New customs law in Egypt

UK Club’s correspondents in Egypt, Middle East Survey & Control Office (MESCO), have drawn UK Club members’ attention to a new Customs Law, which came into effect in Egypt on November 12th 2020.

Law number 207 incorporated and amended the rules and procedures of the old law, (Law number 66 from 1963).

The law and the customs exemptions law number 186 from 1986 has been revoked.

MESCO said that the new law aimed to encourage foreign investment, unify and simplify the procedures relating to international trade, streamline customs release operations and procedures, and improve the customs tax refund process.

The ultimate objective was to increase Egyptian exports.

The law also sought to reduce corruption and it clarified the penalties on violators and smugglers.

It has introduced a revised post-clearance audit process, which will aim to control import and export activity more efficiently, promoting a faster release of goods at the borders.

MESCO said that the new law had brought in many controversial changes and amendments, especially on matters addressing the carrier’s liabilities.

The new Customs Law reduces the number of documents exporters and importers have to submit to the Egyptian Customs Authorities from 11 to six.

Articles 51-57 introduce for the first time the work of Customs Clearance Agents, defining their role, setting controls for their practice and implementing their authority, as well as setting out the penalties they may impose when dealing with violations.

The previous four-month period for Owners of unclaimed goods to reclaim their goods has been reduced to one month. After this period, the ECA will have the right to sell the goods or assign them to any government authority or agency without charge.

Article 39 requires the importer or his agent to present documents relating to the goods to the Customs Authority before the goods are shipped so that the goods can be marked with an initial customs registration number. This initial registration number must be notified to the shipper for it to be inserted into all shipping documents for any goods imported, failing which, the goods will not be allowed to be discharged at Egyptian ports, and will have to be re-shipped elsewhere at the expense of the carrier. MESCO noted that Article 39 ignored the fact that many shipments, when originally shipped to any port, were not destined for a specific party. “The receiver could be designated or specified during the voyage”, MESCO said.

The new law emphasizes the carrier’s responsibility for validating the description of the goods entrusted to them for carriage and makes the carrier a primary responsible party should there be any discrepancy in the description following an inspection of the cargo. MESCO said that “this seems to be unjust and impractical in cases of containerized cargoes, since containers are stuffed by the shippers without any supervision or intervention by the carrier. The shipper and the cargo interests should therefore be solely liable for any inaccuracy in the cargo’s description.”

The new law provides that the carrier shall be liable for any damage to seals affixed on containers and bear the risks associated with the discharge and/or storage of containers at yards other than yards designated by the Customs.

MESCO concluded that the most controversial provision in the new law was that, if the importer failed to complete the customs’ formalities to clear out the cargo, the carrier would become liable for re-shipping the goods or dispose of them at the carrier’s own expense.—new-customs-law/