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The Polytol case: A landmark case offering opportunities for customs duty reclaim


As the Polytol case (the “Case”) follows its course through the COMESA Court of Justice (the “Court”), it breaks new grounds and invites the development of African jurisprudence. The recent preliminary decision has far-reaching consequences for businesses across the COMESA. From a domestic perspective, this case provides opportunities for local businesses to reclaim customs duty suffered on the import of goods originating from the COMESA Free Trade Area.


The COMESA Free Trade Area (FTA)

The COMESA Treaty establishes an area free from customs duties on goods originating from participating members.

The Common Market for Eastern and Southern Africa (COMESA) was established by Treaty in 1994 with the vision to enhance economic prosperity of its members through regional integration. One of its objectives is the creation amongst its signatories - currently 19 Member States (including Mauritius) - of a customs union, an area free from customs duties and other equivalent charges.

Thus, by a decision of the Council of Ministers of the COMESA, by 31 October 2000 participating Member States were required to remove customs duty on goods originating from participating Member States.

In 2000, in compliance with the COMESA Treaty, Mauritius eliminated customs duty on imports of goods originating from within the FTA (subject to presentation of a Certificate of Origin upon import) but in 2001 re-imposed duties on specific items.


The Polytol case

Polytol reclaims Rs13M of customs duty on imports from Egypt.

The basis of the Case is the re-imposition from 2001 to 2010 of 40% customs duty on paint and varnish originating from Egypt.

 Polytol argues that the imposition of this duty was in breach of the COMESA Treaty and seeks repayment from Mauritius of duties in the sum of around Rs13m suffered on imports from Egypt. The company sought remedy before the Supreme Court but the court found that it did not have jurisdiction to hear matters relating to the COMESA Treaty.

Represented by Counsel Razi Daureeawo and Rubna Daureeawo Daood, Polytol referred the matter to the COMESA Court of Justice in Zambia.

In its defence, the Government of Mauritius raised a preliminary objection questioning the Court’s jurisdiction to hear the matter. The Court, presided by the Chief Justice of Rwanda, considered the point at a hearing held in December last year and decided unanimously in favour of Polytol.

Reacting to the decision, the Director of Trade of the COMESA acknowledged the decision as a landmark decision in that it confirms that companies can have recourse to the Court where there are alleged violations of the COMESA Treaty, thereby giving another dimension to the COMESA Treaty.

The recent decision therefore confirms the Court as a forum for businesses to address any issues relating to the Treaty. Thus, for example, there is now a mechanism to challenge denial of COMESA duty exemption through rejection of Certificates of Origin by customs.

The main case is expected to be heard later in the year.


The opportunity

Potential refund on imports of other products.

Whilst the Polytol case challenges the imposition of customs duty on imports of paint and varnish from Egypt in the period from 2001 to 2010, in the same period customs duty was also imposed (potentially in breach of the Treaty) on other products originating from Egypt: soap, detergents and similar organic active products, paper based products including serviettes, and napkins for babies amongst others. Thus, a decision in favour of Polytol may also imply refunds of duties to businesses who have suffered duty on other imports originating from COMESA member states.


Should you wish to discuss this case, please contact:

Anthony Leung Shing, Tax Partner or Razi Daureeawo

Email : [email protected]

Tel. +230 404 5000


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