Your Questions: Answered - Written by on Tuesday, March 6, 2012 16:35 - 3 Comments

How can I deal with concerns about demands for payments by customs officials? Your questions answered. By Peter Lloyd CEO Mabey Group

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Dear Peter,

I am CFO of a business looking to expand outside our traditional markets of the UK and northern europe.

I am concerned about the Bribery Act as I have heard a lot of scare stories about the local customs officers and demands for bribes to get goods imported into the country in various emerging markets. What are your top tips for businesses considering making the leap to new markets where local customs office practices appear at odds with the Bribery Act?

Peter’s answer:

In some parts of the world, and not just in the emerging markets, it is rather too common to have customs officials asking for payments as part of the clearance operations at the ports and airports. These payments are often called facilitation payments and frequently the payments are presented as an expense, such as the need to work overtime or the cost of bringing in additional labour.

I remember one port where there was a charge for processing orders outside normal working hours, so at a premium hourly rate, but if the officials are to be believed, then it is only possible to move the goods at these ‘premium’ times.

Obviously any such payments are bribes and are illegal under the Bribery Act and probably under the local law as well.

I suggest that you use a reputable freight forwarder, probably UK based, who will provide a meaningful confirmation in writing that no such payments will be made and is subject to UK law just as much as you are. Usually experienced freight forwarders will be more than capable of avoiding these payments, often by making formal complaints to the senior managers or senior government officials.

I have often heard it said that customs officials soon learn who will pay and who will not, concentrating their efforts to obtain payments on the easiest targets and then the ethical companies can simply trade normally to avoid drawing attention to these illegal practices.

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Bribery and the Rich and Famous «
Mar 7, 2012 10:11

[…] an approach to bribe demands by customs officials, rather than immigration officials, see here. Share this:FacebookTwitterStumbleUponLinkedInEmailPrintLike this:LikeBe the first to like this […]

Subash Murray
Mar 7, 2012 14:31

Even though you may use a reputable customs broker, it is not always the solution. One has to know the land ot land i.e. local laws. Having said that, one should work with the heirachy of the management in that department. I have had many instances during my tenure over two decades in South America while investigating into FCPA matters. Since that tiime, Governments have changed their mind and now are inclined to tow the line into understanding the consequences and their results over educting their staff in compliance and good governance. It takes time, effort and resources to educate and make them aware over RISKS involved in asking, receiving and giving Bribes and third party payments without justifications. From the start one has to lay down the policy, vision and mission over these elements. Hope this is helpful.

Jean Samuel
Mar 9, 2012 5:56

It is helpful for staff operating in these situations to have something they can produce e.g. laminated card to show customs officers etc their company’s policy zero tolerance on ABC and facilitation payments. It acts as a reminder of good phrasing to use, starts the highlighting of this a company that falls into Peter’s ‘will not pay’ bracket and so may reduce future requests for payments. If it includes company policy on raising the issue with the appropriate authorities, that also give them pause.

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