On 29 March 2023, the South African Revenue Service (Sars) released its 6-page “Validity of Import Entries” guide, which provides information for you to comply with Sections 39 (Importer and exporter to produce documents and pay duties) and 40 (Validity of entries) of the Customs and Excise Act, 1964 so that costs of non-compliance can be avoided.
The Guide is divided into the following headings:
- Purpose
- Introduction
- Customs and Excise Act, 1964
- What is an entry?
- Must all entries comply with the conditions and requirements prescribed in Section 39?
- Must all entries be valid?
- What is a valid entry?
- What are the implications of an invalid entry?
- What should I do if I discover that I have delivered an invalid entry or an entry that does not in every respect comply with Section 39?
The ‘Introduction’ reads:
Commercial goods imported into South Africa must be cleared through customs. Clearance through customs is made on a bill of entry. For a Bill of Entry (BOE) to comply with the Act, 1964 it must meet the requirements prescribed in Section 39 and to be valid it must comply with Section 40(1).
The Commissioner is, under Section 117 (Statistics), charged with compiling and tabulating import and export trade statistics. The Commissioner for Sars primarily determines import and export trade statistics from data declared on bills of entry. Correctly declared bills of entry ensure the integrity and correctness of trade statistics published by the Commissioner for Sars and used by other government departments to, amongst others, make important trade policy decisions.
Your compliance is important to compile correct and reliable trade statistics, to assess the correct duties and taxes due, to determine if the goods may be prohibited or restricted, or to qualify for preferential treatment or for a rebate of duty.
Importers are required to do a self-assessment to determine their obligations under the Act, 1964.
Due to the volume of goods imported, it is not feasible for customs to audit every entry or inspect every consignment. As a result, customs uses a system of risk management and risk assessment. According to the risk, consignments may be released or may be subject to further interrogation such as documentary inspections and, if required, physical inspections at the time of entry. Consignments released without interrogation may be subject to post-clearance audits after release of the goods.
Failure to make a correct and valid entry may result in additional costs associated with non-compliance such as detention costs, additional duties and Value-added Tax (VAT), penalties and in certain cases, forfeiture of the goods to the state. In serious cases where there is false declaration, fraud or misrepresentation or non-disclosure of any material facts, prosecution of offenders may be pursued.