Check-list of Issues

Botswana

The following communication, dated 14 May 2025, is being circulated at the request of the delegation of Botswana.

_______________

1._        Questions concerning Article 1:

(a)   Sales between related persons:

(i)  Are sales between related persons subject to special provisions?

Yes, provisions under Section 326(1) (d) and (2)-(5) of the Customs Act are applied.

(ii)    Is the fact of intercompany prices prima facie considered as grounds for regarding the respective prices as being influenced?

No, provisions under Section 326(4) of the Customs Act are applied.

(iii)   What is the provision for giving the communication of the afore-mentioned grounds in writing if the importer so requests? (Article 1.2(a))

Section 326(4)(d) of the Customs Act provides that if the importer so requests, a communication of the grounds shall be provided in writing.

(iv) How has Article 1.2(b) been implemented?

a)  Article 1.2(b) has been implemented at section 326(5) of the Customs Act to substantiate the transaction value is applied on sales between related parties and intercompany sales. However, considerations have to be made whether the relationship did not influence the selling price. The importer should justify in writing, why the selling price differs from other unrelated buyers from the same suppliers.

b)  In applying this Article, section 326(5) of the Customs Act provides that the transaction value of identical goods in a sale at the same commercial level and in substantially the same quantity as the goods being valued shall be used to determine the customs value. Where no such sale is found, the transaction value of identical goods sold at a different commercial level and/or in different quantities, adjusted to take account of differences attributable to commercial level and/or to quantity, shall be used, provided that such adjustments can be made on the basis of demonstrated evidence which clearly establishes the reasonableness and accuracy of the adjustment, whether the adjustment leads to an increase or a decrease in the value.

(b)   Price of lost or damaged goods:

         Are there any special provisions or practical arrangements concerning the valuation of lost or damaged goods?

Sections 79, 152, 153, 156, 162 and 191 of the Customs Act provides for the treatment of lost or damaged goods.

2._        How has the provision of Article 4 to allow the importer an option to reverse the order of application of Articles 5 and 6 been implemented?

Section 329(2) of the Customs Act provides that at the request of an importer the order of application of sections 330 and 331 shall be reversed.

3._        How has Article 5.2 been implemented?

Section 330(3) of the Customs Act provides that, if neither imported goods, identical or similar imported goods are sold in Botswana in the condition as imported, if the importer so requests, Revenue Service shall base the customs value on the unit price at which the imported goods, after further processing, are sold in the greatest aggregate quantity to persons in the country or territory of importation who are not related to the persons from whom they buy the goods, due allowance being made for the value added by processing and deductions provided under subsection (1)(a).

4._        How has Article 6.2 been implemented?

a)   Section 331(3) of the Customs Act provides that a person not resident in Botswana shall not be compelled to produce for examination, or to allow access to, any account or other record for the purposes of determining the computed value of imported goods.

b)   Section 331(4) of the Customs Act provides that notwithstanding subsection (3), information supplied by the producer of goods for the purposes of determining the value of imported goods may be verified in another country by the authorities of Botswana with the agreement of the producer.

5._        Questions concerning Article 7:

(a)    What provisions have been made for making value determinations pursuant to Article 7?

Section 332 of the Customs Act provides that if the Revenue Service cannot determine the customs value of imported goods under the provisions of sections 326 to 331, the customs value shall be determined using reasonable means consistent with the provisions of the WTO Agreement on Customs Valuation and of Article VII of the General Agreement on Tariffs and Trade 1994, and on the basis of any relevant data available in Botswana.

(b)    What is the provision for informing the importer of the customs value determined under Article 7?

Section 332(3) of the Customs Act allows that upon a request for information on determination of the customs value of imported goods by an importer, he or she shall be informed within 30 days, in writing, by the Revenue Service   the customs value determined and the method used to determine such value.

(c)    Are the prohibitions found in Article 7.2 delineated?

The prohibitions found in Article 7.2 are provided in section 333(2) of the Customs Act.

6._        How have the options found in Article 8.2 been handled? In the case of f.o.b. application, are ex-factory prices also accepted?

The provision captured under section 333(2) of Customs Act are applied.

7._        Where is the rate of exchange published, as required by Article 9.1?

Section 338 of the Customs Act provides that, the rate of exchange is collected from the reserve bank, published weekly and input in the Customs Management System every Monday of each week for availability to the users. This is for the purpose of foreign currency conversion to Pula.

8._        What steps have been taken to ensure confidentiality, as required by Article 10?

Section 23 of the Customs Act is the general confidentiality clause.

9._        Questions Concerning Article 11:

(a)   What rights of appeal are open to the importer or any other person?

Section 380 is the general provision providing for a person aggrieved by a decision of the Revenue Service to the appeal.

(b)   How is he to be informed of his right to further appeal?

Sec 380(3) of the Customs Act provides for notice to the importer in writing to inform him to appeal.

10._     Provide information on the publication, as required by Article 12, of:

(a)

(i)  The relevant national laws;

Customs Act Cap.50:02, Excise Duty Act Cap.50:01 and Value Added Tax Act Cap.50:01

(ii) The regulations concerning the application of the Agreement;

The Customs Regulations 2025 are in draft form and awaiting stakeholder engagement and finalisation.

(iii)   The judicial decision and administrative rulings of general application relating to the Agreement;

Section 384 of the Customs Act. The Minister may make regulations prescribing anything under this Act which is to be prescribed or which is necessary for the better carrying out of the objects and purposes of this Act, or to give force and effect to its provisions.

Judicial decisions are primarily found in the Botswana Law Reports, accessible to the public through the Government bookshop or electronically via Juta Law, while regulations for the publication of administrative rulings are currently under development.

(iv)   General or specific laws being referred to in the rules of implementation or application.

Implementation of these provisions shall be consistent with the WTO Agreement on Customs Valuation Art. VII of the GATT 1994, e.g., Section 332 of the Customs Act.

(b)   Is the publication of further rules anticipated? Which topics would they cover?

The draft Customs Regulations 2025 shall be published in the Government Gazette once the drafting process is completed.

Should there be subsequent amendments to the Regulations they will be published by in the Government Gazette.

All customs procedure and prescribed forms and schedules as these have been outstanding since 2018.

11._     Questions concerning Article 13:

(a)    How is the obligation of Article 13 (last sentence) being dealt with in the respective legislation?

Section 340 of the Customs Act provides that; "An importer of goods may request the Revenue Service to release the goods if he or she furnishes a guarantee covering the duties and taxes that may become payable, if, in the course of determining the customs value, tariff classification or origin of the imported goods, it becomes necessary to delay the final determination of the customs value, tariff classification or origin of such goods".

(b)    Have additional explanations been laid down?

They are to be incorporated in the draft Customs Regulations.

12._     Questions concerning Article 16:

(a)    Does the respective national legislation contain a provision requiring customs authorities to give an explanation in writing as to how the customs value was determined?

No, the respective national legislation does not contain a provision requiring customs authorities to provide a written explanation of how the customs value was determined.

However, section 326(4)(d)(4) of the Customs Act provides that in determining whether the transaction value is acceptable for the purposes of subsection (1), the fact that the buyer and the seller are related shall not in itself be grounds for regarding the transaction value as unacceptable:

Provided that – (d) the importer so requests, the communication of the grounds shall be in writing.

(b)    Are there any further regulations concerning an above-mentioned request?

Yes, the draft Customs Regulations 2025 will provide further clarification.

13._     How have the Interpretative Notes of the Agreement been included?

The inclusion of the Interpretative Notes has been proposed in the draft Customs (Amendment) Bill 2025 at clause 325A.

14._     How have the provisions of the Decision on the Treatment of Interest Charges in the Customs Value of Imported Goods been implemented?

The draft Customs (Amendment) Bill 2025 includes a provision which will provide for these principle "… customs value of goods shall be determined in accordance with the WTO Customs Valuation Agreement, the Interpretative Notes thereto, the Advisory Opinions, Commentaries and Explanatory Notes, Case Studies …".

15._     For those countries applying paragraph 2 of the Decision on the Valuation of Carrier Media Bearing Software for Data Processing Equipment, how have the provisions of this paragraph been implemented?

The draft Customs (Amendment) Bill 2025 includes a provision which will provide for these principle "… customs value of goods shall be determined in accordance with the WTO Customs Valuation Agreement, the Interpretative Notes thereto, the Advisory Opinions, Commentaries and Explanatory Notes, Case Studies …".

__________