have to be utilised - procedure should be set
up for all holding areas
no time frame
Can an agent submit on behalf of the transporter
3 hours is not practical. Recommend 24 hours
18.5 (3) (e) (i)
A notification contemplated in subrule (1) must within three
hours of receipt of the goods be submitted to the customs
authority
A notification referred to in subrule (2) must reflect the
following information: the name, identity number, contact
details and address of the person in charge of that other
location
If not containerised a description of the goods including -
18.18 (2) (g)
certificates of origin –
Is this relevant?
a clearing instruction could suffice
The importer remains responsible throughout the
procedure – why is it necessary to include tariff
classification, quantity, volume, etc. In addition Rule
4.17 requires that an amended clearance declaration
must be submitted which would in any event reflect
this information.
12
110
18.21
Goods in free circulation used for processing may, subject
to a permission obtained in terms of rule 18.15, be stored
at inward processing premises together with imported
goods under the inward processing procedure. Subject to a
permission obtained in terms of Rule 18.15
This is not seen as a valid requirement for goods in
free circulation to be controlled. Would the goods in
free circulation require to be reported on? The
reference to section 432 (g) refers to imported goods.
Is this relevant?
Clarity required why the permission in terms of Rule
18.15 is required. This Rule determines that an
amended declaration must be processed for goods in
free circulation? Would goods in free circulation be
subject to the same timeframes? It is recommended
that there should not be a requirement to account for
goods in free circulation.
111
19.1 (1) (a)
if that licensee is the person clearing the goods, give the
undertaking contemplated in section 439(d)(i)
Detail relating to ‘undertaking’ is required
112
19.3
Procedure for obtaining authorisation to redirect goods to
location other than licensed inward processing premises
(section 422(2)(a))
Redirection
Should read section 442 (2) (a) Inward should read
home use.
It is not at all unusual for registrants under the home
use processing procedure to receive in excess of 200
containers per shipment. An example would be the
OEM manufacturers where 300 to 400 containers are
landed in a single shipment. The OEM’s cannot
physically receive and unpack 300 – 400 containers
and consequently those containers will be redirected
to a transit area, which may be a container yard, the
transporter’s depot or other premises. The redirection
has been in place for some time and always under an
authorisation of SARS Customs. In terms of section
439 (e) any import tax that may become payable
must be covered by surety and the transport of goods
cleared and released under this procedure is effected
by a licensed carrier. It follows that sufficient surety is
in place to mitigate any risks. The goods are not
redirected for permanent storage at that other
premises, it is redirected for temporary storage while
en-route to the licensed premises. In the
13
circumstances it would be counter-productive to
require a permission in terms of the conditions
attached to Rule 19.3 read with Rule 4.17. Rule 4.17
requires an amended declaration which will serve no
purpose. It is recommended that the other premises
could be considered an extension of the licensed
home use premises, bearing in mind that any import
tax is covered by surety. Rule 4.17 should be
reviewed accordingly to accommodate other
premises under this procedure. The temporary
storage of the goods whilst en-route should not be
subject to reporting as in Rule 19.5 (3).
Clarity is required why it would be necessary to take
stock of “any other goods on the licensed premises”.
Is there an obligation on the part of the licensee to
account for the other goods?
Section 448 (2)
(b) (iii) of the
Records and Stocktaking
CCA
124
20.1 (1)
The person who clears goods for outward processing must
give the undertaking contemplated in section 458(c)(i)
Clarify the requirements relating to ‘undertaking’
14
125
20.3 (1) (b)
129
24.1
If a statement referred to in paragraph (a) is submitted to
the customs authority, the submission must be on Form ….
‘‘courier article’’ means an article handled by a carrier in
the course of conducting a courier business;
Form to be specified
definition required
General Comments: 1. SAAFF and associated institutions would sincerely appreciate if SARS would consider affording time to discuss the Draft
Rules on an ad hoc basis prior to submission of commentary and the one-off workshops. 2. The commentary on Chapter 13 Warehousing
Procedure and Chapter 14 Tax Free Shop Procedure proved to be difficult in that it would appear that certain Draft Rules were irrelevant to the
procedure. Please refer to the attached discursive commentary Attachment A. 3. The provision for an application for permission to redirect
goods (Rule 13.2; 18.3 and 19.3) under, for example the Warehousing Procedure, Inward Processing Procedure and Home Use Processing
Procedure should take account of the logistics involved. For example, parts for motor vehicles could be 60 – 90 containers in a single shipment
cleared for warehousing procedure. It is not physically possible to deliver 90 containers nor can that storage warehouse operator unpack 90
containers at one time. It is common practice, on current authority of SARS Customs to stage delivery to the licensed premises. Those containers
may be temporarily stored, for convenience of transport, at the transporters depot or other suitable premises. The risk to SARS is in any event
mitigated in that the carrier is licensed and the warehouse has lodged suitable surety. The onerous application in terms of Rule 4.17 is conducive to
neither costs nor facilitation.
15
16