As the world continues to reel under the pressure of the ongoing Covid pandemic, the clearing and forwarding industry is working hard to recover losses incurred over the past two years.According to Nalini Maharaj, senior consultant in the shipping and logistics division at Shepstone & Wylie Attorneys, as the sector begins to recover, one of the key trends emerging is to review the financial position of each entity. “Many companies have been hard hit by the effects of laying out capital spend on behalf of importers who were subsequently unable to reimburse such entities,” she said. “A thorough assessment of customers’ financial position before acceptance of clearing instructions is therefore critical. It is recommended that systems be implemented which clearly depict customers with a negative financial status in contrast to those who should be prioritised, that is, those with sufficient financial security.”Another trend to hit industry is that of cyber phishing. “It seems to be on the rise in the logistics industry. The nature of the clearing and forwarding industry is such that it is dependent on digitally equipped electronic systems and applications and, as a result, it is inherently prone to cyberattack. It is therefore recommended that the relevant software programmes and financial applications of each entity are closely monitored by trusted engineers and personnel on a regular basis.”Commenting on the challenges facing clearing and forwarding companies at present, Maharaj said with the South African Revenue Service (Sars) undergoing transformation in discharging its mandate to enforce stricter compliance, one could expect more detentions, investigations and an even more dogmatic approach to ensuring compliance.“The impact of this transformation will undoubtedly have a ripple effect on the clearing and forwarding industry, specifically more detentions than usual, requests for further documentation, higher storage and demurrage charges, and more physical examination of goods. Importantly, it must be borne in mind that the Customs and Excise Act makes provision for joint and several liability, and clearing agents can also expect to receive more letters of demand. There are also specific industries upon which the customs microscope is focused, such as fuel, alcohol, tobacco and clothing and textiles.” But, she said, given the foresight of the transformation in the customs sphere nationally, there was no better opportunity than the present for the sector to conduct and implement efficient housekeeping measures to ensure compliance with the provisions of the relevant tax legislation. “Not only will this reduce the risk of potential liability, but will also streamline internal compliance strategies along with the impending developments at Sars. The global economy has been impacted by the pandemic and the clearing and forwarding sector has not been exempt from this setback. However, the restoration of the economy as it steadily rises from the ashes of the pandemic can, in fact, be construed as the perfect opportunity for the sector to ensure that proper systems and practices are in place and that if there are any grey areas, legal clarity is obtained immediately.”Maharaj is upbeat about the outlook for 2022 because although clearing agents and forwarders will face more stringent measures adopted by Sars, this will also open opportunities to ensure compliance and attract a wider clientele. “From a legal perspective, and as part of our personal interaction with the sector, some of our initiatives at Customs@Wylie include dissemination of groundbreaking judgments, workshops to upskill on specific legal issues that the sector faces, legislative updates by our professional team on latest legal developments, notice updates on relevant customs legal issues, and developing a professional and personal relationship with the sector. These initiatives are tailor-made to suit the needs of each client. Therefore, whilst it is a challenging period, with the implementation of proper control and compliance measures, it could also be an extremely fruitful era for the sector. Seize the opportunity,” she said
