SGS, Customs Close to Deal on Inspections

A company let go by the government in November after months of financial disagreement is expected to resume inspecting goods coming into Cambodia by May, officials said Sunday.

Customs Director Pen Siman said the Societe Generale de Surveillance of Geneva (SGS) was chosen over four other contenders through open bidding.

SGS will once again perform “pre-shipment inspection,’’ the  job of checking the quality and the quantity of goods coming into the country to allow the government to properly assess any fees that might apply.

In addition, the in­­spections check on smug­gling and other illegal operations.

Such inspections are standard for developing countries engaged in world trade, and the Interna­tional Monetary Fund has strongly urged Cambodia to resume the inspections as soon as possible.

“Resumption of pre-shipment inspection is a benchmark of the International Monetary Funds’ recommendations,” said Pen Siman. “We will finalize the contract next week and we’re expecting to start the pre-shipment services by the end of April.”

Robert Collier, SGS’ senior vice president, said Sunday the deal is close.

“We’re satisfied that the government is handling the deal in a very professional manner,” said Collier.

“We’re looking for a long-term relationship with Cambodia, hoping to work in other areas such as Camcontrol [a division of the Commerce Ministry] and ex­ports promotion,” said Collier.

Last November, the government terminated a five-year contract with SGS after an agreement on the government’s $6.8 million outstanding debt.

The government claimed at that time that SGS did not invest enough in human resource development for the Cambodian customs staff. At the IMF’s suggestion, the government sought bids on the contract late last year.

According to the bid requirements, the winning bidder must  inspect imported goods worth more than $4,000 on invoices. Im­porters must pay SGS a minimum flat rate of $250 for goods worth between $4,000 and $28,000.

Those who import goods worth more than $28,000 must pay 0.9 percent of the import value in service fees to the Swiss firm.

During the two-year contract, SGS will be required to transfer technology and technical skills to Cambodia and spend $500,000 per year for human resource development, Pen Siman said.

The contract will “improve collection of customs duties, reduce smuggling and corruption and improve quality control and quantity control,” he said. In the past, the government generated $5 million to $7 million annually in revenue from the inspections, Pen Siman noted.

While many traders welcome  resumed inspections, others suspect they may raise prices.

“Without the pre-shipment services, the government would lose a lot of money because the customs is not able to collect an exact amount of tax on goods,” said businessman Mong Reth­thy.

(Additional reporting by Kay Kimsong)



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