Historical Overview Of Customs Development And Progress:
The Kingdom's institutional instructions approved by the Royal Decree on 21 Safar 1345H (June 30, 1926) included the idea of creating a Customs Administration together with organizing the financial affairs including the sources of different revenues as well as the expenditures.
The first Customs Regulation in the Kingdom of Saudi Arabia was issued under the Higher Authorities Decree No. 326 dated Safar 3, 1349H (June 30, 1930).
On 29 Safar 1372H (17 November 1952), His Royal Highness the Crown Prince's letter No. 29/2/1/331 was issued, which provided, in its article No. (10), for creating a General Directorate of Customs. Its director should be appointed by the Minister of Finance and National Economy and be responsible to him for this organization. Immediately after that the Ministerial Resolution No. 549 was issued on 7 Rabie Awwal 1372 (25 November 1952) to create the General Directorate of Customs.
After that, as the government of the Kingdom of Saudi Arabia perceived the giant strides made by the country toward progress, and the world's attention started to focus on that comprehensive revival, the Higher Authorities' directives were issued to establish a Customs Regulation that would allow keep pace with this progress, and be in consistence with the close relationship linking the customs with importing and exporting corporations, companies, factories, etc. The new Customs Regulation was approved by the Royal Decree No. 425 dated 5/3/1372H (23 November 1952). Simultaneously, the Minister of Finance and National Economy issued the Implementation Rule of Customs Regulation.
As an encouragement to domestic industry and investors, all imports of domestic factories such as raw materials, equipment, appliances, and spare parts are exempted from customs duties according to a resolution to be issued by the Minister of Commerce and Industry. All exports of the Kingdom are exempted from customs duties according to the customs tariff except the raw hides and skins.
The Saudi Customs has developed and simplified the customs procedures to accelerate the release of imported, exported and transit goods. The computerization of customs operations started with the implementation of automation and advanced technologies at the Customs Headquarters and all ports. The customs procedures of goods release have become processed electronically for all transactions such as import, export, tariff, exemption, revenue, international conventions, importers and brokers' data, vehicles customs card, passengers and vehicles tracking, administrative and financial systems (such as payroll, personnel, administrative communication, and circulars), and legal systems (such as seizure reports, legal cases, etc.). A single customs declaration form has been implemented for all customs transactions (import, export, transit, re-export, and bonded warehouses) instead of a separate declaration form for each transaction.
The Saudi Customs has constructed an infrastructure of a countrywide computer network to implement the automated systems at all airport, landport and seaport customs. The Fiber Optic cables were used in the Local Area Network (LANs) extensions within each department and port. Leased Digital Data lines (DDN) were used to achieve connectivity between the ports. The Saudi Customs has relied on its own resources to develop its automated systems, which are operable on fileservers and workstations linked to the network employing Oracle Database Management System (DBMS) under the Microsoft Arabic Windows environment in accordance with the application program requirements.
The Saudi Customs has achieved a major breakthrough by implementing the X-Ray container scanner technology. It has been in use at the seaports, international airports and landports . Each X-Ray device unit can scan approximately 40 containers per hour, and it is durable to run for 20 hours per day at a production capacity of 800 containers per day. The X-Ray container scanner system has been integrated into the Saudi Customs Automated Systems in operation at the Headquarters office and ports.
At King Fahad Causeway, an automated system for registration of vehicles entry/exit using the driver's fingerprint and the vehicle plate number has been implemented instead of having the driver check with the customs staff for this purpose. The advantages of this system are minimizing the vehicle processing time to a few seconds, avoiding the data entry errors, and electronic matching of the data, which the vehicle driver provides, against his fingerprint.
The Saudi Customs has also implemented an automated system for recording the containers and trucks at the seaport customs gates. This system uses cameras which read the container number and the truck plate number and record them electronically. It verifies the legality of the procedure, completes the release measures, and opens the gate electronically.
The Saudi Customs has applied the e-learning with concentration on the International Computer Driving License (ICDL) syllabuses to develop the technical skills of the employees and boost their capabilities in dealing with the automated systems.
The Interactive Voice Response (IVR) system has been implemented at the Saudi Customs Headquarters. This system receives the user community comments and complaints through a unified telephone number and refers them electronically to the competent staff. It also receives the inquiries about the customs procedures and the stage which the transaction processing reaches at the Saudi Customs Headquarters.
The Video Conferencing System has been implemented between the Saudi Customs Headquarters and ports. This system provides the capability to the officials at the Saudi Customs Headquarters and ports to communicate and convene conferences through visual display devices.
The Saudi Customs has introduced the Electronic Data Interchange (EDI) in processing the manifest, customs declaration (import and export) and transshipment at Jeddah Islamic Seaport and King Abdulaziz Seaport in Dammam. The EDI facility has enabled the shipping agents and brokers to transmit the data electronically from their offices without the need to visit the customs port premises.
Currently, development of banks interface, statistical declaration, and transit systems is in progress. The Saudi Customs automated system will also be integrated into the automated systems of other relevant government agencies.
Within the context of the Saudi Customs ongoing efforts to modernize and simplify the customs procedures on a continuous basis to raise the efficiency and effectiveness of customs operations and provide customs information, the Director General of the Saudi Customs has issued a guide for each type of customs transaction according to the Customs Regulation and its Implementation Rule.
On the basis of the distinguished relations between the GCC member states, and in belief in the importance of the cooperation and coordination among them, the Gulf cooperation Council (GCC) was established in May 1981 at the founding session of the Higher Council held in the United Arab Emirates. At that session the GCC Basic Regulation was adopted. In the same year, the Unified Economic Convention was signed and became valid in March 1982. Executive steps were taken to implement the provisions of that convention effective March 1, 1983.
The first step was the establishment of a free trade zone among the GCC states. According to this free trade zone, all domestic products were exempted from the customs duties and other fees of identical impact pursuant to specific conditions. After two decades of the GCC joint work, a new economic convention was created. It was adopted by the GCC member states' leaders at Muscat Summit held in December 2001 to keep pace with the comprehensive progress in the GCC work and reflect local, regional and international economic changes. The convention included new provisions to develop the joint work, of which the most important are the issues pertaining to the customs union, GCC common market, monetary union, etc.
To achieve what was provided for in the economic convention among the GCC member states, the Customs Union was implemented effective January 2003. It included the adoption of a common customs law, unified customs declaration for (import, export, re-export, temporary export, transit, bonded warehouses, statistics), and unification of internal administrative, financial and customs regulations and procedures pertaining to import, export and re-export in the GCC states. It included as well the adoption of a unified tariff nomenclature in dealing with the outside world. It imposed a unified customs duty at a rate of 5% on all foreign commodities imported from abroad with the exception of the duty rates provided for. The commodities produced in any of the Customs Union member states are treated as domestic products. The implementation of the customs union included also the adoption of the single point of entry at which the unified customs duties collected and an agreement on a mechanism to distribute the customs revenue among the member states according to the final destination of the goods (i.e. the customs duties due on the goods will be transferred to the country in which the goods consumed). The GCC member states have agreed to establish an Electronic Data Interchange (EDI) project to interface the Customs Administrations in the GCC member states with the GCC General Secretariat in Riyadh. This project will help in following up the implementation of the customs union requirements and provide the statistical information on imports and exports among the GCC member states and with the outside world.
The Kingdom of Saudi Arabia has concluded bilateral, regional, and international commercial and economic conventions in order to develop its commercial and economic relations with various countries, encourage the commercial exchange and coordinate and simplify the customs procedures.
The Saudi Customs implements the Kingdom's customs policy that aims to achieve an economic integration between the Kingdom and its sister Arab countries. This integration is attainable by encouraging the imports and exports of domestic origin through the Arab League; unification, coordination and simplification of customs procedures; and granting preferential privileges of which the most important is the exemption of goods of domestic origin from customs duties. A unified customs tariff nomenclature has been adopted by the Arab League's member states on 12 Jumada Thani 1375H (28 October 1955) applying the scientific methodology in the same manner of the Brussels-based Customs Cooperation Council (CCC) tariff nomenclature. A convention among the Arab League's member states to facilitate the commercial exchange and regulate the transit trade was concluded on March 1953.
The Kingdom of Saudi Arabia has acceded to the Customs Cooperation Council 'CCC' (currently, World Customs Organization 'WCO') in Brussels according to the Royal Decree No. M/68 dated 29/12/l392H (3 February 1973) in order to benefit from the technical customs expertise, follow up the changes that will occur to the tariff nomenclature and attend the meetings held by the council's committees.
The accession to the International Convention on the Harmonized Commodity Description and Coding System took place on 15/6/1411H (2 January 1991), which was its implementation date in the Kingdom. The Kingdom of Saudi Arabia has acceded to the World Customs Organization (WCO) Convention on Coordination and Simplification of Customs Procedures - Kyoto Convention, Appendixes A3/B3.
The Kingdom of Saudi Arabia has acceded to the World Trade Organization (WTO) on 10/11/1426H (11 December 2005) and became the 149th member at the WTO.
The Saudi Customs website on the Internet (www.customs.gov.sa
) contains elaborately the details of all customs rules and regulations such as the common customs law of the GCC states, customs tariff regulation, customs procedures guide, instructions on practicing customs clearance business, cross-border procedures of Intellectual Property Rights (IPR).