A word of caution about misleading wording

We recently acted in a matter where we applied for a tariff determination on behalf of a client. The determination made by the tariff section at head office was, in our view, wrong. On our recommendation our client sought to appeal against the "decision" and wanted to refer the matter to Internal Administrative Appeal (IAA). The tariff section said that IAA was not applicable in this instance and that the matter should be referred for Alternative Dispute Resolution (ADR). While this may seem innocent on the face of it, this could have given rise to serious complications. If, as was our view, the matter could not in fact legally be referred to ADR, the appellant could have fallen outside the strict 30-day time limit in which an IAA must be instituted. We therefore sought clarity from Sars’ Legal and Policy division as to the meaning of Section 77 I. More specifically Rule 77 I.02 provides that ADR may only be instituted where: ● A party is not satisfied with the decision after an Internal Administrative Appeal; or ● As an alternative to judicial proceedings. The Sars Legal and Policy division has confirmed that there are only two instances where a matter can be referred to ADR. It seems that the tariff section erroneously relied on paragraph 5.3 to the Sars External Policy – Alternative Dispute Resolution – Reference no SC-CC-26. This document provides that, due to the technical nature of tariff evaluation matters "ADR would normally only be resorted to in cases where all relevant facts and/or arguments were presented to and considered by the Tariff Evaluation division and the importer does not agree with their decision". A caution to all out there that this wording is misleading and that a policy document or guideline can never trump the provisions of the Act. One must therefore follow the provisions under Section 77 and the rules thereto in respect of IAA and ADR. If you are in doubt as to the correct procedure, please contact us on 0860customs.