Traditionally, the clearing agent is the go-between for importers, exporters and the customs administration. Their role has been that of paper and bribe pushers, hence earning them a notorious reputation as an unscrupulous border or port operatives.
Role of clearing and forwarding agents
Their role as outlined by the Kenya Revenue Authority (KRA) is to carry out clearance procedures on behalf of a firm or an individual. According to the KRA, there are 868 licensed clearing agents. According to (Kifwa), out of 1,100 firms that used to operate pre-Covid-19, now only about 400 remain active.
KRA has done a good job in weeding out briefcase operatives through a strict vetting process. However, KRA is only one of many State agencies involved in the cargo clearance process, including Kenya Airports Authority, Kenya Ports Authority, Kenya Bureau of Standards, Kenya Railways Corporation and KenTrade, among many others.
The role of clearing agents should be recognised by all agencies involved in cargo clearance.
Under the current operating environment, especially post-Covid 19, the clearance procedure has a wider scope than the traditional customs clearance. It involves port or border cargo movement, health and quality checks amongst a host of other activities.
Kifwa estimates that up to 80 per cent of import entries are referred to Customs Valuation and Tariff Office for scrutiny, leaving clearing agents to resort to bribes and cargo theft.
When it comes to the licensing of clearing agents, the entire process is dictated and controlled by KRA. The role of KRA should just be part of the due diligence process such as clearance by State agencies.
Kifwa is one of the six members of the Federation of East African Freight Forwarders Associations, which has over 2,500 member firms. Others are Burundi, Rwanda, Tanzania, Uganda and Zanzibar.
It has a capacity-building initiative, for clearing agents, in collaboration with the Kenya School of Revenue Administration, which offers courses for clearing agents.
At the local level, Kifwa should establish its own autonomous regulatory framework that includes training and capacity building, certification and disciplinary mechanisms without being subjected to oversight by the Customs Administration.
It should work with Kenya Accountants and Secretaries National Examinations Board and Kenya National Examinations Council to develop a professional recognised curriculum for clearing agents.
There needs to be a convergence of policy and practice of clearing agents to ensure the successful implementation of the trade facilitation initiatives under the African Continental Free Trade Area. Kifwa should take the lead in making FEAFFA a strong regional body and link it with other regional clearing agents’ institutions to professionalise it.
The writer is a trade consultant