On March 10, the South African Revenue Service (Sars) released a notice titled ‘Become an Authorised Economic Operator (AEO) and enjoy the benefits’. Strangely, but unsurprisingly, Sars’ AEO landing page is silent on the benefits. Instead, there are these headlines: ‘About AEO’; ‘What is an AEO Programme?; ‘Sars’ AEO Programmes’; ‘Level 1 Accreditation AEO – Compliance’; and ‘Level 2 Accreditation AEO – Safety & Security’.
The first reference to benefits is on the second page, ‘How to become part of the AEO Programme’, where the headline ‘Benefits received once accredited’ clicks through to two images. The first, ‘AEO compliance benefits available to authorised economic operators’, stipulates the ten benefits as: access to client relationship manager; reduced security amounts; reduced inspections; expedited processes; priority to nonintrusive inspection; priority to TDN and VDN (the unexplained acronyms mean Tariff Determination Number, and Valuation Determination Number); inspection of goods at client premises; authorised use of AEO logo; mutual recognition with major trading partners; and coordination of other government agency intervention.
There is more. According to Sars, if you are a ‘Level 2’, AEO safety and security benefits include all AEO compliance benefits, including the following: exemption from certain customs provisions; priority of applications of extra special or extra attendance; no charges when special attendance required; provision of targeted training; provision of quarterly trade statistics; expedited refunds and drawbacks; reduced cyclical compliance audit for licensees; fewer inspections for compliance and supply chain security; exemption from security payments; mutual recognition with major trading partners (a repeat, or does the company get recognised twice?); and coordination of OGA intervention (a repeat – OGA as an acronym). So, nine additional benefits.
As to how many of the supposed ‘benefits’ offer a company actual financial benefits, I will leave that for you to adjudicate. It is evident that the apparent ‘benefits’ are a largely focused on the reduction of red tape, which is of government’s own making.
In its March 10 notice, Sars stipulates: “AEO is a company involved in the international movement of goods and approved by Sars Customs as complying with World Customs Organisation or equivalent compliance and supply chain security standards. AEOs may include manufacturers, importers, exporters, brokers, carriers, consolidators, intermediaries, ports, airports, terminal operators, integrated operators, warehouses, distributors and freight forwarders.” It continues: “Once your application is successful, you become an accredited AEO, with immediate access to benefits including substantial discounts on security.”
Strangely, ‘security’ only relates to Level 2, not to Level 1. But ignoring the detail for the moment, if you ‘Apply today’, Sars offers the following steps: Step 1: Contact the AEO team on AuthorisedEconomicOperator@sars.gov.za (mobile numbers of staff on the AEO website); Step 2: client relationship manager conducts client engagement with the prospective client; Step 3: complete and submit application and self-assessment forms; Step 4: documentary review and client relationship manager contacts you; Step 5: validation audits conducted; Step 6: accreditation committee considers application; and Step 7: if approved, client awarded AEO and access to range of benefits.
None of the documentation deals with the time for each of the steps. Are we talking about days, weeks, months, or longer? And what is the nature and extent of the information requested?
There is a 16-page ‘Systems Questionnaire’, “Effective 14 April 2014”. When last was it updated? If it has been in operation for nearly nine years, just how successful has the AEO uptake been? There is a seven-page ‘Accreditation Request for Information and Self Evaluation’, “Effective: 08 August 2019”, and a three-page “Application [form] for Accredited Client Status under Section 64E of the Customs And Excise Act, 1964”.
If it was Sars’ intention to sell AEO, it should heed the words of advertising tycoon David Ogilvy: “The more informative your advertising, the more persuasive it will be.”