Shipping Association blasts Customs Act Amendment Bill

Essentially, the act will not faciliate the formation of the Government’s proposed mega project – the logistics hub, reasoned SAJ in a release this week.

“What is being proposed as amendments to the Act, as they are now, are not amendments that will facilitate the hub. They are amendments that will increase the fines, and increase the power of customs rather than facilitate the movement of cargo,” SAJ general manager Trevor Riley argued in the release.

According to the over 71-year-old lobby group, the bill has enhanced the powers of the Commissioner of Customs to levy increased fines without substantially enhancing Jamaica’s global marketability as a modern, viable economic transshipment hub.

The SAJ statement comes in “support” of comments made last week by Pat Francis, chairman of Jamaica’s Trade Facilitation Task Force, a body that liaises with Government and the World Trade Organisation (WTO). Francis argued that the current amendment to the Customs Act failed to adequately address trade facilitation, but rather focuses on fines.

The SAJ also described the consultation process with the Jamaica Customs Agency (JCA) on the bill as “fraught with difficulty”.

“In fact the latest version of the bill has deleted much of what was initially proposed by the JCA and includes some new provisions that did not form part of our stakeholder consultations. It is on this basis and in light of the time and effort invested by the SAJ that stakeholders expected more fundamental changes to the Act,” noted the SAJ.

Excessive fines

In its formal comments on the bill, the SAJ pointed to the proposed increases in penalties under the act, with most being arbitrarily raised in excess of 100 per cent to $1 million.

“This has serious implications for the varied operators/importers/exporters who could well be put out of business by the imposition of such penalties for minor data errors, or for a failure to submit information within a prescribed time,” stated Riley.

The SAJ reasoned that under the proposed section 222A, the commissioner may require the production of documents and records within 14 days. A person who fails to do so within the period, upon summary conviction, would be slapped with a $2 million fine. However, the SAJ noted that in some instances, original documents may already be in the possession of customs, which would make any subsequent demand for them to be provided quite unreasonable.

“Additionally, the court is not even given the option to take into account the circumstances and impose a lesser fine,” argued the SAJ.

The SAJ added that the offences and penalties in the Act do not make allowance for “innocent mistakes”, in keeping with best practices around the world.

Last October, the Customs Act was initially amended to putatively quicken and improve customs clearance, and empower the commissioner to exempt for quick clearance medical and perishable goods.

There is currently another round of reforms with a bill set for debate in the joint select committee of parliament. Jamaica wants to halve the time and cost to export a shipping container in order to equal Panama, its regional peer. Improvement, however, requires a raft of multi-agency reforms across many ministries, guided by a revamp of the Customs Act of 1942, reasoned Francis at the meeting held last week at the Ministry of Industry in Kingston .

Francis wants the complete rewriting of the Customs Act in order to focus less on penalties and more on reducing trade impediments which hurt Jamaica’s competitiveness. It usually takes Jamaican businesses 20 days and US$1,530 per container to export, versus 10 days and US$625 in Panama, according to data in the Doing Business Report 2014.

At the same meeting, Minister of Industry Anthony Hylton and Minister without Portfolio, Ministry of Finance and Planning Horace Dalley urged technocrats and the Trade Facilitation Task Force to implement measures in order to increase the island’s competitiveness.

“We know we have a short-term [objective] of maintaining the integrity of revenues. Sometimes you have to forgo revenue in the short term in order to collect greater revenues down the road,” stated Dalley in an effort to spur the technocrats to think beyond narrowly increasing revenues at the cost of hampering trade.

Earlier this year eight ministries signalled a commitment to further enhance the trade environment in Jamaica with the signing of a Memorandum of Understanding with the Trade Facilitation Task Force.


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