24 June 2017

Ethiopia: Customs Authority Cries Foul Over Stalled Containers

Photo: Daily News
(File photo).

Most of delayed containers are those transported with multi-modal cargo service

The Ethiopian Revenues & Customs Authority (ERCA) has instructed container owners to clear 7,900 containers that have stayed over sixty days at Modjo and Qality dry ports. Out of these containers, 7,000 of them are placed at Modjo Dry Port while the remaining dwell at Qality Dry Port.

This was declared at the consultative meeting held at the premises of ERCA on June 20, 2017, with the presence of heads of Modjo and Qality dry ports, Addis Ayele and Teklay Abraha, respectively.

Most of the delayed containers are those which were transported with a multi-modal cargo service. Importers clear their tax after the arrival of the containers. But containers which come with a unimodal cargo service settle taxes before the arrival of the containers.

The unimodal service ends at the port of Djibouti, after which the consignee will choose their transporters and enter an agreement to receive the cargo in the country.

Every day a minimum of 300 containers arrive at Modjo Dry Port with multi-modal freight services, recorded in a single document, according to Addis.

There are also importers who pay their taxes on time but leave the containers at the ports, according to the managers of ERCA.

"Some container owners do not pay the tax up to the last day of the grace period. So they let the container be stored up to the date of expiry," claims Addis.

Recently, 128 containers were confiscated at Qality Dry Port. Also, a month ago, 105 owners immediately paid their bill when the Authority auctioned 305 containers. Before the auctioning of the properties, the owners were notified to clear their cargoes via telephone, SMS, e-mail and in physical contact.

During the same period, ERCA also confiscated 40 vehicles that arrived at the dry ports without opening letters of credit, bank permits or clearing all the paperwork.

On the other hand, for the delay of clearing their containers at ports, importers point their fingers at the Ethiopian Shipping & Logistics Services Enterprise (ESLSE), banks and ERCA.

"It will take 15-30 days to correct a Bill of Lading, and there is also a problem of price estimation," said Deju Adera of Capital Business Plc. "We have imported the same goods for ten years, but the price changes every time."

The other thing most of the importers complained about is the opening of a Letter of Credit (LC). They claimed it takes four to eight months.

"Previously, we removed our containers with a bank guarantee, but now it is forbidden," said an importer who engages in the manufacturing sector.

It took eight to nine months to process LCs, and during such periods the price of the supplier fluctuates, and this is creating confusion in their business, according to this manufacturer.

"Let's stop pointing fingers at each other. Let's start to see from inside out," Debele Kabeta, director of customs branch offices follow-up and support at ERCA said. "This is the only way forward to improve this mess."

During the meeting, Kebede Chane, director general of ERCA warned the importers.

"Before we take serious measures, you have to pay what you owe," said Kebede.

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