Business Operators have been encouraged to participate in the Authorized Economic Operator (AEO), a World Customs Organization (WCO) programme that is being implemented in the East African Community (EAC).
Under the programme, the business community from different EAC Partner States can apply for the “AEO Status” which allows them to be handled as low risk companies that can be trusted by Customs.
This implies that Customs can deal with the consignments of such companies/business or individuals with less controls compared to non-AEO program members.
That way, the AEO programme is an instrument for growing compliance, according to officials.
AEO status bearers, irrespective of the EAC State they come from, go through the same set of criteria.
The programme aims to enhance efficiency in the face of increasing volumes of trade and the increasing vulnerability of the international trade supply chain to security threats as well as the use of the international trade supply chain as a conduit for high security risk materials.
It tackles challenges by shifting the perspective, so that instead of focusing on the goods themselves, Customs focus on the traders.
Speaking to The New Times, Yvonne Gatera, the Assistant Commissioner for Customs Operations Support at Rwanda Revenue Authority (RRA) described the AEO as “a program that facilitates legitimate trade in the EAC.”
She highlighted its benefits for the operators during the clearing process.
For instance, she noted that it allows importers, exporters and manufacturers to expedite the processing of entries and declarations, enjoy automatic passing of declaration, and no physical examination of goods – except for random or risk-based interventions.
It also permits them an Electronic Cargo Tracking System requirement waiver where applicable, expedites payments of their refund claims, reduces Customs security (Customs Bond Guarantee) where applicable, and gives them priority to participate in Customs initiatives.
For Customs Agents or Freight Forwarders, the AEO guarantees renewal of Customs agent’s licenses, gives them opportunity to participate in Customs initiatives, offers them priority treatment in the cargo clearance chain, as well as granting them a waiver of movement bond requirements.
Transporters also enjoy several benefits from the program, including guaranteed renewal of their transit goods licenses and any other licenses issued by Customs.
It also exempts them from the mandatory use of the Customs Electronic Cargo Tracking System (ECTS), and gives them priority clearance at entry and exit points.
For Bonded Warehouse Operators, the AEO allows them to self-manage their bonded warehouse, guarantees renewal of their Warehouse Operator’s license, and reduces Customs security wherever applicable.
How to apply for the AEO:
A call for application is sent by the Tax Administration every year. There is an AEO application and self-assessment form available on the RRA website.
Applicants are required to complete this form and submit it to the Tax Authority. AEO applications are assessed against the set EAC regional AEO eligibility requirements.
After this, the applicants who meet AEO eligibility requirements are recommended to join the EAC regional AEO program.
However, before the list of AEO successful applicants is submitted to EAC Secretariat, RRA consults with other Government Regulatory Agencies in charge of international trade as well as EAC Partner States Revenue Administrations to provide compliance status of the AEO applicants.
AEO applicants who do not have any non-compliance issues with RRA, other Government Regulatory Agencies in charge of international trade and Other EAC Partner States Revenue Administrations are then submitted to the EAC Secretariat to be put on the list of EAC regional AEO program and are given the AEO unique identifier that will be used to identify them across EAC Partner States upon making declaration of goods so that they can be facilitated.