19 Feb 2014

Transshipment or importing finished products to meet orders is not allowed and companies have an obligation to prove they do not engage in such illegal activities.

In response to a questionnaire, deputy permanent secretary in the Ministry of Trade and Industry, Ms Peggy Serame said companies which exported through African Growth Opportunity Act (AGOA) were not allowed to import finished products in order to meet their quota.

AGOA requirements, she said, prohibited transshipment and the US authorities had a right to visit local manufacturers for verification.

Ms Serame said companies were obliged to keep books of accounts so that investigation could be carried out at any time even when the transactions had been finalised between the purchaser and the supplier.

This follows complaints from various local organisations that they were supplied with smaller cut sizes for staff uniforms from some of the local clothing manufacturers which led to speculations that the companies could be importing and labeling goods as local.

She stated that the ministry was not aware of any local clothing manufacturers who instead of manufacturing their products locally, import and label them local.

However, the Industrial Licensing Act is silent about action that has to be taken against companies that mislead consumers and the public at large that they were manufacturing instead of trading.

Ms Serame said for either manufacturing or trading activity, an entrepreneur should possess the relevant license and comply with all stipulated requirements, failure of which attracts a fine. The Department of Industrial Affairs is responsible for licensing all manufacturers in accordance with the Industrial Development Act. She said the

Industrial Development Act applied to all manufacturing enterprises which could either be wholly or partly owned by Batswana.

Manufacturers are classified in to small, medium, micro and large scale enterprises. Small enterprises, those with less than six employees with a turnover of up to P100 000, are exempted from licensing requirements under the Industrial Development Act. She noted that the said enterprises were registered in accordance with the guidelines on registration of small and medium enterprises.

Ms Serame said manufacturing companies were inspected quarterly by the ministry and the inspection was undertaken to ascertain compliance with the Industrial Development Act.

This, she said, would relate to whether companies were still in existence, have valid licenses and manufactures goods listed in the license.

She stated that application for industrial licence stipulates that once an investor is ready to apply for an industrial license, he or she must fulfill conditions, in line with the Industrial Development Act.

The application should also be attached with information stipulating a detailed description of the production process indicating how each product will be produced. ENDS