Insight : Business news


Managing the Temporary Importation Regime in Africa

The temporary importation regime (also known as the temporary admission regime) is a customs regime under which a good can be imported into the country of destination for a limited, specified or predetermined period without payment of any or all applicable duties and taxes.

Under this regime the importer is normally required to re-export the good within the applicable period. In some countries no duties or taxes are payable at re-exportation, while in others full or reduced duties and taxes are payable.

In some countries the right to benefit from the regime is contractual, typically granted by the state to a company under a public-private partnership. While in others it is enshrined in the customs or foreign investment laws.

There are risks associated with this regime, such as lack of appropriate tracking of the imported good which may lead to them being sold, dissipated, substituted or to failure to comply with other conditions.

Understanding the requirements

Businesses benefiting from the regime should clearly understand the requirements. At the beginning of a company’s operations, and periodically, training should be
provided to the logistics department and to any employees and managers approving the importation of goods under the regime.

Not all goods qualify. Each country has a category of goods that can benefit from the regime. Yet, consumable goods are not eligible and are normally subject to full custom duties and taxes. Companies’ logistics departments should work closely with customs clearance agents when deciding on the importation of a good.

Senior employees should be used who understand the regime, know the company’s inventory and the limitation of their powers

Internal procedures

Companies ought to establish a formal process for the pre-approval of the temporary importation regime – to help better monitor its validity and other conditions attached to it – and define the roles and responsibilities of all stakeholders within the company. Stakeholders should attest to have read and understood the process and vow to adhere to it. Moreover, the process should have a workflow and a list of goods imported by the company that fall within the scope of the regime.

Customs inspections

The laws generally provide wide powers to customs officials to inspect any goods during or after importation. The logistics department needs to know the records retention period for customs documents and duly comply with it.

Allocating the correct resources to a customs inspection is also very important. Senior employees should be used who understand the regime, know the company’s inventory and the limitation of their powers (such as the inability to negotiate or sign settlement agreements on behalf of the company).

Weighing the risks

The risks vary from country to country. But generally, mismanagement of the temporary importation regime can lead to:

  • revenue leakage due to payment of avoidable duties, taxes, penalties and external counsel fees;
  • disruptions to operations, including garnishment of bank accounts, suspension of customs accounts and even closure of companies’ offices;
  • seizure of the affected good;
  • a lengthy, costly and public court battle with the State; and
  • reputational loss with partners, clients and the customs administration.

Senior employees should be used who understand the regime, know the company’s inventory and the limitation of their powers

Mitigating the Risks

The contract

If permitted by the state, it is paramount to ensure the contract between the beneficiary of the temporary importation regime and any contractors and subcontractors allows for the regime to be cascaded down. To avoid disputes and potential litigation, the contract should also clearly define the scope and conditions under which the regime is to be used.

The temporary importation regime is notorious in Africa for creating economically unviable contracts. Businesses should avoid a situation whereby their liability for breach of contract exceeds the expected revenue. For this reason, the risks should be clearly allocated and if possible capped. For instance, the contract should clearly stipulate what is to transpire if a contractor fails to re-export the goods within the specified period. Similarly, the contract should also state the responsibilities of the beneficiary of the regime if it does not provide the pre-requisites for the contractor to benefit from the regime.

Compliance audits and financial provisions

To monitor compliance by contractors, it is recommendable that periodic audits are performed within the scope of the audit provisions in the contract. Additionally, companies should also perform periodic internal customs audits with their external counsel, including a physical count of the goods under the regime to ascertain their compliance. This should be followed by an assessment of the risk, an estimation of the potential exposure and to a provision taken by the Finance Manager. After the above has been completed, if necessary, companies should agree on a mitigation plan and on the best way to gradually regularise their situation.

Management System and Bonds

Businesses that can afford it should have a centralised system for the management of all goods under the regime and any other exonerations.

In some countries, to benefit from the temporary importation regime, businesses must issue a bond which is lodged with customs as guarantee for any duties and taxes that may become due because of failure to comply with any conditions. The bonds can be withdrawn once the good has been re-exported, so effective management is required.

In a nutshell, businesses that monitor their legal revenue leakage have identified that in Africa, customs disputes can have the biggest impact on a company’s income before taxes. Your business may hence benefit from taking a proactive approach with this often-overlooked issue.


Abraham Abia Biteo Roka is the Managing Director at Clarence and widely recognised as one of the leading energy lawyers in Equatorial Guinea, often speaking at events around the world. Abraham is particularly renowned for his ability to create and implement country and sector specific standards, policies and procedures.

Clarence offers its clients the freedom to operate in Africa. Thanks to our diverse resources, we understand Africa better than most firms. We assist clients to identify, assess and effectively minimise operational legal and regulatory risks. We develop creative and efficient solutions to operational challenges, so our clients can focus on growth and revenue. Our approach is to bridge the gap between external and in-house counsels. Our areas of practice include Energy and Natural Resources, Real Estate, Construction, Joint Ventures, Corporate and Commercial, Risk Management & Compliance, Litigation and Dispute Resolution, Government Relations, Customs and Taxation, Employment and Immigration, Aviation and Telecommunications. For enquiries, please contact us at