New customs regulations announced on July 2, 2000 have brought Egypt closer to compliance with global trade standards, but Business Monthly Magazine reports that many local businesspeople are concerned about the prospects of their implementation.
As it so happened the new regulations were introduced at the last moment. Because of the World Trade Organization (WTO) customs deadline, the Egyptian government was forced to rush the passage of new legislation to replace Customs Law 66 of 1963. The government now has less than a year to actually begin implementing the new customs valuation system.
In January 2000, the Egyptian government requested from the WTO a three-year extension on a deadline for compliance with the General Agreement on Tariffs and Trade (GATT). The WTO, however, only granted it a one-year extension.
The new regulations shift the bias of customs procedures in favor of importers. Article 23 of the law makes invoices submitted by the importer the primary basis of customs valuation. Under the old system, an importer's invoice could only be used if the amount paid was greater than the most recent international reference price for the same product. The new systems will allow importers who reduce their purchasing costs below the international average to enjoy higher profits rather than pay excessive customs duties.
In early June, heads of departments at ports and airports explained the new law to customs officials. This caused chaos in the business community, as industrialists were upset that they had not been consulted. Importers, however, are reported to be generally pleased by the customs reform.
In the short-term, implementation of the new law will lower revenues for the customs authorities. But it expected that the legislation will encourage increased trade, and so there should be no significant loss of revenues. – (Albawaba-MEBG)
© 2000 Mena Report (www.menareport.com )