Smuggling, parallel trade of food items: Customs taking steps towards enforcement of SRO

ISLAMABAD: The Customs authorities are taking appropriate steps for the enforcement of SRO237(I)/2019 to check smuggling and curb the menace of parallel trade of non-duty paid imported food items at the retail level in Pakistan.

Sources told Business Recorder here on Tuesday that the Federal Board of Revenue (FBR) is coordinating with the Commerce Ministry on the implementation of the said notification. The said statuary regulatory order was issued to curtail the smuggled and parallel trade issued SRO 237 dated 19th February (2019 amendment to Import Policy Order, 2016). "Strict implementation of the Import Policy Order on the import of food items would be ensured by the customs at ports," they added.

The sources said that it is a major initiative of the Ministry of Commerce to curb the menace of parallel trade and reassuring for the food industry in the country.

All the business community got very pleased with the order which showed the government seriousness in maintaining the safety of the health of their population, and providing a level-playing field to the businesses.

However, situation on ground is challenging as big importers/distributors and retailers are continuing to involve in illegal practices by not complying with Statuary Regulatory Order 237 dated 19th February 2019 on amendment to Import Policy Order, 2016.

Under the SRO 237(1)/ 2019, all food products imported from abroad should have 66 percent of shelf life at the time of import.

The name of the ingredient and details of the food product should be printed on the pack in Urdu and English.

The Halal logo should also be printed on the pack.

The Halal certificate should be taken from accredited authority such as the IHAF or the SMIIC. So far, the government has still not been able to minimise or stop the smuggled food products in the country. The business community is being affected for maintaining their good work ethics. The majority of these products that are available on shelves for consumers are not compliant to the requirements of SRO 237 dated 19th February 2019 on amendment to Import Policy Order, 2016. Furthermore, the enforcement of SRO 237 has not been initiated at retail level by any government authority, leaving the opportunity for illegal/smuggled products to be sold on shelves for indefinite period.

All who are bringing in non-compliant products cause huge revenue loss to the government exchequer by not paying custom duty and regulatory duty.

Thus, selling the product on low prices in the market and cause loss to the companies those who are importing the same product and bringing into the country through legal means after paying Custom duty and Regulatory duty and then sales tax. To tackle the situation, custom authorities are taking stringent action against the smugglers and introduce measures with which such malpractices are stopped or minimised in the market.

Copyright Business Recorder, 2021