APTTA goods insurance guarantee: applicability of existing SROs, notifications questioned

Model Custom Collectorate (MCC) Port Qasim has raised a question whether the existing customs duty related statutory regulatory orders (SROs) and notifications would be applicable for calculation of duties and taxes for securing insurance guarantee against Afghan transit trade goods to be cleared under the Afghanistan-Pakistan Transit Trade Rules-2011.
In this connection, Model Customs Collectorate (MCC) Port Qasim has sought clarification from the FBR. Sources told Business Recorder on Tuesday that the Collector MCC Port Qasim has asked the FBR to give guidelines on the implementation of the APTTA rules 2011.
The Collector said that while processing first Goods Declaration (GD) filed under the APTTA Rules 2001, a question has arisen regarding the amount of duties and taxes to be secured against insurance guarantee. While the subject rules are silent, there are divergent views on the issue among the trade and field formations.
This Collectorate opines that since the objective of introducing insurance guarantee against Afghan Transit Consignment is to secure the amount of duties and taxes otherwise leviable on the import of such goods in Pakistan, therefore, the amount of insurance guarantee shall be calculated by applying all applicable SROs/notifications insurance guarantee shall be calculated by applying all applicable SROs/notifications (excluding conditional exemptions) which are applicable on imports meant for Pakistan, Collector MCC Port Qasim added.
Under the APTTA Rules, the Afghan based importer of goods or his authorised Customs clearing agents, brokers or transport operator in Pakistan shall furnish Customs security in the form of insurance guarantee from an insurance company of repute, acceptable to Customs, in the prescribed form which shall be valid for at least one year and shall be en-cashable in Pakistan, for ensuring the fulfilment of any obligation arising out of Customs transit operation between Pakistan and Afghanistan.
The licensing authority (Collector of Customs (Appraisement), Karachi or any authority approved by the Board) shall require the transport operator to deposit a revolving insurance guarantee in the prescribed form amounting to Rs 5 million from an insurance company of repute covering all types of risks detrimental to the government revenue involved in the transit goods along with general undertaking in the prescribed form binding them to transit the goods safely and securely as per this procedure. The insurance guarantee shall be issued by an insurance company having paid up capital of not less than rupees one hundred million and which is duly registered with the Controller of Insurance, Ministry of Commerce, APTTA Rules added.