Concerns raised over ‘draconian’ penalties in new Customs bills

The application of penalties for companies found contravening the new Customs bills remains a major concern to the freight forwarding industry. According to Johan Marais, South African Association of Freight Forwarders (Saaff) Customs consultant, concerns about the proposed penalty code have been raised with Sars but as yet there’s been no feedback. “As the new Customs Control Bill, Customs Duty Bill and Excise Bill stand now, any company found to be in contravention more than three times will lose its licence and will not be allowed to operate,” Marais told delegates at the Saaff annual general meeting in Johannesburg last week. “We believe this to be draconian and unacceptable and have communicated this to Sars. At present though there has been no feedback.” Currently a company found contravening the Customs Act is given a choice of a fine, which is related to the seriousness of the matter, or criminal charges. Should a company pay the fine the matter is then automatically concluded. Under the new Bill this will however change, said legal adviser Freek van Rooyen. “The new law states that Sars will retain the right to bring criminal charges if and when they choose to do so, despite a company having paid a fine if found to have contravened the law. This means that any contravention can be held against a company for as long as Sars intends to do so.” And both experts agree stepping out of line three times is not difficult. “This part of the new law is a very serious concern and one that we continue to address as it is draconian to say the least,” said Marais. “We also believe, after much deliberation and analysing of the new Customs Control Bill, that this is all about control and not necessarily revenue generation.” He said the new Act was aimed at controlling imports and exports from the point of origin to the final destination and keeping that in mind it did bring opportunity. “You will have a sustainable business going forward and you will be involved in the process from beginning to end. We are more optimistic about the new bills now than we were initially.” Marais said Saaff continued to engage with Sars on the bill. The revenue service has started to comment on some of the proposals and comments made on the drafts. “We don’t, however, expect to see Sars move this legislation through Parliament by October as was the initial intention. The process is still very far from being finalised.”