Last week, the Egyptian Customs Authority (ECA) announced that a new draft customs law had been sent to parliament for approval.
Sayed Kamal Negm, chair of the ECA, said that the new law sought to facilitate the process of finalising official procedures for importers and exporters. The bill includes simpler, less time-consuming, and less-costly procedures for releasing cargos.
One source working in a family import-export business and preferring to remain anonymous told Al-Ahram Weekly that the changes were urgently needed.
“It takes almost a month to finalise the procedures required for releasing a container. The inspection process is also very complicated and time-consuming,” he said. Throughout this process, companies pay fees for the space taken up by their goods at the port if they are there for longer than 21 days. “The fees are paid in US dollars, not Egyptian pounds,” the source added.
These factors play a role in increasing the cost of goods, he said.
The new draft law stipulates that importers and exporters will have to present six documents, as opposed to 11 in the existing law, to the ECA to finalise procedures. Scanned documents may be admissible under the new law as opposed to hard copies.
Negm said that 87 X-ray devices had been installed at several customs sites and by the end of this year 100 other devices would be available for use. This would make the process of inspecting imported and exported cargos easier, he said.
“The new law will be beneficial for the manufacturing and investment sectors in Egypt and will help Egypt to improve its classification globally, as established by the World Bank,” Negm said.
The ECA is currently examining means of reducing the time taken to release a cargo to three days, starting from its date of inspection, as opposed to 26 days currently, Negm noted.
He also spoke of a “white list” of importers whose goods would be cleared without passing through full procedures. The white list system began last November and encompasses companies that have a track record of good conduct. So far, applications from 52 companies to join the list are being reviewed, and more are being accepted.
Talk of amendments to the customs law first surfaced in August 2019, when the Finance Ministry spoke about amendments made to the executive regulations and the customs system as a whole.
“Tax and fees assessment for commodities will be determined according to Article 7 of the General Agreement on Tariffs and Trade (GATT), and the new amendments aim to unify customs assessment systems for commodities that are transferred in the transit system and to curb the misuse of facilities introduced in this regard,” the ministry said in a statement.
Prime Minister Mustafa Madbouli decided in December to establish one or more permanent joint committees at every customs port to ease release procedures.
The ECA, the General Organisation for Import and Export Control (GOEIC), the Egyptian Food Safety Authority, the authorities for agricultural and veterinary quarantining, and other institutions will be involved in these committees.
They will develop mechanisms and timetables for opening containers or packages and produce reports on inspection and control processes.
Ahmed Shiha, a member of the Importers Division at the Cairo Chamber of Commerce, told the Weekly that the new law was “definitely a good step” forward.
“Every minute you spend with customs means money. Business owners currently spend at least a month to release their containers,” he said.
Shiha said that it would take some time to see the impact of the new law on foreign investment in Egypt. “Foreign investors first need to see how the new law is improving business conditions in Egypt,” he explained.
The new customs law stipulates that all the paperwork related to customs should be finalised before the arrival of containers. This should mean that products can be released promptly and at lower cost once they arrive in the ports.
*A version of this article appears in print in the 30 January, 2020 edition of Al-Ahram Weekly.