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Customs Cargo Clearance Processes at Liberia
Seaport and Land Borders
June, 2020 Yusador S. Gaye, CPA, CGMA
Auditor General
PERFORMANCE AUDIT REPORT
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Table of Content
1 CHAPTER ONE: INTRODUCTION ...................................................................... 1
Background of the Audit ................................................................................... 1
Motivation of the Audit ..................................................................................... 1
Objective of the Audit....................................................................................... 2
Scope of the Audit ........................................................................................... 2
The audit objective is detailed by the audit questions described below: ................ 2
Audit Methodology ........................................................................................... 3
Methods of Data Collection ............................................................................... 3
Documents Reviewed ....................................................................................... 3
Interviewed and questionnaire .......................................................................... 3
Site Visits ........................................................................................................ 3
Sampling ......................................................................................................... 3
Assessment Criteria .......................................................................................... 4
2 CHAPTER TWO: DESCRIPTION OF THE AUDIT AREA ....................................... 5
2.0 Description of the Audit Area ................................................................................ 5
2.0.1 Introduction .................................................................................................... 5
2.0.2 Development of the Liberia Revenue Authority ................................................... 5
2.0.3 Mandate .......................................................................................................... 5
2.0.4 Policy and Legal Framework .............................................................................. 5
2.0.5 Vision and Mission of the LRA ........................................................................... 5
2.0.6 Stakeholders roles ............................................................................................ 6
2.0.7 APM Terminal .................................................................................................. 6
2.0.8 Bureau Veritas (BIVAC) .................................................................................... 6
2.0.9 National Port Authority ..................................................................................... 6
2.0.10 Custom Broker Union of Liberia ......................................................................... 6
2.0.11 Ministry of Commerce and Industry ................................................................... 6
2.0.12 Source of Funding to the Liberia Revenue Authority (LRA) ................................... 6
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2.0.13 Customs Cargo Clearance Process map .............................................................. 7
3 CHAPTER THREE: FINDINGS............................................................................ 9
3.0 Findings ............................................................................................................. 9
3.1 Overall ............................................................................................................... 9
3.2 Interagency involvement with Customs Cargo Clearance process ............................ 9
3.3 Complex payment procedures for customs duties .................................................. 12
3.4 Unclear Customs Cargo Clearance procedures at land borders ............................... 12
3.5 Lack of automated system at major Land borders ................................................. 15
3.6 Poor security for Cargo at Land borders ............................................................... 16
4 CHARPTER 4: CONCLUSION .................................................................................. 19
4.0 Conclusion ......................................................................................................... 19
5 CHAPTER FIVE: RECOMMENDATIONS ........................................................... 20
5.0 Recommendations .............................................................................................. 20
5.1 Interagency involvement with Customs Cargo Clearance process ........................... 20
5.2 Unclear Customs Cargo Clearance procedures at land borders ............................... 20
5.3 Inadequate training for Customs Broker ............................................................... 21
5.4 Lack of automated system at major Land borders visited ....................................... 21
5.5 Poor security for Cargo at Land borders ............................................................... 21
APPENDIXES ........................................................................................................ 22
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Acronyms Meaning
AG Auditor’s General
ASYCUDA Automated System for Customs Data
BIVAC Bureau VERITAS
CBOs Customs Business Office
DI Destination Inspection
ECOWAS Economic Community of West African States
GAC General Auditing Commission
LRA Liberia Revenue Authority
NPA National Port Authority
PSI Pre – Shipment Inspection
WCO World Customs Organization
WTO World Trade Organization
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Definition of Key Terminologies
APM
Terminal
APM Terminals is the operator of the Freeport of Monrovia: the gateway to the Liberian
economy.
Assessment Determination of the amount of duties and taxes payable
Brokers A person who carries on the business of arranging for the Customs clearance of goods and
who deals directly with the Customs for and on behalf of another person
Cargo Goods or merchandise conveyed in a ship, airplane, or vehicle
Clearance The accomplishment of the Customs formalities necessary to allow goods to enter home use,
to be exported or to be placed under another Customs procedure
Consignee The person or company to whom goods or documents are officially sent or delivered
Cumbersome Difficult to do or manage and taking a lot of time and effort
Customs The Government Service which is responsible for the administration of Customs law and the
collection of duties and taxes and which also has the responsibility for the application of
other laws and regulations relating to the importation, exportation, movement or storage of
goods
Customs
Assessor
A person responsible for taxability and value of properties, using methods such as field
inspection, structural measurement, calculation, sales analysis, market trend studies, and
income and expense analysis.
Customs
Examiner
A Customs officer whose duty it is to examine and estimate the true value of imported
goods subject to customs duties.
Declaration A statement made in the form prescribed by Customs, by which the persons interested
indicate the Customs procedure to be applied to the goods and furnish the particulars which
the Customs require to be declared for the application of that procedure.
Examination Physical inspection of goods by the Customs to satisfy themselves that the nature, origin,
condition, quantity and value of the goods are in accordance with the particulars furnished
in the Goods declaration
Import duties
and taxes
Customs duties and all other duties, taxes or charges which are collected on or in connection
with the importation of goods, but not including any charges which are limited in amount to
the approximate cost of services rendered or collected by the Customs on behalf of another
national authority
Kyoto
Convention
The expression commonly used to refer to the international Convention on the simplification
and harmonization of Customs procedures adopted by the Customs Co-operation Council in
Kyoto in 1973.
Revised
Kyoto
Convention
The expression commonly used to refer to the international Convention on the simplification
and harmonization of Customs procedures (amended), adopted by the Customs Co-operation
Council in Brussels in 1999.
Stakeholders A person such as an employee, customer, or citizen who is involved with
an organization, society, etc. and therefore has responsibilities towards it and
an interest in its success
ECOWAS Economic Community of West African States
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Customs Cargo Clearance Processes at Liberia Seaport and Land Borders
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Republic of Liberia
Transmitter Letter
The Honorable Speaker of the House of Representatives and Honorable President Pro-
Tempore of the House of Senate:
We have undertaken a performance audit on Customs Cargo Clearance at Seaports and Land borders
for fiscal years 2016/2017 through 2018/2019. This audit was conducted in line with the Auditor
General’s statutory mandate as enshrined under Section 2.1.3 of the GAC Act of 2014.
The audit was conducted in line with the International Organization of Supreme Audit Institutions
(INTOSAI) auditing standards and guidelines as enshrined in the Performance Audit Manual. The Act
that created the Liberia Revenue Authority (LRA) and guidelines, were also used as a baseline for the
evaluation of the performance of the LRA Customs Department.
As indicated in the methodology segment of this report, all findings conveyed in the report were
formally communicated to the Management of Liberia Revenue Authority for their responses. Where
responses were provided, they were evaluated and incorporated in this report. We are therefore
thankful to the auditee (LRA) for assisting the audit team in completing this audit.
We ask that you pay particular attention to the following matters that if implemented the customs
cargo clearances at seaports and land borders will significantly improve and reduce the bureaucracy
and thus ease the lives of citizens:
• Significantly review the customs cargo clearance processes and align interagency mandate
to avoid replicated Customs cargo clearance process.
• LRA should consider installing cargo/goods scanning camera system similar to the luggage
scan that are used at international airports. The scan will be analyzed by Customs and other
government agencies to check whether the content match the cargo description and whether
illegal cargo will be found, thus eliminating the several handling stages employed currently.
• Ensure that officials assigned at land borders are following the standards set for monitoring
activities effectively during cargo clearance.
• Accurately disseminate new information and policies on cargo clearance to stakeholders that
are actively involves in the clearing of cargo
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• Ensure that stakeholders have and meet the necessary requirements and equipment to
enhance their functions in the clearing process.
• Ensure bi-annual refresher trainings for Customs Brokers to improve their understanding of
customs cargo clearance procedures.
• Install solar energy power and repair existing solar power system that will effectuate ASYCUDA
at land borders.
• Install ASYCUDA at major ports of entry (land and seaports) to facilitate trade and service
delivery in customs administration that will further improve, trade statistics, accounting
procedures, reduce transaction cost, clearance time and conduct transaction electronically to
mitigate negotiation.
• To protect cargo at the land borders, fence should be constructed and warehouses renovated.
Giving the significance of the matters raised in this report, we urge the Honorable Speaker and the
Members of the House of Representatives and Honorable Pro-Tempore and Members of the Liberian
Senate to consider the implementation of the recommendations conveyed herein with urgency.
Monrovia, Liberia
December, 2020
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Executive Summary
The audit reviews the customs cargo clearance at Liberia land borders and seaport in compliance with
Liberian laws as well as international standards because of Liberia’s membership in World Trade
Organization (WTO) and Economic Community of West African States trade group (ECOWAS). The
clearance of cargo is vital to the growth and development of Liberia’s economy as it is a key revenue
source as an import dependent country.
The Annual Trade Bulletin report for 2017 of the Ministry of Commerce indicates that Liberia continues
to import a significant amount of goods ranging from petroleum products, consumable commodities,
machinery, electronics and transportation equipment as some of the major cargos that are cleared
through customs ports of entry. Liberia has an open economy and is very favorable for trade which
represents 120% of the country’s Domestic Gross Product.1
In addition to the international standards, the audit has also considered the Sustainable Development
Goal (SDGs) which focuses on strengthening the means of implementation and revitalizing global
partnership of sustainable development; and, especially target 17.10 which emphasizes equitable
multilateral trading system under the WTO.
The Customs Department of the Liberia Revenue Authority (LRA) has the statutory mandate to collect
customs duties on imports or exports at all ports of entry. The core taxes collected by Liberia’s Custom
are international goods and service tax (GST) and well as excise tax, a flat-rate tax, which applies to
specific goods services and activities. The Customs Department also serve as the lead border agency
for processing international trade and has absolute responsibility to serve as the repository for
international trade statistics.
The Objective and Scope of the Audit
The audit assessed the extent to which the Customs Department ensures timely clearance of cargo.
It further considered whether customs cargo clearance procedures implemented by the Liberia
Revenue Authority (LRA) Customs Department are simplified, free of delays. After the audit, the
auditors expect to see improvement in customs cargo clearance at land borders and seaports that
will curtail issues such as delays, cumbersome processes and bureaucracy.
The entity audited is the Liberia Revenue Authority Customs Department and the periods under audit
are fiscal years 2016/2017 through 2018/2019 and focuses on customs cargo clearance at seaport
and land borders.
Key findings
The LRA has developed its strategic and business plans and targets to ensure cargos are release
timely and that customs procedures are simplified for importers who use various ports of entry in
Liberia. However, there continues to be underlying issues with customs cargo clearance at seaports
and land borders despite all of the measures the Liberia Revenue Authority has implemented.
1 World Bank Trade Indicator (% of GDP) 2018
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Interagency involvement with Customs Cargo Clearance process
The Liberia Revenue Authority is responsible to facilitate legitimate trade, customs clearance through
borders and social protection through policies and procedures that promote efficiency, simplicity that
enhance taxpayer compliance in Liberia.
The audit revealed that the Freeport of Monrovia uses the Automated System for Customs
Data (ASYCUDA) which is a computerized system designed by the United Nations Conference on
Trade and Development (UNCTAD) to administer a country's customs. ASYCUDA is use for all steps
in the cargo clearing processes. However, there are manual processes that include the stamping and
signing of paper documents that burdens customs procedure.
Cargo/good imported in Liberia passes through long customs bureaucracy before it is clear from sea
and borders ports. Furthermore, it was determined that processes in clearing cargo are repeated by
other agency of government.
Unclear Customs Cargo Clearance procedures at land borders
The Customs Department of LRA is responsible to develop and maintain standards, guidelines and
apply modern techniques and technology to facilitate and ensure simplification and harmonization of
Customs procedures.
Considering the involvement of other agency of government in the inspection of cargo before
clearance at land borders, the auditor noticed deviation from the published Customs procedures at
land borders.
Below listed are some of the procedures that are different from the official procedures published by
the Customs Department as the result of other government agency involvement:
• Separate examination by all of the agencies (Liberia Drug Enforcement Agency (LDEA), Liberia
National Police (LNP), National Security Agency (NSA), Ministry of Commerce and Ministry of
Agriculture) that are assigned at these borders when said examination should be coordinated
by customs at one location.
• The policy of paying 4% on goods, if Cost Insurance and Freight (CIF) is more than US$110.00
and if the consignee does not have business registration- according to the Ministry of
Commerce and Industry Guide on Operating Business in Liberia, a Presumptive Tax of four
percent (4%) is due no later than 15 days after each quarter. This is applicable to Small
business whose gross annual sales are $LD 200,000.00 – LD3, 000,000.002.
• Paying the amount of US$20.00 for ECOWAS brown card when bringing vehicle into the
country. The ECOWAS Brown Card Scheme was established by Protocol A/P1/5/82 signed by
the Head of States and Governments on 29th May 1982 in Cotonou (Benin Republic)
The main objective of the scheme is to guarantee to the victims of road accident a prompt
2Ministry of Commerce http://www.moci.gov.lr/doc/MoCI.BusinessHandbook.013017 page 12 3 ECOWAS Brown Card https://www.ecowas.int/specialized-agencies/ecowas-brown-card/
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and fair compensation of damages caused by non-resident motorist from ECOWAS member
states visiting their territory3.
Lack of automated system at major Land borders visited
The LRA Customs Department objective 4.1 is to deploy and operationalize modern revenue
administration technology to improve compliance and attained effectiveness. Furthermore, Section
4.1.6 states that rural and urban field offices (CBOs) should reliably connect to core business system
(LRA Headquarters) through mobile connection points and other available management information
systems infrastructure.
All the five major rural land borders visited within Liberia lack the automated system (ASYCUDA) to
determine importers bills per the price list for custom payment. As a result, customs cargo clearance
procedures and calculations are done manually which could lead to declaration being
understated or overstated by consignees resulting to inaccurate customs duty to government or
overpayment by consignees.
Poor Security for Cargo at Land borders
The Customs Department is responsible to facilitate legitimate trade and customs clearance through
borders and social protection through policy and procedures that promote efficiency, simplified and
enhance taxpayer’s compliance. Customs authorities also serve as semi security apparatus for borders
protection in carrying out their responsibility. Therefore, the Customs Department is required to
provide security for goods imported into Liberia.
The rural customs borders lack full protection for goods or cargos imported into Liberia. In addition,
warehouses are not in good condition to store goods that could lead to goods or cargo being damage
before the consignee or importers even complete the clearance processes.
Conclusion
The customs operations are regulated by national legislation and international agreement to ensure
easy movement of goods across borders. With the global pressure for effective trade amongst
countries and the need to standardize customs procedures for cargo clearance through customs entry
point, Liberia can make a significant improvement if the Customs Department implements those
International customs agreements to ensure an expedient movement of cargo through seaports and
land borders in Liberia.
Importers and brokers are enduring replication of customs procedures with the involvement of other
agency of government, incurring lot of charges because customs brokers and officials are not fully
acquainted with cargo clearance procedures. Additionally, many securities apparatus are also
interfering with the physical and documentary inspection of cargo that is hampering the convenient
movement of cargo at land borders and seaports in Liberia.
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Recommendations
For the Customs Department of the Liberia Revenue Authority to ensure cargo clearance processes
is streamline to enable importers receive their goods within the minimum time requires, we
recommend that the Customs Department should:
• Significantly review the customs cargo clearance processes and align interagency mandate
to avoid replicated Customs cargo clearance process.
• LRA should consider installing cargo/goods scanning camera system similar to the luggage
scan that are used at international airports. Customs and other government agencies will scan
cargo to check whether the content match the cargo description and whether the cargo is
illegal, thus eliminating the several handling stages employed currently.
• Ensure that officials assigned at land borders are following the standards set for monitoring
activities effectively during cargo clearance.
• Accurately disseminate new information and policies on cargo clearance to stakeholders that
are actively involves in the clearing of cargo
• Ensure that stakeholders have and meet the necessary requirements and equipment to
enhance their functions in the clearing process.
• Ensure bi-annual refresher trainings for Customs Brokers to improve their understanding of
customs cargo clearance procedures.
• Install solar energy power and repair existing solar power system that will effectuate ASYCUDA
at land borders.
• Install ASYCUDA at major ports of entry (land and seaports) to facilitate trade and service
delivery in customs administration that will further improve, trade statistics, accounting
procedures, reduce transaction cost, clearance time and conduct transaction electronically to
mitigate negotiation.
• To protect cargo at the land borders, fence should be constructed and warehouses renovated.
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Customs Cargo Clearance Processes at Liberia Seaport and Land Borders
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1 CHAPTER ONE: INTRODUCTION
Background of the Audit
1.1.1 The Liberia Revenue Authority Customs Department is responsible for the collection of all
import duty, goods tax, excise imposed on importation, ECOWAS trade levy, fees on export
and other fees related to international trade. Customs also ensure compliance with all
legislations relating to the movement of goods and the facilitation of legitimate trade and
border management. Therefore, effective customs procedures play a critical role in trading
as well as expedited clearance, control that secures revenue collections.
1.1.2 In addition to domestic customs legislations, Liberia as a member of WTO, ECOWAS and a
UN member that adopted the UN Agenda 2030, to align it cargo clearance policies with
international standards. Further, in achieving goal 17 under the United Nation 2030 Agenda
for Sustainable Development Goals (SDGs), a country has to promote a universal rules-
based, open, non-discriminatory and equitable multilateral trading system under the World
Trade Organization, including complete conclusion of negotiation under its Doha
Development Agenda is a target for trade clearly describe as sub-goal 17.10.
Motivation of the Audit
1.2.1 Customs cargo clearance at ports of entry in Liberia is very significant to the development
of Liberia by means of the contribution of Customs to the national budget. Customs
contributes about 37% to the national budget and also plays critical role in trading and
border security.
1.2.2 Customs cargo clearance process at ports of entry in Liberia is stay plague with procedures
delays. Though the Government of Liberia sought European Union (EU) support through
her Long-Term Technical Assistance to the LRA that provided training to over 300 Customs
staffs to enhance their efficiency and capacity at implementing customs procedures and
established a Modernization Unit.
1.2.3 The LRA has on its website that it takes a minimum 5 hours and the maximum 5 days to
clear cargo at the Freeport of Monrovia provided the importer are in compliance with
Customs. The Liberia Domestic Revenue Mobilization Strategy Plan (FY2018 -2020)3
revealed that importer take more than (5) days and up to fourteen (14) days to clear cargo
at Freeport of Monrovia.
1.2.4 There have been mass media reports4 5 6 of delay with customs cargo clearance at the
Freeport of Monrovia linked to Customs officers. It is against these conditions that the
Auditor General Commissioned this Performance Audit to assess the cause of delays and
any performance problem relating to Customs Cargo Clearance at Seaport and Land
borders.
3 https://revenue.lra.gov.lr/domestic-resources-mobilization/ 4 Frontpageafricaonline.com/business/apm-terminals-new-measures-constraining-liberian-custom-brokers/ 5 allafrica.com/stories/201612160414.html 6 (Liberia Revenue Authority) Domestic Resource Mobilization Strategy in Liberia FY 2018-2022, p24
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1.2.5 Liberia is an imports dependent country and livelihood of her citizenry mainly depends on
budgetary contribution from customs to generate more domestic revenue. For example,
during the period audited, Customs Department of the Liberia Revenue Authority
contributed about 37% to Liberia National budget shown below in Table 1. The amount
would be larger if the custom processes improve and more goods are imported and cleared
through customs.
Table 1: FISCAL YEAR IN MILLIONS US$
2016/17 2017/18 2018/19
Customs Department Contribution 184,742 186,227 171,889
Other Tax Revenue 200,744 189,656 222,308
Other Non-Tax Revenue 80,163 46,469 74,159
Total External Grants & Loans 90,130 30,173 12,650
National Budget Actual 555,779 452,525 481,006
Percentages 33.2 41.0 36.7
Average 37
Source: Extracted Liberia National Budget 2016-2019 with percentages and average done by GAC
Objective of the Audit
1.3.1 The audit assesses whether customs cargo clearance procedures implemented by the LRA
Customs Department are simplified and free of delays. After the audit, the auditors expect
to see improvement in customs cargo clearance at land borders and seaports free of delays
and cumbersome processes.
Scope of the Audit
1.4.1 The audit focused on LRA Customs Department particularly on customs cargo clearance at
land borders and sea borders. The relevant structures, procedures and practices involved
with customs cargo clearance. The audit covers July 1, 2016 to June 30, 2019, and is
complemented by facts relating to international and regional customs cargo clearance
processes.
Limitation of the Audit
1.5.1 The audit was limited to five major land borders (Bo-Water side, Buutuo, Ganta, Luoguotuo
and Jorweh) and one seaport (Freeport of Monrovia).
The audit objective is detailed by the audit questions described below:
1. Does the CBOs ensure cargo clearance processes at land borders and seaports are
simplified for customs Brokers?
2. To what extent Customs Department ensure staffs and necessary stakeholders are
trained to handle cargo clearance
3. To what extent monitoring of CBOs is done to ensure a free movement of cargos.
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4. To what extend are recommendations from monitoring of CBOs been followed
Audit Methodology
1.7.1 The audit was conducted in accordance with the requirements of the General Auditing
Commission’s (GAC) Performance Audit Manual, which is based on the International
Standards of Supreme Audit Institutions (ISSAI) 3000. The use of these methodologies
listed below to understand the audit area, obtain sufficient, relevant and reliable audit
evidence that support the conclusions and recommendations.
Methods of Data Collection
1.8.1 In order to carry out the audit, data were collected from documents reviewed, interviews
conducted with key players and sites visited to gather information about the audit.
Documents Reviewed
1.9.1 Laws, policies, regulations, structures, processes, systems, practices and related
documents and databases.
Interviewed and questionnaire
1.10.1 Interviews were carried out with key personnel at operational, middle and senior
management levels of the:
• Liberia Revenue Authority, Customs Department
• Customs Brokers association of Liberia
• Consignees
• APM Terminal management
• Shipping lines
1.10.2 The interviews and questionnaires were used to confirm the information obtained from the
documents reviewed and for providing more explanation where information was not
available in the reviewed documents.
Site Visits
1.11.1 The audit team visited five of the seventeen land borders, (Ganta, Louguotuo, Buutuo, Bo-
waterside and Jorwah) that represent 29% and one Seaport (Freeport of Monrovia) to
ascertain understanding delays in the Clarence of cargo, causes and if the activities carryout
are monitored.
Sampling
1.12.1 The annual revenue reports activities of all land borders and seaports vested over the
period July 1, 2016 to June 30, 2019 were examined to have an appreciable understanding
on the performance of each CBO. Non-statistical sampling was used in the choice of visits
to Customs Business Offices across four out of the fifteen counties (Montserrado, Grand
Cape-Mount, Nimba, and Bong). These four counties were selected based on accessibility
and performance over the years audited. We visited these entry points to find out if there
are delays, causes, level of monitoring and to understand customs cargo clearance
procedures at Land borders and Seaports
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Assessment Criteria
1.13.1 Criteria used as a basis for evaluating the evidence collected, developing audit findings and
reaching conclusions on the audit objectives were extracted from the following sources:
• The Liberia Revenue Authority Act 2013
• Liberia Revenue Code (Custom laws) as amended 2011
• Liberia National Trade Policy of 2014-2019
• LRA Annual Strategy plans. Details of the audit assessment are found in
subsequent chapters and the appendix.
• UN Agenda 2030, Goal 17 and targets 17.10
• World Trade Organization Agreement
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2 CHAPTER TWO: DESCRIPTION OF THE AUDIT AREA
2.0 Description of the Audit Area
2.0.1 Introduction
2.0.1.1 In this Chapter, the regulatory framework and related strategic plans governing customs
cargo clearance at seaports and land borders are defined and or reviewed. The objectives,
roles, responsibilities and obligations of the Liberia Revenue Authority Customs Department
and other entities functioning under its guidance are reviewed.
2.0.2 Development of the Liberia Revenue Authority
In September 2013, the Government of Liberia approved the Liberia Revenue Authority
(LRA) Act, which established the Liberia Revenue Authority (LRA) that comprises of the
Department of Customs, Internal Revenue, etc. The LRA Act replaced the Department of
Revenue under the Ministry of Finance and Development Planning, which included both the
Bureau of Internal Revenue and the Bureau of Customs and Excise.
2.0.2.1 The LRA Customs Department was established to administer Customs within the territorial
limit of Liberia especially where ports of entries are located. These entries are international
airport, ship docks and national land borders. These ports of entries are used by customs
administrative units for the performance of Customs operations. Predominantly, there are
six urban and eleven rural ports of entry in Liberia. Although there are other porous land
borders that are not mentioned officially.7
2.0.3 Mandate
2.0.3.1 The core mandate of the LRA is to administer and enforce Liberia’s revenue laws, including
the Liberia Revenue Code of 2000 as amended in 2011, and other related laws. The LRA
also has the mandate to assess, collects, audit, and account for all national revenues and
facilitates legitimate international trade through customs border management and
enforcement.
2.0.4 Policy and Legal Framework
2.0.4.1 The LRA replaced the Department of Revenue under the one-time Ministry of Finance,
which included both the Bureau of Internal Revenue and the Bureau of Customs and Excise,
as defined in Chapter 21 of the Executive Law of 1972. The LRA was established as a semi-
autonomous organ of the Executive Branch of the Government of Liberia in September
2013.
2.0.5 Vision and Mission of the LRA
2.0.5.1 The LRA vision aligns to that of the Government’s “To be a professional revenue
administrator adhering to international Standards and to serve as a model for revenue
collection and service delivery”. The LRA mission is “to professionally, fairly, transparently
7 LRA Revenue Performance report 2017-2018
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and effectively collect lawful revenues and to facilitate legitimate trade and social protection
for the people of Liberia”.
2.0.6 Stakeholders roles
2.0.6.1 The Customs department of the Liberia Revenue Authority has five major stakeholders as
listed. Each of these has coordinating roles that are explained below.
2.0.7 APM Terminal
2.0.7.1 APM Terminal is responsible for providing all marine services, including but not limited to
pilotage, towage, mooring and unmooring and any other marine services required by
vessels calling within a thirty (30) mile radius and performing all commercial container and
general cargo storage on behalf of third parties within the Freeport of Monrovia.
2.0.8 Bureau Veritas (BIVAC)
2.0.8.1 BIVAC is responsible for pre-shipment inspection/documentary destination inspection of
imports on behalf of customs and issues certificate to the importer.
2.0.9 National Port Authority
2.0.9.1 The National Port Authority (NPA) is responsible to manage, plan, and build all public ports
in Liberia and carry out the following services; Marine Services, Cargo & Handling,
Warehouses & Property, Shipping & Inspection. Additionally, it manages other seaports
(Buchanan, Greenville and Harper). However, the Government of Liberia and APM Terminal
has an agreement whereby APM Terminal manages marine service and cargo handling at
Freeport of Monrovia.
2.0.10 Custom Broker Union of Liberia
2.0.10.1 Responsible for declaration of shipment, they assist importers and exporters in meeting
requirements governing imports and exports. They act as professional agents for an
importer or exporter, prepare and submit all documents for clearing goods through the
Customs Department of the LRA.
2.0.11 Ministry of Commerce and Industry
2.0.11.1 The Ministry of Commerce is responsible for the promotion, development, regulation;
control, operation and expansion of commercial, industrial enterprises and activities in the
Republic of Liberia. The Ministry of Commerce and Industry exercises broad powers with
respect to protection of the public interest and the achievement of national goals through
the establishment and enforcement of standards for commodities and for trade. Also, the
Ministry of Commerce provides and administered under its purview services such as are
required by the public and government agencies.
2.0.12 Source of Funding to the Liberia Revenue Authority (LRA)
2.0.12.1 Section 27 of the LRA’s Act of 2013 states that the Liberia Revenue Authority shall be
funded by the amount appropriated by the National Legislature, Performance incentives
set by the Minister of Finance and appropriated by the legislature based on revenue actually
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collected each year in excess of the estimated revenue in the National Budget for the year
ended, grants, donations or subsidies which may lawfully accrue to the Authority. See
Table 2.
Table 2: Funding -LRA
US$ In millions EXTERNAL ASSISTANT TOTAL
FISCAL YEAR GOL GRANTS OTHER RECEIPTS
2016/17 18,558 161,6 512,8 19,232,504
2017/18 16,919 0.0 850,0 17,769,315
2018/19 16,814 17,5 324,5 17,156,758
TOTAL 52,291 179,1 1,687,5 54,158,577
Source: Approved National Budget of Liberia of each fiscal year
2.0.13 Customs Cargo Clearance Process map
2.0.13.1 The Revenue Code of Liberia 2000 as amended in 2011 and several international
instruments to which Liberia (LRA) has ascribed requires LRA to establish a framework for
Customs Cargo Clearance in compliance with national, regional and international
consultative engagement with the private sector and stakeholders in dealing with matters
of border procedures, regulations and customs requirements.
2.0.13.2 Below are required processes for customs cargo clearance at Seaports and Land borders in
Liberia. See Table 3.
Table 3- Steps for Caro Clearance
STEP SEA PORTS LAND BORDERS
1. Importer prints hard copy of the goods declarations, attaches
supporting documents and submits same for processing
Self-Declaration
2. Registration of declaration by declaration- is an official presentation
of document that lists and gives details of goods that are being
imported or exported. Example is invoices, bill of lading and
manifest. This is done via ASYCUDA through a registered
Brokerage firm, individual broker, importer/exporter or consignee.
Assessment is done on
declared cargo
3. Customs compliance officer’s complete verification of goods
declarations and prints assessment notice that is signed the Chief
Assessor. With the use of the ASYCUDA, no more printing and
signing of assessment notice. Importers will receive automatic
notice for payment.
Payment to cashier
4. Payment is made at the bank
Examination of cargo by
Custom and Borders agencies
5. Goods release order is signed and transmitted to the terminal
operator for the release of goods. Now that ASYCUDA is in place,
release orders are automatically sent to the terminal operator
after declarant completes payment of duties & taxes
Release of cargo with no
infraction (if there is
infractions additional payment
on goods that wasn’t declared
6. Exit is signed and goods are exited from the port. Exits of released
goods are automatically completed by the gate.
Security inspect document
before exit.
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STEP SEA PORTS LAND BORDERS
7. Goods are exited from the port – END OF PROCESS. Where the
importer is selected for inspection, Step 7 is skipped Not applicable
Source: LRA customs facts sheet
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3 CHAPTER THREE: FINDINGS
3.0 Findings
3.0.1 This chapter presents the audit findings as to whether customs cargo clearance is void of
delays; and, whether customs officials are monitoring procedures when importers clear
cargos to ensure that the procedure are carried out in a manner that support the
Sustainable Development Goal (SDGs) 17.10 on trade.
3.1 Overall
3.1.1 During the audit, the auditors asked whether there were delays; and, if Customs cargo
clearance processes were being monitored at seaports and land borders.
3.1.2 The audit revealed that while it is true that the LRA has developed its strategic and business
plans that require cargos to be released timely and for customs procedures to also be
simplified for importers at various ports of entries in Liberia, there are stay underlying issues
with customs cargo clearance at seaports and land borders despite measures taken by the
LRA as shown in the audit findings below.
3.2 Interagency involvement with Customs Cargo Clearance process
3.2.1 The Liberia revenue Authority is responsible to facilitate legitimate trade, customs clearance
through borders and social protection through policies and procedures that promote
efficiency, simplicity and should encourage taxpayer compliance in Liberia8.
3.2.2 The Customs Department of Liberia has not considered the provision in the WTO Trade
Facilitation Agreement (TFA)9 for expediting the movement, release and clearance of goods
in transit, time facilitation trade where it is possible. This provision is an important aspect
of customs; because, efficient and effective procedures in customs have a direct impact on
supply of goods on the Liberia markets and the economy generally.
3.2.3 The World Trade Organization also requires each member to align its processes in a manner
consistent with domestic law and legal system as well as international standards. Also, it is
required to publish information on the application of the movement, release, and clearance
of goods in order to enable trader and other interested parties to become acquainted with
them.10
3.2.4 We found that LRA’s Customs Department publishes on its website requirements as a
means for traders to be complaint with customs cargo clearance procedures - the
movement, release and clearance of goods. This website allows traders and other
interested parties to become acquainted with customs cargo clearance as stated below:
• Obtain the CRF (whether DI or PSI) from BIVAC at least 5 days prior to the arrival
of the goods.
8 LRA Act, 2013 Section 7.2.h p8 9 http://tfig.unece.org/contents/WTO_Agreement.htm 10 World Trade Organization Agreement Article 2.1.2
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• Make goods declaration immediately after the cargo manifest is registered with
Customs by the shipping agency.
• Pay your taxes and terminal handling charges immediately after receiving a duty
and tax assessment notice from Customs.
• Obtain a delivery order from the shipping agency immediately after the cargo is
discharged at the cargo terminal.
• Make sure to have a delivery truck available in time for immediate loading of cargo
by the terminal operator
3.2.5 The audit team reviewed the above procedures; yet, importers are stall encountering
challenges with customs procedures. At the seaport delay is the major challenge and at
land border challenges range from gate fees, clearing desk or facilitation fees.
For the land borders, we found out at Louguotou, Ganta, and Bo- Waterside borders that
importers are obligated to also visit the offices of Liberia Drugs Enforcement Agency,
Liberia Immigration Services, Major Crime Investigation Division and Ministry of Commerce
respectively for examination at the lands borders before taking hold of their goods; and,
client/importer that is bringing agriculture product, the importer has to go to the agriculture
office stationed at the borders for examination.
3.2.6 The Customs Department has deployed ASYCUDA World in major customs centers covering
85% of trade in Liberia.11 The United Nations Conference created ASYCUDA for Trade and
Development (UNCTAD) to reduce the cost of clearance, queuing time and clearance time
for clearing of cargos. It was also found that more than thirty percent (30%) of cargos
coming through the port have to still go through physical examination even if BIVAC
compliant; when the percentage should be twenty percent (20%) as the annual target for
cargos to be physically examined as indicated in the 2016 annual report of LRA for customs.
3.2.7 The graphs demonstrate that for the period audited, the average physical inspection is at
34% as compared to the targeted 20% see figure 1. In addition, the combined
documentary examination and physical inspections when totaled is more than seventy-five
(75%) of cargos shipped through the Freeport of Monrovia. The estimated calculated hours
for borders compliance inclusive of documentary and physical inspections at Liberia ports
of entry is 217 hours which equals to (217hrs divided by 24hrs = 9.0) 9 days published by
World Bank group, Doing Business 2019 Report. Below are the factors that made up the 9
days See Figure 2:
11 https://www.afdb.org/fileadmin/uploads/afdb/Documents/Project-and-Operations/Liberia
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Figure 1: SELECTIVITY LANES FOR CARGOS CLEARING THROUGH CUSTOMS FOR AUDIT PERIOD
Source: LRA Annual Report 2016-2019
Figure 2: Steps in calculating the 9 days
DOCUMENTARY COMPLIANCE BORDERS COMPLIANCE
Obtaining, preparing and submitting documents during transport,
clearance, inspections and port or border handling in origin
economy.
Customs clearance and inspections
Obtaining, preparing and submitting documents required by
destination economy and any transit economies
Inspections by other agencies (if
applied to more than 20% of
shipments)
Covers all documents required by law and in practice, including
electronic submissions of information
Handling and inspections that take
place at the economy’s port or border
Table prepared by: GAC
3.2.8 We reviewed the customs procedures at Bo-waterside, Ganta, Lougatuo, Butuo, Jowah
rural land borders and the Freeport of Monrovia. At these borders we found that importers
are going through an inefficient clearance procedure at those ports of entry. At all the ports
of entry, customs brokers and importers have to go through documentary the physical
examination processes.
Management’s (LRA) Response 3.2.9 We are not sure if this is a finding or a recommendation. However, we are happy to add
that a FACT Sheet, FAQ, all customs procedures, laws and regulations have been published
on LRA website for ease of public reference. The FACT Sheet specifically informs importers
of all the necessary pre-requisites, prior to arrival of cargo at customs ports, which enable
clearance in time without incurring additional cost. This includes the legal requirement for
shipping lines manifests to be lodged to the system (ASYCUDA) at least 72 hours prior to
the arrival of vessels, submission of customs declaration and payment by the importer in
advance of arrival of cargo.
Comments
3.2.10 Government Institutions involved with Custom Cargo Clearance, such as LDEA, MOA, etc.
should coordinate the examination process to reduce the bureaucracy in clearance cargos
from ports and land boarders for efficiency.
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3.3 Complex payment procedures for customs duties
3.3.1 Payment for goods imported through the Freeport of Monrovia can only be done at the
Central Bank (CBL) collection window in the Customs Business Office at the Freeport of
Monrovia. The importer must procure a manager’s check from a commercial bank for five
united stated dollars (USD$5), makes payment to Central Bank window, received a treasury
receipt and then returns to the CBOs with the treasury receipt to continue the process. If,
it is determined that additional payment is due (for example, correction of the earlier
estimates duty), the importer must begin the whole payment process for the difference.
Payment for all other port costs is made at other Central Bank collection windows or through
Government of Liberia transitory accounts at commercial banks. Importers has to go
through the described processes for customs payment before beginning APM Terminals
and NPA handling charges payment processes.
3.3.2 Payment of duties and taxes less than or up to US$250 do not require manager’s check
and may be paid in cash to the Customs cashier, a transitory account with a commercial
bank or a Central Bank collection window.
3.3.3 During our site visit at the Freeport of Liberia, we noticed that traders and importers who
trade in Liberian dollars which is the legal tender in Liberia were experiencing difficulties in
exchanging the Liberian dollars to United States Dollars at a very high rate to clear their
cargo.
Management’s (LRA) Response
3.3.4 In the absence of electronic payments, payment through a manager’s check remains the
most secured way of protecting Government revenue. Shortages that may require re-doing
a manager’s check are abnormal because final bills are obtained before payment. Hence,
the amount on the manager’s check should always equal the billed amount. Anything on
the contrary is in effect negligence on the part of the importer or his/her bank.
Notwithstanding, there is an on-going process at the LRA to incorporate electronic
payments which will eliminate the need for the physical presence of a commercial or Central
Bank. This may require funding and time for automation and integration of systems.
Audit Comments
3.3.5 The use of electronic payments will be efficient; however, LRA’s Customs Department
should coordinate payments so that LRA, APM Terminal and NPA processed in one location
for effectiveness.
3.3.6 Additionally, introduce electronic payment process for imports to have smooth payment
process.
3.4 Unclear Customs Cargo Clearance procedures at land borders
3.4.1 Chapter 9.1 of the Kyoto Convention states that customs shall ensure that all relevant
information of general application pertaining to customs is readily available to any
interested person.
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3.4.2 Chapter 9.2 of the Kyoto Convention states that information that has been made available
must be amended due to changes in customs law, administrative arrangements or
requirements, the customs shall make the revised information readily available sufficiently
in advance of the entry into force of the changes to enable persons to take account of
them, unless advance notice is precluded.
3.4.3 LRA customs department prescribed the following below procedures for clearance of cargo
at land borders:
• Self-Declaration of cargo to customs office
• Assessment is done by the Assessor
• Consignee proceed to the cashier to make payment
• Examination of cargo for verification (Done with customs and all borders agencies
assigned to the borders)
• Exit of cargo form port if there is no infraction as to what was declared
3.4.4 Moreover, LRA’s Customs Department is also responsible to develop and maintain
standards, guidelines and apply modern techniques and technology to facilitate and ensure
simplification and harmonization of procedures.12 Customs is referred to as a gatekeeper of
a nation, procedures that outsider (importers/traders) goes through before bringing cargo
into Liberia is crucial for international and economic development.
3.4.5 From questionnaire presented to consignees Customs Brokers at land borders visited,
customs procedures are different from the above-mentioned procedures published by the
Customs Department for cargo clearance. Some of the customs procedures that are
different from the official document published are noted below and were all common to
Bo-waterside, Lougatou and Ganta which are major borders entry point to Liberia:
• Separate examination by all of the agencies (Liberia Drugs Enforcement Agency,
Liberia National Police, Ministry of Commerce and Ministry of Agriculture) that are
assigned at these borders.
• Payment of 4% on goods, if Cost Insurance and Freight (CIF) is more than
US$110.00 and if the consignee does not have business registration. Whereas
according to the Ministry of Commerce & Industry Guide on Operating Business in
Liberia a Presumptive Tax of four percent (4%) is due no later than 15 days after
each quarter. This is applicable to Small business whose gross annual sales are
$LD 200,000.00 – LD3,000,000.0013
• Paying the amount of US$20.00 for ECOWAS brown card when bringing vehicle
into the country. The main objective of the ECOWAS Brown Card scheme is to
guarantee to the victims of road accident a prompt and fair compensation of
damages caused by nonresident motorist from ECOWAS member states visiting
their territory14
12 Corporate business plan 2018/19 LRA management framework 1.3 13 http://www.moci.gov.lr/doc/MoCI.BusinessHandbook.013017 page 12 14 https://www.ecowas.int/specialized-agencies/ecowas-brown-card/
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3.4.6 Custom officials’ failure to coordinate the activities of other agency of government at one
location in adherence to the policy and standard of clearance of goods at land borders
makes it difficult to calculate and pre-determined customs duties and other charges that
might be levied on a particular import based on the procedures that an importer/trader
have seen published which might leads to delay in clearing his/her goods.
Questionnaires with answers by Consignees and Customs Brokers
No Questions Position Answers
1.
What are the processes involved to
cleared cargo as a broker at the CBO?
Consignee
I first go to Appraisal which is the
Assessor for assessment, later the
Cashier and pay in cash. Later Internal
Revenue and pay 4% if your goods is
worth more than 110USD and not
register with the Liberia Business
Registry, you go to Commerce Ministry.
Consignee I go to the Examiner to check my goods
and from there I go to the Assessor who
raise my bill and payment. I later go to
Commerce Office and Liberia National
Police (Major Crime Investigation Unit)
before I can take my goods.
Consignee The first person I have to see is the
Examiner, from there the Assessor. After
that cashier. I also go to the Commerce
Ministry staff for 4% and from there the
Major Crime Investigation Unit and the
Liberia Drug Enforcement Officer before
taking my goods.
Broker Bill of lading, Will bill and parking list
Broker Bill of Lading, waybill and parking list
Customs Broker
The consignee presents parking list or
invoice to Assessor than you pay and
finally go to examiner for examination
you pay 20USD to ECOWAS for one used
car.
Management’s (LRA) Response
3.4.7 All customs procedures, laws, regulations, executive orders, FAQs and FACT Sheet have
been published on LRA website for public access. Considering the poor internet
infrastructure at rural land borders and the limitation of rural land border importers to
access internet publications, the LRA will endeavor to publish clearance procedures at major
land borders on bill boards once funding is available.
3.4.8 Interference by other agencies in customs examination is a problem we do recognize and
fully note the auditor’s observation. Notwithstanding, in the framework of coordinated
border management, the conduct of joint examination has been instructed to border offices
where other border agencies do have a particular interest in targeted consignments.
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3.4.9 The payment of 4% CIF on imported goods is a domestic tax paid only by non-registered
importers engaged in business activity through importation and sales. This is an alternative
means of capturing tax evaders through their cross-border transactions.
3.4.10 On the issue of US$20 ECOWAS Brown Card (EBC), Customs will require a Government
regulation or instrument of national authorization for the enforcement of such collection.
Audit Comment
3.4.11 The Liberia Revenue Authority should formulate standard procedures for customs cargo
clearance at Land borders and seaports; and, customs officials and Brokers assigned at
land borders and seaports should follow the standards customs cargo clearance procedures
set forth. In addition, the LRA should monitor every activity on cargo clearance to ensure
each port of entry is implementing the procedures as designed.
3.5 Lack of automated system at major Land borders
3.5.1 The LRA Customs Department objective 4.1 is to deploy and operationalize modern revenue
administration technology to improve compliance and effectiveness. Furthermore, section
4.1.6 states that rural and urban field offices will be reliably connected to core business
system through mobile connection points and other available management information
systems infrastructure.
3.5.2 Additionally, objective 6.4 of the Customs Department (LRA) business plan of 2018/19 is
to automate CBOs15. World Customs Organization version III (June 2018) on the guidelines
for the speedy Release of consignments by Customs encourages that all necessary
information relating to cargos to be submitted electronically to customs administrations and
all consignments assessed as low risk should be released either immediately upon arrival
or after a specified time after arrival of the goods.
3.5.3 The Audit team observed during the field visit to 5 of the 17 land borders (Bo-water side,
Ganta, Lougatuo, Jorwah and Butuo) there is no automated system (ASYCUDA) to
determine bill or a price list for custom payment. As a result, customs cargo clearance
procedures are done manually which could lead to declaration been understated by
consignees to not paid the accurate revenue to government and further delay in the cargo
clearance process.
Management’s (LRA) Response
3.5.4 The LRA takes note of the auditor’s observation and do acknowledge that customs
procedures at land borders are still manual due to funding constraint to automate land
border offices and sustain the system (ASYCUDA). While efforts are underway for donor
funding to roll the system out to land borders, there are still manual controls in place to
mitigate revenue fraud at land borders.
15 LRA corporate strategy plan of 2016-20121
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Audit Comment
3.5.5 The employment of automated system and in particular ASYCUDA at major ports of entry
will provide uniformity in determining cargo clearance billing, reduce transaction cost,
clearance time, and mitigate manual negotiation which could lead to bribery.
3.5.6 Further, the installation of solar energy power system at Customs Business Office and/or
the repair of the existing solar power system could support ASYCUDA.
3.6 Poor security for Cargo at Land borders
3.6.1 Section 6.1 of LRA Act states that the LRA is established to administered enforce, the
revenue laws in accordance with the Code and other related laws. Further the LRA has
responsibility to account for all national revenues and to facilitate legitimate international
trade and customs border management – enforcement. According to the LRA website
(revenue.lra.gov.lr), border security is one of the Customs Department core functions.
3.6.2 The LRA’s responsibility per Section 7. (h) of the LRA Act is to, “facilitate legitimate trade,
customs clearance through borders and social protection through policy and procedures
that promote efficiency, simplified and enhance taxpayer’s compliance”.
3.6.3 According to Sections 14187 (1) and 14187(d) of the Revenue code of Liberia Act of 2000
Storage of Goods in Warehouses. The warehouse proprietor shall stow every container or
lot of warehoused goods so as to facilitate easy access thereto and identification thereof.
During field verifications at all the five land borders visited, it was observed that Customs
warehouses which should be a secured place and approved by the Minister of Finance with
the provision outlined in the Revenue Code, were seen opened and not fully secured.
Additionally, at Bo-waterside CBO where used vehicles are parked, there is no fence to
protect vehicles from potential theft. Even at Lougatuo CBO you can see from pictorial
evidence that cargo is spread out on the ground without consideration for potential rain d
damage of the cargo. See below for detail pictorials.
GAC PHOTO: 1: Bo-waterside Customs Business Office.
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GAC PHOTO: 2: Lougutuo Customs Business Office and crossing point
GAC PHOTO: 3: Buutuo Customs Business Office and crossing point
GAC PHOTO: 4
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GAC PHOTO: 5: Jorwah Customs Business Office warehouse
Management’s (LRA) Response
3.6.4 In terms of border security and in light of its statutory mandate, customs is fully engaged
in border security in coordination with other border security agencies; and takes full
responsibility to lead on supply chain security. On the other hand, funding is required to
construct border infrastructure for the security of goods and safety of officers.
Audit Comments
3.6.5 Securing cargo is a provision in both the LRA Act and Revenue code; and, the verification
exercise shows that the LRA is not in compliance when it comes to the protection of cargos
in its possession at land borders.
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4 CHARPTER 4: CONCLUSION
4.0 Conclusion
4.0.1 This Chapter presents the conclusion of the findings against the key audit objectives as to
whether cargo clearance at Liberia seaports and land borders are timely, void of delays and
if the Clarence processes are monitored.
4.0.2 The audit concludes that measures put in place by the Liberia Revenue Authority is not
effective to curtail the difficulties involved in the procedure of cargo clearance at land
borders and ports.
4.0.3 Customs brokers at Land borders are not fully knowledgeable about the procedures of
cargo clearance. This is evidenced by the overall results of questionnaire completed by
brokers.
4.0.4 The Customs department at the Liberia Revenue Authority has not fully ensured that cargo
clearance procedures at land borders are clear and harmonized across every land border
in Liberia.
4.0.5 Customs cargo clearance formalities are not coordinated between stakeholders of the LRA.
This is evidenced by customs authorities’ reliance on cargo selectivity module in ASYCUDA,
while other government agencies deployed at Freeport do not have equivalent systems. On
the other hand, customs brokers and consignees indicated in their questionnaire that they
have to pass through other separate offices to process the clearance of cargo at land
borders.
4.0.6 Liberia Revenue Authority Custom Department at major land borders lacks the automated
system (ASYCUDA) for customs Clarence. As a result, there are human interventions,
manual determination of the duty which could lead to understating custom duties, fraud;
under-reporting of taxes and delay in clearing of goods and increase in transaction cost.
4.0.7 Custom officials assigned at land borders do not protect Cargo, henceforth, cargos are
placed in an open environment without fence for protection and warehouses are not in
good condition to store cargos.
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5 CHAPTER FIVE: RECOMMENDATIONS
5.0 Recommendations
The Customs Department of LRA has the legal backing and mechanism to be a robust
customs administration in Liberia. The audit findings as described in Chapter 3 are areas
that should be addressed to realize effectiveness and efficiency in customs cargo clearance
at seaports and land borders. Overall, the LRA Customs Department should review findings
herein that relates delays, training, timeliness, cargo security, proper coordination between
stakeholders, and look at ways to harmonizing customs cargo clearance procedures at the
various ports of entry in Liberia. Further, they should establish quarterly reviews and
motoring of the various customs points of entry to ensure that various procedures and
processes are uniformly implemented.
5.1 Interagency involvement with Customs Cargo Clearance process
5.1.1 The Management of the Liberia Revenue Authority should ensure that the customs cargo
clearance procedures are simplified to enable consignees to clear their goods timely and
efficiently. The LRA’s Customs Department should ensure that the payment process of
customs duties is done in one location.
5.1.2 We recommend that various Government agencies who have related functions in cargo
clearance should coordinate and participate in the examination process, if necessary when
cargo arrives at a port or borders. Further as customs officials are the lead in cargo
Clarence, a memorandum of understanding can be entered to place reliance on the
Customs.
5.1.3 Documents requires by various agency should be reviewed and synchronized so that
brokers and importers are filling out a comprehensive document that can be shared for
cargo clearance processes.
5.1.4 Furthermore, custom official should be trained and to play a lead role in the inspection and
examination of cargo.
5.1.5 Liberia Revenue Authority should consider installing cargo/goods scanning camera system
similar to the luggage scan at international airports. The scan will be analyzed by Customs
and other government agencies to check whether the content match the cargo description
and whether illegal cargo can will be found. This will reduce physical inspection and
clearance time.
5.2 Unclear Customs Cargo Clearance procedures at land borders
5.2.1 LRA should ensure that customs officials assigned at land borders follow the standard
customs cargo clearance procedures set forth; and, every cargo clearance activity should
be monitored for compliance with the standard set.
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5.3 Inadequate training for Customs Broker
5.3.1 LRA Customs Department should ensure that every Custom Business office undertakes
quarterly or bi-annual refreshment training on custom clearance procedures.
5.4 Lack of automated system at major Land borders visited
5.4.1 LRA Customs Department should ensure that automated system (ASYCUDA) is installed at
major ports for uniformity and in determining cargo clearance billing, reduce transaction
cost, clearance time, and mitigate manual negotiation which could lead to bribery.
5.4.2 Install solar energy power system at Customs Business Office and repair existing solar
power system to support the ASYCUDA.
5.5 Poor security for Cargo at Land borders
5.5.1 LRA Customs Department should construct fence and build warehouses to protect cargo at
land ports.
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APPENDIXES
Appendix 1: Audit Criteria
NO. Audit questions Audit Criteria Source of Criteria
1. To what extent cargos/goods at land
borders and seaports are cleared within
the required time stipulated by Customs?
Strategy 1.2 of LRA Corporate
Strategic Plan 2016/2017 -
2020/2021 require LRA to increase
effectiveness in the administration
of tax and customs operations.
LRA Corporate Strategic
Plan 2016/2017 -
2020/2021
2. Does the Customs Business Office (CBOs)
ensures cargo clearance processes at land
borders and seaports are simplified for
customs Brokers?
LRA acts 2013 section 7.2 (h)
requires LRA to facilitate legitimate
trade, custom clearance through
borders that promotes efficiency,
simplify and enhance taxpayer
compliance
LRA Act of 2013
3. Does the ASYCUDA system influence
timely clearing of cargo at seaports?
LRA strategy plan of 2016/2017 -
2020/2021 strategy 4.1.1 requires
LRA to deploy and operationalize
modern revenue administration
technology to improve compliance
and effectiveness
LRA Corporate Strategic
Plan 2016/2017 -
2020/2021
4.
Does Customs Department ensure staffs
and necessary stakeholders are trained to
handle cargo clearance?
Strategy 3.2.4 requires LRA to
implement training plan with
emphasis on technical training and
certification
LRA Corporate Strategic
Plan 2016/2017 -
2020/2021
Article 12.1.2 of WTO requires LRA
to cooperate in technical guidance
or assistant and support for
capacity building of staff for the
purpose of administering
compliance and enhancing
effectiveness
WTO Agreement
LRA acts of 2013 section 1 require
LRA to educate taxpayer in order to
facilitate tax and custom
compliance.
LRA 2013 Act
5. To what extent Customs Department
monitors to ensure customs operations are
in line with cargo clearance procedures?
LRA 2013 Acts Section 21.1(e). LRA
should ensure the effective
deployment and utilization of staff
to achieve maximum operational
results
LRA Act 2013
LRA strategy plan of 2016/2017 -
2020/2021 strategy 3.3 requires
LRA to adhere satisfactorily to local
and international performance
benchmarks
LRA strategy plan of
2016/2017 -2020/2021
6. To what extent monitoring of Customs
Business Office (CBOs) is done to ensure a
free movement of cargos?
Revenue Code of 2011 section
1701 (2) require commissioner
(Deputy Minister) to monitor the
movement of goods, and is
empowered in consultation with the
Ministry of Commerce and Industry,
to take appropriate measures to
ensure the free
Liberia Revenue code 2011
Performance Audit Report
Customs Cargo Clearance Processes at Liberia Seaport and Land Borders
For fiscal years 2016/2017 through 2018/2019
23
Appendix 2: List of Interviewee
Position of Interviewee Institution Purpose of Interview
Chief Accountant APM Terminal To know the responsibility of APM
Terminal in the cargo clearance
process.
General Manager CMA-CGM Shipping line To understand the role of shipping
lines in the cargo clearance process
at seaports.
President Broker Union To know the responsibility of the
Brokers Union in cargo clearance.
Broker Ganta Border Broker To have a clear understanding of the
role brokers play in cargo clearance
at the Ganta border.
Consignee Lougatuo Border To have an understanding about
how the cargo clearance process at
the Lougatou border are carryout.
Asst. Commissioner for
Ports Operation
Customs Department (LRA) To have an overview of port
operations and what are the factors
that affect cargo clearance
processes in Liberia.
Manager Centralized Assessment Unit (CAU) To have a clear understanding about
the automated system at the various
ports and borders in Liberia.
Chief Collector Ganta CBOs To have an understanding about
how cargo clearance process at the
Ganta border are carryout.
Chief Collector Jorwah CBOs To have an understanding about
how cargo clearance process at
Jorwah border are carryout.
Chief Examiner Lougatuo CBOs To have an understanding about
how cargo clearance process at
Lougatou border are carryout.
Chief Collector Bo-waterside CBOs To have an understanding about
how cargo clearance process at the
Bo-waterside border are carryout.
Chief Examiner Butuo CBOs To have an understanding about
how cargo clearance processes at
Butuo border are carryout.
Performance Audit Report
Customs Cargo Clearance Processes at Liberia Seaport and Land Borders
For fiscal years 2016/2017 through 2018/2019
24
Appendix 3: List of documents Reviewed
NO. Institution Documents Information needed from the
document
1. Liberia Revenue
Authority Act
Liberia Revenue Authority Act 2013 Roles and responsibility of the
Customs department.
Annual strategy plan
Liberia Revenue Code (Custom laws)
as amended 2011
Liberia National Trade Policy of 2014-
2019
National Budget Funding to the LRA and LRA
contribution to the national budget
2. World Trade
Organization
WTO agreement Roles and responsibility of the
Customs department.
Appendix 4: Site visited
Location Purpose
Bo-Water side To verify written customs procedures against practice at carry out at land borders
Ganta To verify written customs procedures against practice at carry out at land borders
Lougatuo To verify written customs procedures against practice at carry out at land borders
Butuo To verify written customs procedures against practice at carry out at land borders
Jorwah To verify written customs procedure against practice at carry out at land borders