Egypt has joined the International Convention on the Simplification and Harmonization of Customs Procedures (Kyoto Convention) according to the presidential decree 334 for 2007. The accession process was ratified by the Egyptian parliament in December 2007. Joining the convention would align Egypt’s customs procedures with those of the World Customs Organization standard. According to the Customs Authority, the convention is considered an instrument for the harmonization of customs techniques, which covers aspects of customs legislation. It also aims at ensuring that customs systems and processes are not barriers to international trade and growth. The Customs Authority is actively taking measures to implement the convention.
The GOE established an Account Management System to streamline and facilitate the customs treatment of large importers. (The GOE has also established a Large Taxpayer Center to provide similar services for large sales and income tax payers.) Two model customs centers which offer simplified procedures were opened in Alexandria and Suez in 2005, in addition to one in Damietta. Other centers were inaugurated.
Tariff valuation is based on either the worldwide price list received annually from foreign producers/distributors, or if that is not available, they take the highest price available in the local market. In cases where customs officials suspect under-invoicing, they usually add from 10% to 30% (called improvement percentage) to the invoice value. Importers have the right to take legal action against the Customs Authority in the event of a dispute regarding appropriate valuation, including arbitration that takes fifteen days or more. During that time, the disputed shipments are withheld and the importer has to pay fees as deposit until arbitration is over.
The Egyptian Government has established a “white list” of importers who, under some conditions, are able to avoid full inspection of their shipments.
The ability to fulfill local content requirements is no longer required to obtain an approval to set up an assembly project. However, assembly industries must meet a minimum local content requirement of 45% in order to benefit from customs tariff reductions on imported industrial inputs.
Current importing regulations require that every component of a product be inspected, regardless of the compliance history of the product, country of origin, exporter, shipper or the importer. No import can be put up for direct sale on the Egyptian market without first proving that it conforms to Egyptian standards, if it is on the mandatory list. If there are no Egyptian standards that suit the imported product, then it must be defined using the standards of one of the international organizations that Egypt is affiliated with e.g. ISO, IEC, and Codex Alimentarius. On arrival of a shipment to the Egyptian ports, the process that takes place is as follows:
1. A committee from the Customs and Security office checks the shipment for security reasons and determines whether there are any illegal products.
2. The importer presents Customs with the documentation required to clear the shipment.
After reviewing these documents, Customs either clears the shipments for release to the importer directly or directs the consignment to other bodies for testing and inspection. Custom duties are then assigned and are paid in Egyptian pounds.