Agents criticise customs penalty guidelines

'Right of appeal should precede payment' Alan Peat FORWARDERS SHOULD have the right to appeal first then pay up if they lose where customs penalties are concerned. That's how it should be, according to industry management in the Eastern Cape and supported by Len Joshua, chairman of the SA Association of Freight Forwarders (SAAFF) in Port Elizabeth. This in response to extensive complaints from small/medium forwarders in the region about what has been termed "crippling customs penalties". (FTW September 20, 2002) It's an issue that SAAFF has taken up with customs in the region, Joshua added. "Penalties and container stops are permanently on the agenda now for our monthly meetings with customs." Another problem on the agenda is customs' inconsistency, Joshua added. "They don't always impose the same penalty for the same type of error," he said. And, although forwarders are basically against the "R500 minimum" nature of the customs penalty, it's no small matter, according to Joshua. "Everybody has quality control systems to try to avoid making a clerical error, which could be for hundreds of thousands of rand," he said. Misdemeanour "That could see a penalty of many thousands of rand and not necessarily befitting the misdemeanour." Paul Kier, m.d. of Schenker & Co, and chairman of SAAFF in East London, agreed, citing a recent case of a R200 shipment hit with a R500 fine. "We have taken it up with customs that the penalty should fit the crime." But there's no use of discretion in such cases, Kier added. "You just get directed back to the penalty guidelines, as though this provides all the answers," he said. If that's the case, then these should be reviewed, according to Kier. But he doesn't find that customs is being particularly co-operative about the SAAFF call for a right of immediate appeal. "They are insisting that you pay the penalty then appeal," said Kier. "However, they have agreed that Ð where there are exceptionally high penalties Ð you can discuss it first with the local customs controller." But little is likely to come from this procedure, Kier added. "And you'd then have to ask for it to be transferred to Pretoria," he said. All a very time-consuming task, according to Denver Wright, branch manager of Ršhlig Grindrod in East London, and a local committee member of SAAFF, with customs very slow at making any decision. "We've tabled a proposal that you appeal first," he said, "but I don't know if that will alleviate the situation. We need to re-examine the guidelines imposed by the commissioner because of the worsening situation. "Quite simply, customs are imposing penalties where none existed in the past. Also the severity wasn't as high before." It's also now aimed at clerical errors, Wright added. "No fiscal error," he said, "only clerical. But counter staff just can't use their discretion now." This means that customs are no longer trade facilitators. "They're revenue collectors," said Wright. "They're getting no additional duty out of all this, only accruing penalty revenue. "It's becoming quite Draconian and I think they should back off." Joshua agreed. "The view from industry," he said, "is that customs should not report to the SA Revenue Services (SARS). That makes them revenue focused, and not fitting the accepted international role of customs being trade expeditors."