The problem of putting blame on young officers when traders commit offences against the customs laws, is quite disturbing.
Yes, I am disturbed about the calling of young officers to suffer for the misdeeds and indiscretion of past Ghana Customs administrations. I, in person, do not see the reason why officers who have processed a customs bond for the removal of goods in transit should be disgraced and humiliated like criminals. Please, why should they be invited to the BNI?
The question is if a policeman processes a bail-bond and the offender jumps the bail, is the policeman asked to report to the BNI or it is the bail-bond which is enforced for the principal and sureties to produce the offender or pay the bond-penalty?
In the case of the transit transaction in question, wasn’t there a bond, and weren’t there a principal and sureties? I know that one of the conditions in the bond in question was that if the principal failed to export/re-export the goods, the bond conditions would be enforced to recover the duties involved. Why is the Customs administration not interested in going to court to enforce the conditions in the bond if the goods have indeed been diverted?
The question again is that have the goods been diverted? Have they been discharged into local warehouses, or were they found on the original trucks? If the vehicles were intercepted off the approved route for the goods, then that is another matter.I want the world to know that the Ghana customs bond now cannot be considered in any court as a serious legal document.
Before 1986, the Customs bond was considered as “cash,” which could be used in lieu of cash deposit and served as security for the protection of the revenue. When the angels descended on customs in 1986, they listened to the agitations of the trading public and without discretion and without customs knowledge decided to simplify and over simplified all Ghana Customs procedures without regard to international norms and tested standard practices.
SIX STEPS TO CLEAR GOODS
One typical example was the “six steps” for the clearance of goods from the ports. Someone got up one morning and said he had dreamed that the clearance of imported goods could be done with only “six steps.”
Step 1. Put together your import documents. Step 2. Write an application to Customs for the issuance of a permit and attach all the relevant documents including a dud cheque. Step 3. After the issuance of the permit, get the consignment struck off the manifest. Step 4. Go to the port for the examination and release of the goods. Step 5. Take delivery and drive goods out of port. Step 6. You may then decide whether to perfect the permit or not.
Almost all imports at the ports were therefore cleared on permit and this gave traders and agents the opportunity to loot the revenue. More than 95% of permits used in clearing the goods were left unperfected till today; and millions and millions of cedis were lost to the state. Those in authority, if they are alive, should be tried for causing “financial loss to the state.”
One other indiscretion was the liberalisation of the bond system. Before 1986, customs bonds were processed and issued only by the banks and were considered as equally good as cash deposits. They were, therefore, kept in fireproof safes in the station officer’s office.
What happened? The sole responsibility of the banks issuing bonds was taken from them and liberalised for persons without enough financial background to process and issue bonds to cover all customs transactions for fees. The result is that, go to the bond-seats at Tema, Takoradi or Akanu and you will find that bonds issued only a week ago are filed in a jacket at the seats, perforated by pins, and giving a good and clever lawyer the opportunity to argue in court that the pin holes suggests that there were other conditions attached to the bond.
One may ask, is this how bail-bonds are handled by the police? An offender jumps a bail and the bond is swiftly put in force but in customs if a trader fails to export or diverts uncustomed goods into home consumption the attention is turned on the officers who processed the bonds and not on the principal or the surety. The poor officer/officers who did what was wrongly introduced and had been followed by other officers since 1986 will suffer when the goods have problems.
When in 1968 Moses Ahiabu diverted warehouse goods into home consumption, the customs administration was initially not disturbed because they knew there would be a bond in force, which could be used to recover the duties involved and it was because the bond seat was manned by the most trusted and most respected officer.
But when they called for the bond and realised that the officer had not secured sufficient penalty to cover the goods, he was immediately interdicted and subsequently dismissed from the service. All the goods in Moses Ahiabu’s warehouse were seized/confiscated, and Moses Ahiabu was put before court and given a long jail sentence.
Today, when a trader evades duties by diverting uncustomed goods, he is treated with kid’s gloves while the poor officers who worked on the documents are humiliated and disgraced. What an occupational hazard!! Tell your wife you are going to work, and in the evening, she hears that you are in BNI cells. Why? You have worked on a consignment for transit, and the trader has diverted the consignment into the home market.
IMPORTANCE OF CUSTOMS BOND
Here, I want to emphasise the importance of the Customs bond. If the customs bond is effectively used, no person can just get up and say that he is in the transit business. You can not just get up and say you are exporting goods with a duty liability of GHc 150 million. As stated earlier, the Customs bond is as good as cash deposit and must be considered as such.
Let us look at the important and powerful role the customs bond plays in the entry of goods by looking at the definition of the term “entered” under sec. 151 of Act 891. (Unfortunately, the essential points have been deleted for no apparent reason) It states, among other things, that the Customs bond could be used to secure the revenue and could also be used in the payment of duties.
CUSTOMS MANAGEMENT LAW 1993
Let us look at the proper definition of the term “entered” in the Customs Management Law 1993 and the Customs Ordinance 1947. Here, we must take cognisance of the use of information technology and factor it in the definition. The term “entered” becomes very important when, especially, we want to settle a dispute over the determination of the “time of entry” after budget reading.
If serious persons and companies are allowed to do the transit business only a few persons and companies with integrity would deal with customs, and there would be no need for escorts because a “human-customs” officer and not a “beast-customs” officer would be at the exit point to confirm that the consignment has indeed crossed to foreign.
The authorities at the destination of the goods would also issue a Certificate of Landing to indicate that the consignment has been duly received into their territory; and the bond would be cancelled only when the station officer or his deputy is satisfied that the goods have been duly exported.
Management should permit some of our old officers, particularly the lawyers and some old experienced officers to examine the bond which was used in the transaction and see if it could stand the test of time in the court. Who issued the bond and in what capacity? Was the bond not a mere document used to support goods as a requirement but as a legal document? Are these officers not unfortunate that they are being used for “damage control”?
Whenever customs decides to review the customs law, it should not just rush because it wants to insert a provision-of-interest as in the case of the review of the Customs, Excise and Preventive Service (Management) Law, 1993, which resulted in the enactment of Act 891.
There was a big rush in the review which main aim was to consign the enormous powers of the Commissioner (the Comptroller of Customs) to the Commissioner General and to make the Commissioner (Comptroller) a mere mate to the Commissioner General. Some of the important interpretations were not in the usual traditional customs language, and some were deleted.
I can say with certainty that the Customs Management Law, 1993 was the best among all the Customs legislations. It contains all the necessary provisions for the smooth and efficient administration of the Customs Service.
I am saying this because I was privileged to have been contracted together with one American consultant by the World Bank to draft the ECOWAS Common Customs Code. (With the support of Mr. Felix Kwakye).
I, therefore, had the opportunity to study all the Customs laws in the sub-region and other
European customs administrations and I found that the Customs Management law, 1993 was a perfect piece of customs legislation which should have been adopted in its entirety with the necessary insertion and deletions as it was a consolidated law. What should also have been done was to insert the relevant provisions for the use of information technology.
We drafted the code and presented it to the ECOWAS Secretariat for fine-tuning, and it was later sent to be translated into French and Portuguese. The Code was signed into law by the Authority of the ECOWAS on 16th December, 2017. (Your brother is therefore a proud co-author of the ECOWAS Customs Common Code) You may Google.
I will also suggest that any time the customs laws are reviewed, we should take cognisance of the provisions of the Revised Kyoto Convention on the Simplification and Harmonisation of Customs procedures. It sets out the framework on which all Customs laws should be drafted and the standard practices. Fortunately, I have read the Convention alongside our Customs laws and practices, and I realised that our laws are consonant with the Convention except two provisions:
The first one is that, in our laws, we say goods imported temporarily into the country should be re-exported within three months, but the Convention states that such goods should be re-exported within six months. I am happy to state that now, sec. 75 of Act 891 has taken care of this omission.
The second is that, in our law, we say good cleared on exemption could only be disposed of after two years while the Convention states that such goods could be disposed of after one year.
In 1986, the Ghana Customs administration requested the UK customs to send experts to come and examine our customs laws and procedures. The experts’ conclusion was that our procedures were perfect and of international standards except that ships and aircraft files could not be closed at our ports, and therefore, we should be rated zero.
Customs cannot close a ship’s file if just one small package of cargo is not accounted for; therefore, you go to the ports, and less than 1% of ships’ files are closed in the year. Where are the outstanding goods? Have they been taken from the port without entries? Some of the files have been at the Manifest Closing Branch for more than forty years, suggesting that several millions of cedis have been locked up or lost.
Some of the files have been burnt to create space for new files. This needs serious investigation and redress. But I have a solution for this problem as a consultant.
The customs Code vol. 1 part 1 para 3 (a) states among other things that “the first duty (function) of the Customs officer (Customs in general) is to ensure that all goods imported or exported by ships, aircraft or vehicles are properly accounted for.”
It means that for all these years, Customs has not been working to find effective way of closing ships’ and aircraft files. Customs has not been working because of outside interferences in the performance of customs duties. The customs work is being performed by some officials from the Jubilee House and the Ministries and from agencies which claim to know better than customs officers and claim to be more pious than customs officers.
Also, the manifest branch, which is supposed to be one of the most important branches and the self-auditing branch, has been declared as a punishment ground by management for officers. Officers who are posted to the branch go to sleep and show no interest in the important work.
Another area of great concern is the auction of goods at the ports. Goods imported into our ports remain the property of the owners, and under no circumstances should the owners be deprived of their ownership except where the goods have been confiscated to the state. Even when the goods have been listed for auction, 48 hours before the auction, the trader can walk in to say he is ready to pay the duties and take delivery of his goods.
In Ghana now, there are professional auction dealers. All they do is they go through the ship’s manifest to look for consignments, especially perishable goods, which could fetch them huge profit. These professional auction buyers would arrange from the top for such goods to be sold to them at ridiculously low prices.
The 10th pillar of the Revised Arusha Declaration calls for good “Relationship with the private sector. Partnership with traders for better accountability.”
It therefore becomes necessary for customs to always protect the interest of the trader and not to cheat him. We cheat traders. We don’t respect them, and we forget that if they are not there, we shall not be called upon to perform any duty.
A trader buys a consignment for $50,000. He pays duties amounting to GHc45,000. He goes out to take GHc40,000 to pay for demurrage. He comes back to the port, and he is told that his consignment has been auctioned for just GHc25,000. Where is our Christian and Muslim faith?
The goods might have been sold to the girlfriend of someone in authority. The most annoying part is that if the trader puts in a claim for the refund of the GHc45,000 duty he paid on the goods, Customs would ask him to pay 10% penalty of the duty before the refund of the amount; and the frustration and delays he would go through could at certain parts of the world cause a trader to pull a pistol on an officer.
It is worse when it comes to the disposal of vehicles. Immediately the carrying vehicle docks people would be scrambling for copies of the manifest, and they would be selecting their dream cars and those for their girlfriends. Immediately the 60-day grace period elapses, they would order that duties should not be paid on any such vehicles, and they would share the vehicles among themselves by paying small sums as auction proceeds.
I can say without any fear that some Ministers of State have over the years been behind this shameful act. To be in charge of auction is better than some cabinet portfolios. Very lucrative and attractive!
I will, therefore, suggest that the process for auctioning should be explicitly stated in any new law for the Customs.
Nobody should auction goods without strictly following the process as stated in the law. Goods are auctioned for three reasons, one, to unlock the revenue therein, to decongest the port, and to protect the trader’s interest.
The assessment of the Reserve Price should, therefore, be made clear in the law and no trader should be made to feel cheated after the sale of his goods because the correct and appropriate surplus proceeds of sales would be refunded to him. We have cheated the Ghanaian trader for far too long.
It is my candid opinion that sec. 59 of Act 891 should be repealed so that all imported vehicles are treated like other cargo and are properly appraised and auctioned in the same manner as other cargo. The reason for the 60-day rule is no longer valid. The rule rather gives the opportunity for people in authority to steal and to deprive poor Ghanaians who have toiled in the snow to bring in vehicles to start their businesses at home of all their earnings abroad.
The allocation system is the easiest way of stealing from FELLOW GHANAIANS. It smells! Allocating all types of vehicles at ridiculously low prices is a crime. An articulated truck head for how much and who buys it?
A lot of revenue is lost through this smelly system. Can’t a proper system be established for the public auctioning of all cargo, including vehicles? Auctioning of uncleared cargo at the ports is the sole responsibility of Customs all over the world but here in Ghana, the blue uniform is worn secretly by persons at the Jubilee House, in both the present and past regimes, and in the Ministries to perform customs duties. The system must be overhauled to bring about fairness and absolute transparency in customs auction sales.
After all, it is not a crime to import vehicles into the country. Ironically, the vehicles would be allocated to all manner of persons but the customs officers who work on them would not be considered.
For the customs bond to be more effective and biting, I will suggest that the following method should be considered.
IMPROVING CUSTOMS BONDS
*All customs bonds should be issued only by accredited banks.
*All customs bonds executed by the banks must be supported by guaranteed cheques.
*Bonds should be either particular bonds or general bonds.
*The bond must be submitted to the head of collection, who would make sure that the bond is rotated and registered in the books.
*The head of collection would keep the bond in a fireproof jacket in a fireproof safe.
*Whenever a trader wants to use part of his bond to cover the removal of uncustomed goods, he should first apply to customs and a proper officer would be required to assess the appropriate bond penalty for that particular consignment.
*With the assessed bond penalty, the trader would be allowed to process his bill of entry.
After the entry of the goods, they would be examined externally, and the trader would be permitted to load his goods onto his truck(s), and the goods would be sealed with a customs seal.
All Customs stations on the route would be notified by wireless messages of the movement of the truck/s with details of the good.
The driver/s would be expected to follow the approved routes as stated on the bill of entry.
Whenever a driver encounters any problem, he should immediately report to the nearest customs office or police station or District Administration office and a report should be made to the Commissioner General by wireless message or by a telephone call.
When the goods arrive at the exit point of the country, the officer in charge would cause the documents to be thoroughly examined and would ensure that the seals have not been tampered with. He would allow the processing of the documents and would allow the goods to cross to foreign.
The officer in charge of the exit station would inform the office of export, (egTema) of the due exportation of the goods.
The trader, upon crossing to foreign, would demand a Certificate of Landing from the authorities, which he would use to support his claim that he has re-exported the goods and that the bond used may be cancelled
The officer in charge of the bond seat would examine all the documents presented by the trader and, when satisfied, would cancel the bond. The officer of the Bonds Seat would send the bonds register to the second in charge of the station for verification and signature.
With the bond firmly in the custody of the officer in charge of the station, there is no need to place human escorts to endanger the lives of officers. What is needed is to monitor the movement of the trucks and the period used to cover every distance/journey.
Where the goods are diverted or put to home consumption without authority, the trader should be arrested and put before court and made to pay the full duties with heavy pecuniary penalty and should be banned from transacting business with customs. Where necessary, the trader may be made to suffer jail in prison in addition to the pecuniary penalty. Here, we may spare our officers the ordeal of going to sleep in BNI cells. The misdeeds of a criminal trader should not result in an officer being called to the BNI to be humiliated and disgraced.
They had followed the old bad tradition and their only interest was to see that their station was always busy.
Finally, may I shamelessly and boldly suggest that the Customs Service should be detached from the GRA and made to function as we have in Nigeria for effective administration and the enforcement of the international customs laws with all the enormous powers of the Comptroller of Customs.
I do not mind who is appointed as the Comptroller or Comptroller General, but the person should be one with good knowledge of the customs laws and procedures. He should be firm and without blemish.
Written by Kofi Danquah (ex-Assistant Commissioner, CEPS Tema); (Ex-Officer-in-charge, Training, James Town); (Ex-Commandant, CEPS Academy, Kpetoe)
