Pakistan Customs Problems and Their Solution

Last Updated: May 22, 2015
Category: Import & Export
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A meeting was held with the Karachi Customs Agents Association (KCAA) in the Conference Room of the MCC-Exports, 3rd Floor , Customs Housem Karachi. The issue which were communicated by the Association were discussed one by one and following decision were taken thereon:

Issue No.1
For consignment where duty drawback is calculated on the basis of percentage and the sales tax is zero rated, weightment should be exempted. Whereas the same practice may be adopted where duty drawback is claimed and sales tax is not levied.

The KCCA was of the view that all the consignment, which are subject to examination should not be weighted as in some cases, weight is immaterial. After discussion, it was decided that the present practice of weighting all the containers grounded would be discontinued. The consignment of manufacturers wherein no concessionary SRO has been claimed; or the goods have been sold on unit basis, and the rebate or dutydraw has not been claimed or is less than 1% would be exempted from weightment. The concern Terminal Operator would be conveyed this decision through an Office Order by the AC/DC (Wharf). Moreover, Keeping in view the aforesaid criteria, the DC/AC wharf will decide, as to whether a consignment marked to red by system or otherwise should be subject to weightment or not intimate the same to the Terminal Operator accordingly.

Issue No.2
Recently the consignment of exporters entitled to Green categories are being subjected to examination, which results into delays and over-burdened of workload. This practice should be stopped.

The collector briefed the participant the need of continuous monitoring of the consignment going through the green and yellow channel. He also highlighted the fact that more than 90% of the FCL export consignment were being cleared through the green channel, and recently after a brief drive of diversion of consignments from green and yellow channel due to non submission of Form-E, compliance level has improved.Now only a few of suspect consignments are being diverted. The Chair also briefed how the DTRE users were trying to misuse the green channel so that the automated system could not read the GD as DTRE GD and the user gets the consignment cleared through green channel instead of red designated for all the DTRE GDs. He also informed them that, recently, cases of mis-declaration of PTC wherein regulatory duty was accordingly decided that the Collectorate shall keep monitoring the green channel to control its misuse. He assured then that only suspected consignment would be diverted from Green to Red. The Association agreed to it.

Issue No.3

Currently the concerned Appraising Officer (AO) changes the value of the goods unilaterally without consulting the concerned exporter. In such cases an option to notify the exporter and seeking their explanation should be incorporated.

The Association was of the view that the Appraising Officer (A/O) unanimously assesses the value and the exporter is not given any opportunity to justify the declared value. The AC Export (West Wharf) informed that the Collectorate is maintaining a database of values of various items and assessment is made as per these values. He further informed that if any exporter is not satisfied with assessed value, he can file a review to AC/DC (Wharf). After detailed deliberation, it was decided that, henceforth, the Assessment Officer would first send “Call documents” message if he is not satisfied with the Declared Value(DV). The exporter would be given forty eight hours time to respond to the message; if he is not satisfied with the assessment. In case no response is received from the trader within forty eight hours, the AO shall assess the GD on the basis of available evidence.

Issue No.4 
In case any narcotics or contraband items found in the consignment of an exporter the NTN of the concerned exporter should be blocked and the Customs Agent should not be subject to any disciplinary action like Show Cause Notice or Blocking of Licenses without having any proof of their involvement.

it was agitated by KCCA that, as soon as, any narcotics are intercepted at port, the Collectorate immediately block the ID and NTN of both the exporter and clearing agent. The Association was of the view that such action should be taken againts the clearing agent if his involvement is found after investigation. It was, accordingly, decided that the MCC shall block the NTN of Clearing Agent temporarily without forwarding their case to licensing branch. The proceedings for cancellation / suspension of license shall only be initiated if his involvement is found by the investigating agency.

Issue No.5
Proper list of internationally registered BRANDS may kindly be provided.

The KCAA was informed that proper list of international brands cannot be provided as there are thousand of registered brands both locally and internationally and making a consolidated list was not possible. The KCAA withdrew its demand being non-practical.

Issue No.6
Uploading of documents required by Customs issued from any Government Department as SOP to this effect should be prepared, as uploading of any required documents at the time of Gate-in is not possible, but can be made after Gate-in within suitable time duration. Therefore, an option may kindly be provided for uploading of the requisite documents after gate-in

The KCCA reported that there are certain documents which are not required by Export Policy Order or any other law at the time of exports. Some documents are required / demanded by the buyer abroad but the customs insists that such documents be uploaded with GD. Discussion were held on this issue and it was unanimously decided that the customs will not insist on documents which is not require by law as stated above and consequential liability, if any, in this regards after shipment would be on trader/ exporter.

Issue No.7
Acute shortage of customs Export staff at every Export Station is observe which is required to be resolved.

The Collector informed that the Collectorate is also suffering from the shortage of staff and the matter has been taken up with FBR to post additional staff in the Collectorate.

Issue No.8
Appraiser name should be mentioned on the respective station and GD should be completed at the same station.

The Association informed that, for assessment purpose, the GD of a Wharf / Port is marked to Appraising Officer, irrespective of his place of posting. Normally, GD file at one wharf is marked to another wharf which results in delay in exports. The Collector informed the participants that Change Request in this regards has been sent to Directorate of Reforms and Automation for necessary changes in the system.

Issue No.9
Delay in grounding of container for customs examination is on the part of Terminals. Therefore, the terminal may be advised to avoid such delay and necessary arrangements in this regards may kindly be made.

The Collector informed the participants that matter of delays on part of Terminal Operator regarding
grounding / stuffing / re-stuffing has already been taken up with the Terminal Operator and meeting in this regards was also held with them who assured proper redressal of complaints for export cargo.

Issue No.10
Marking of container for DEC examination should not be done by officers / officials below the rank of assistant Collector.

Regarding marking of container for Drug check, it was informed to the participants that consignment of well known and reputed exporter are already not marked for DEC. Only the consignment of commercial exporter and / or relatively new exporters are subjected to this check and Collectorate would continue this practice.

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