1. GLOBAL FORUM V Wold Customs Organisation East and Southern Africa Region

2. WCO ESA Region2 Introduction The Customs world has to accept that the incentives and opportunities exist in all revenue- collecting agencies to engage in corrupt practices. Based on this premise, every Customs administration should attempt to provide a framework for legal and administrative procedures that are necessary to detect, punish, and reduce such undesirable behavior. The trade community has a role to play in promoting integrity

3. WCO ESA Region3 Building a system to promote integrity in customs administration requires: Putting in place measures to combat corruption; Putting in place measures to combat corruption; On-going vigilance to ensure that the measures continue to operate and that corrupt behavior is detected and dealt with. On-going vigilance to ensure that the measures continue to operate and that corrupt behavior is detected and dealt with. Top Leadership commitment to address the problem and acting as role models. This should go beyond mere statements that corruption will not be tolerated to the actual actions. Top Leadership commitment to address the problem and acting as role models. This should go beyond mere statements that corruption will not be tolerated to the actual actions. Building a system to promote integrity in Customs Administration

4. WCO ESA Region4 Main elements to promote integrity in Customs administration 1. Clear legal, regulatory, and administrative framework for Customs Management; 2. simple, transparent procedures; 3. a professional customs administration; 4. performance standards; 5. code of conduct; 6. Effective internal audit systems with independence. 7. Whistle blowing programs 8. Business co-operation 9. Customs co-operation

5. WCO ESA Region5 Note!!! In support of these elements, there should also be an atmosphere that encourages the following; Dialogue with the trade community, Dialogue with the trade community, An independent, honest judicial system, and An independent, honest judicial system, and A press that is interested, able, and allowed to raise issues of corruption. A press that is interested, able, and allowed to raise issues of corruption.

6. WCO ESA Region6 1. Clear legal, regulatory, and administrative framework for Customs Management From a customs administrators point of view, simple, clear legislation creates the framework for the development of systems and procedures that are easily understood by both the trade community and the officials. Laws and regulations related to Customs should be easily accessible and understandable, and clear criteria should guide administrative discretion in their application.

7. WCO ESA Region7 Effective penalty system A good penalty system should provide the administrator with the ability to impose administrative penalties for minor offences. This may include:  fines, for example, for broken seals on vehicles transporting goods in-transit and presentation of declarations with an unacceptable level errors.  Serious cases of fraud, including the bribing of revenue officials, should result in more serious actions, including criminal prosecution

8. WCO ESA Region8 Provide an independent appeal mechanism Every customs law, no matter how well written, is capable of being interpreted differently. In order to preserve the independence of the officials and the integrity of the system, it is important that taxpayers have the ability to challenge decisions and be assured of a fair and equitable hearing and that decisions are widely publicized.

9. WCO ESA Region9 2. Simple, transparent procedures

10. WCO ESA Region10 Simple, transparent procedures (cont’d) To be effective and to reduce the opportunities for corruption, Customs systems should be based on the following: – one step process – minimize the information and documentation requirement – consistent interpretations, – Computerization – may reduce customs interventions

11. WCO ESA Region11 3. Professional customs administrations The development of professional Customs administrations is important, not only to improve the effectiveness of these administrations but, at the same time, to address issues of corruption. The best way of ensuring fairness and neutrality in the administration of the Customs administration is to develop professional administrations with clearly defined responsibilities and accountability for performance, including :

12. WCO ESA Region12 Professional management Customs administration to perform effectively require skilled, knowledgeable supervisors and managers.

13. WCO ESA Region13 Challenge Too often the senior officials in the administrations change as governments change and individuals with little or no knowledge of legislation, regulations, systems, and procedures are put in charge of collecting the revenue. In these circumstances, staff may perceive that they have limited career opportunities in the organization, little, if any, "loyalty" to the organization and, perhaps, consequently be more open to corruption

14. WCO ESA Region14 Management controls Management controls These are an essential component of well-run customs administrations. This includes: – a clear statement of goals and objectives; – well documented operating procedures; – supervision of day- to-day activities; and – a regular review of the outputs of employees. – Consideration of results of internal audits. – feedback from importers and exporters, and – views of employees in evaluating the operations of an office.

15. WCO ESA Region15 Compensation and working conditions Customs administrators must be provided with sufficient compensation to reduce the incentive to engage in corrupt practices. While civil service pay can never be at a level that will discourage all corrupt behavior, compensation can be set at a level that provides a good standard of Living and eliminates the need to accept "facilitation fees".

16. WCO ESA Region16 Appropriate working conditions The provision of appropriate working conditions is also important. This includes: 1. proper' office space, equipment (e.&, telephones, computers, and transportation), and supplies. 2. The administration should not have to rely on importers, exporters, or their agents to provide any facilities or equipment which could imply that a favor is expected in return.

17. WCO ESA Region17 Staff rotation Any regulatory agency is better able to carry out its functions in an impartial manner if it remains at arms length from those it is charged with regulating. Revenue agencies are no different in this regard. Accordingly, it is important that staff rotations take place on a regular basis to reduce opportunities for collusion.

18. WCO ESA Region18 4. Performance standards Customs administrations should put in place performance standards that enable policy makers, management, and the public to measure how well an administration is performing.

19. WCO ESA Region19 Firstly, it enables the policy makers including Ministers to hold heads of administrations accountable, if agreed standards are not met. Firstly, it enables the policy makers including Ministers to hold heads of administrations accountable, if agreed standards are not met. Secondly it enables management to measure the performance of offices and individuals and to identity potential problems. Secondly it enables management to measure the performance of offices and individuals and to identity potential problems. Thirdly, it makes very clear to the employees that there are expectations and that their performance will be measured against these expectations. Thirdly, it makes very clear to the employees that there are expectations and that their performance will be measured against these expectations. Fourthly, the public is aware of what is expected and, therefore, should be willing and encouraged to bring to the attention of management cases where the standards have not been met. Fourthly, the public is aware of what is expected and, therefore, should be willing and encouraged to bring to the attention of management cases where the standards have not been met. Advantages

20. WCO ESA Region20 Too often, the only performance standard established for the administrations is the requirement to meet certain revenue targets. This is not enough, particularly if corruption is a problem. Too often, the only performance standard established for the administrations is the requirement to meet certain revenue targets. This is not enough, particularly if corruption is a problem. Performance standards, in Customs administrations, should include the following: Performance standards, in Customs administrations, should include the following: NOTE

21. WCO ESA Region21 In customs administrations, there should be clearly articulated standards for the various functions that are performed. In customs administrations, there should be clearly articulated standards for the various functions that are performed. For importers, it is very important that they know the time that the goods will be under customs control. For importers, it is very important that they know the time that the goods will be under customs control. By establishing service standards and making them known to staff and to importers and exporters, By establishing service standards and making them known to staff and to importers and exporters, An administration can establish monitoring mechanisms to identify transactions, offices, and officers that do not meet the required standards. An administration can establish monitoring mechanisms to identify transactions, offices, and officers that do not meet the required standards. Reports from the monitoring system may also help to identify areas that should be investigated for potential corrupt practices. Reports from the monitoring system may also help to identify areas that should be investigated for potential corrupt practices. Service standards

22. WCO ESA Region22 It is important that employees and importers and exporters be aware of the conduct that is expected of both parties. It is important that employees and importers and exporters be aware of the conduct that is expected of both parties. By clearly articulating expectations, customs administrators can hold employees accountable for performance and take appropriate action. By clearly articulating expectations, customs administrators can hold employees accountable for performance and take appropriate action. Many administrations publish a 'code of conduct" with these expectations. Many administrations publish a 'code of conduct" with these expectations. For such a code to be effective; it must also include a description of the disciplinary actions. For such a code to be effective; it must also include a description of the disciplinary actions. 5. Code of conduct

23. WCO ESA Region23 While it is the overall responsibility of management to monitor performance and to ensure that operational policies are being followed and performance standards are being met, this must be supplemented by effective internal audit. Internal audit activities should include:- compliance with operational procedures— Operational procedures should be clearly defined and laid out in manuals or procedure guides. 6. Effective internal audit

24. WCO ESA Region24 The customs legislation should provide for a reward to whistle blowers 7. Whistle blowing program

25. WCO ESA Region25 The Business community has a role to play in promoting integrity; Sign a MOUs on facilitating trade as provided for under Pillar 2 of SAFE, Sign a MOUs on facilitating trade as provided for under Pillar 2 of SAFE, Trade associations could help in capacity building such as the accounting associations, Trade associations could help in capacity building such as the accounting associations, Business Associations could also develop integrity codes of conduct, Business Associations could also develop integrity codes of conduct, Develop integrity advocacy programs. Develop integrity advocacy programs. 8. Business co-operation

26. WCO ESA Region26 Member administrations are at varying stages of integrity development; Majority of member administrations have; Signed MOUs amongst themselves thus implementing Pillar 1 of SAFE – Examples: Joint Border controls, Information sharing on advance cargo, joint integrity training programs; Signed MOUs amongst themselves thus implementing Pillar 1 of SAFE – Examples: Joint Border controls, Information sharing on advance cargo, joint integrity training programs; Developed codes of conducts; Developed codes of conducts; Established audit and investigation units Established audit and investigation units Embraced WCO trade facilitation instruments such as the KYOTO convention. Embraced WCO trade facilitation instruments such as the KYOTO convention. 9. Regional perspective

27. WCO ESA Region27 In particular, the WCO ESA region has demonstrated its commitment to promoting integrity through the NAIROBI INTEGRITY RESOLUTION of 24 th Feb. 2007. In addition Member administrations AGREED to: Develop a regional integrity model code of conduct; Develop a regional integrity model code of conduct; Undertake peer reviews; Undertake peer reviews; Harmonize risk management systems, Harmonize risk management systems, Embrace integrity development tools of the WCO; Embrace integrity development tools of the WCO; Develop a regional pool of experts on integrity, Develop a regional pool of experts on integrity, Promote customs to customs co-operation and where possible share infrastructure such as NII. Promote customs to customs co-operation and where possible share infrastructure such as NII. Set up a C2B partnership week Set up a C2B partnership week The challenge is walking the talk! Finally, there is no easy or quick solution to the issue of integrity 9. Regional perspective (Cont’d)

28. WCO ESA Region28