Exports – Dispelling a fallacy

October 11, 2011 — 6 Comments

Following my previous post on ’empty container depots’, its time to dispel a long time myth basically perpetuated to safeguard the cargo handler’s imagined responsibility that goods delivered to be packed for export must be first cleared through Customs. There is no current law, rule or policy which supports this notion, and neither is there any liability on stuffers, consolidators, container depot, transit shed operators, empty container depot operators to ensure that goods they receive under instruction to pack for export have been pre-cleared with Customs.

Let’s first consider what a Customs export declaration implies. Generally, a declaration for export is lodged with Customs subsequent to the conclusion of a sales agreement between a local supplier and a foreign buyer via the commercial bank. The forwarding agent will arrange foreign shipment with a carrier, obtain commercial documents (pro forma invoice, required regulatory permits/certificates, etc.) and prepare a declaration for submission to Customs on behalf of the exporter.

The acceptance, by Customs, of an export declaration is no more than a formal notification of an exporter’s intention to exportnothing more. It is therefore untrue that an ‘approval to export’ or ‘release for export’ notification is the last word from Customs. Moreover, it is also incorrect to reason that Customs has no right to intervene in a ‘transaction’ subsequent to clearance. In essence the notion of an export ‘consignment’ only materialises once the goods are packed, sealed and ready for delivery to the point of international cartage ; or, more accurately, when the ‘secured goods’ are reported for delivery to the place/port of export. Only at this point can risk be evaluated in all its dimensions and a final decision by Customs (load/no-load) be pronounced.

The advent of advance information, post 9/11 and subsequent proliferation of ‘secure export’ initiatives means that ‘risk’ in relation to international cargo movements encompasses three key areas – information, conveyance and cargo. To merely accept whats declared on the export is insufficient for Customs. Other potential risks involving a multitude of people with a lesser liability, little appreciation for accuracy, and little or no sensitivity towards the safety and security of goods in their custody may compromise the ‘compliant’ intent of the exporter and clearance broker at time of initial customs clearance.

It is therefore plain to see why SARS Customs is modernising not only its procedures and systems, but also its enabling legislation.  A new export clearance and cargo reporting dispensation is envisaged, to be accompanied by the licensing of cargo handlers and their premises and the implementation of a seal integrity programme.

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6 responses to Exports – Dispelling a fallacy

  1. 

    Hi Mike..

    If as you say above, “an export declaration is no more than a formal notification of an exporter’s intention to export – nothing more” and “the notion of an export ‘consignment’ only materialises once the goods are packed, sealed and ready for delivery to the point of international cartage” – the delivery to the point of international cartage being the “port”, at what point (if any) does customs “inspect” the cargo where required..??

    Is there any process of communication in place between the shipping lines, customs and port to stop a container at the port of departure if required to be inspected by customs..?? What percentage of export containers are stopped for inspection on a normal basis..??

    • 

      Hi Manaadiar,
      Trust you are well and thanks for the enquiry. Under the international security regime, export cargo requiring intervention will occur at the point once the export advance manifest information is lodged to Customs. In South Africa, we don’t as yet have such requirement in place. Cargo is pretty much selected for inspection based on the export declaration information. The notion of customs risk management (a future modernisation release for SARS) includes interrogation of both declaration and manifest information. This in effect covers the key entities in the supply chain (supplyside). Export consignments are generally subjected to X-Ray scanning as opposed to physical inspection due to the limited time available before the goods are laden on board the vessel. SARS has introduced an EDI (CUSRES) notification which ALL so-called release authorities receive advising them of the status of the cargo, i.e. whether the goods are approved or stopped. At this point not all cargo handlers and carriers are fully mechanised with SARS so there is a gap where non-EDI release authorities will still insist on a customs-stamped release notification. You are no doubt aware of SARS’ recent drive to mandate electronic communication with ALL cargo operators. As to the percentage of export consignments stopped, it is less than 2% the last I looked.The licensing of cargo operators (Carriers, Terminal Operators, NVOCCs, Depots, etc.) and the introduction of an AEO Security Programme will in future oblige the timeous submission of cargo information (vessel schedules, consolidation/outturn reports, packing/stuffing details, loading/discharge reports, etc.). Thesed details are alluded to in the draft Customs Control Bill, available on the SARS Website. I hope that I have answered your questions.

  2. 

    Hi Mike;
    A sample from SARS production environment would be very interesting for me 🙂
    Thanks and happy new (incoming) year !!!
    Regards,
    Giuseppe

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