The Southern African Customs Union (SACU) comprising of South Africa, Namibia, Botswana, Lesotho and Eswatini is currently undergoing migration from HTS 2017 to HTS 2022. This blog post covers
– The progress made so far
– Key implications of the migration
– Why the migration is taking place?
What’s the progress so far? And what is the outlook for January,2022?
The COVID-19 outbreak has forced the discussions to be held virtually. 3 meetings have been held between the SACU and the WCO to track the progress on the implementation of the Activity Plan and the SACU 2017-2022 Roadmap for Migration formulated in January, 2020.
– 1st meeting: July, 2020
– 2nd meeting: April, 2021
– 3rd meeting: August, 2021
Here are the key milestones that have been achieved so far
– The HS Migration Framework and the Roadmap for Migration from HS 2017 to HS 2022 have been developed. 1st January 2022 has been marked as the completion target.
– Initial comments on the first set of HS 2022 related draft tariff amendments have been obtained from the private sector at national and regional levels and have been duly considered.
– A 2nd set of draft amendments were published for public consultation. The consultation period ended on the 31st of July 2021.
– National advance ruling systems have become operational in some Member states.
– The work on HS migration has been incorporated into the broader SACU Trade Facilitation Programme.
– A SACU Working Group on HS, Tariff, Origin and Valuation has been established to ensure the successful migration from HS 2017 to HS 2022.
Most of the work on the preparation of amendments for implementation is expected to be completed by October, 2021. Member states will be undertaking final legislative and administrative processes to meet the January, 2022 target. A meeting will be held in January, 2022 to make a final assessment on the readiness of the Member states for this transition.
Key implications of the Migration to HS 2022 and adopting a new system for amending CET
– This will facilitate uniformity in goods classification within the Union
– Member states will develop a regional framework on advance rulings.
– Issues for consideration under the regional framework include the recognition of
rulings across the SACU, whereby a ruling issued by one Member State would be
binding on all National Customs Authorities when the same holder uses the ruling to
import the goods.
– The framework will enable a Customs officer from one Member State to refer to
existing rulings issued by all Member states, and to consult an officer from another
Member State should he/she find inconsistencies in the rulings previously issued.
– The framework will enable SACU Customs administrations to enhance uniformity in
the interpretation of the HS throughout the Customs union.
Why is this migration taking place?
The purpose is to promote uniform classification of goods within the Customs Union and contribute to the overall management of the CET. The SACU Secretariat has in recent years been working with the WCO Secretariat as part of a specific capacity building programme funded by the European Union (EU): The ‘EU-WCO Programme for the Harmonized System in Africa’ (HS-Africa Programme).
The Programme was launched in 2019 and aims to deliver assistance to Regional Economic Communities (RECs) and Customs administrations in Africa in implementing the 2022
Edition of the HS. In the longer term the goal is to build organizational capacities and resources to apply future HS versions in a timely and coordinated manner.
Discussions on the topic began in November, 2019 between WCO Secretariat Experts and representatives from the Lesotho Revenue Authority (LRA) during a diagnostic mission on the implementation of the HS and advance rulings on the classification of goods in Lesotho.
The need for a regionally coordinated process of migrating to new editions of the HS and of managing advance rulings was identified at this discussion. A recommendation was made by the experts to arrange a meeting between SACU members.
The SACU regional meeting was held in January, 2020. The objective was to take stock of various issues
– Preparations made for the implementation of HS 2022 in each SACU member.
– Management of HS matters within the Union in general.
– Implementation and management of advance rulings relating to the determination
of tariff classification.
An activity plan was agreed upon at this meeting. This included
– Development of a Migration Framework and a Roadmap for Migration from HS 2017
to HS 2022.
– Establishment of a SACU Working Group to coordinate the implementation of HS
2022 and to work on amending the CET in future.
– National information campaigns to promote awareness.
– Establishing of advance ruling systems for tariff classification.
– Ensuring availability of relevant HS tools.
How Cargowise and CargoDoc will help with this transition?
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Keywords
SACU – Southern African Customs Union
WCO – World Customs Organization
CET – Common External Tariff