3Historical Background Changes in the economic policy of Zambia led to introduction of an open market economy around 1992.Resulted in an influx of different products on the Zambian market from all over the world.No scheme in place to check the quality of imported products until April 2003The absence of procedures to check the quality and safety of imports resulted in the presence of inferior quality and un-safe products on the local market.Introduction of the Import Quality Monitoring SchemeThe scheme was introduced in April 2003 under Statutory Instrument No /2003Targeted selected imports due to limitations on testing capacityInvolves inspection of goods at points of entryScheme not effective in controlling the quality and safety of imports
4Objectives and benefits for Zambia Prevent the importation of products not meeting quality and / or safety standardsPrevent the importation of counterfeit productsProtecting consumers and the interests of importersSupporting local producers against unfair competition and deceptive practicesFacilitate the clearance process by eliminating bottlenecks caused by the verification performed on arrival at entry pointsPromote exports and the quality image of the country products (via compliance)
5Why PVoC? It is very difficult to professionally verify goods at border points Limited capabilities of ZABS (necessary to keep product experts at every border point);Verification opportunity is limited by the need to discharge and re-load goods in containers;Testing capabilities are limited;Testing and assessment takes time, during which goods are stored,this incurs direct storage costs (costs can be significant),and increase working capital cost.It is even more difficult to track sub-standard products when in the market
6HIT RATIONumber of products in hypermarket is about 10,000. It will take one person about 1 week to estimate only correctness of labeling and expiry dates.Inspectors stand very little chance to chase all sub-standard products in the market.
7Solution: PVoC – Pre-Export Verification of Conformity to Standards Products are verified before they come to Zambia by qualified personnel of well established independent international companies.The verification process consists of the following modules:physical inspectionsampling and testingdocument verificationfactory assessment (for certified products)To verify products in this way the following is required:international office networkinternational expertsinternational laboratory networkexperience and track record in similar projects
8ALTERNATIVES TO PVoCKeep the status quo by not accurately checking the bulk of imported goods and thus continue with importation of sub-standard goods onto the Zambian market (the situation today);Increase several-fold capabilities of ZABS (large budget increase) to check on reasonable proportion of imported goods. ZABS will strive for that but it will take time and require heavy investment from the Government.Withdraw counterfeit and sub-standard goods from the market: requires sizeable workforce and a reinforcement regime, etc. Prevention is better than cure.
9HOW IS THIS PROBLEM SOLVED IN OTHER COUNTRIES: DEVELOPED WORLD OptionsAnalysisOption 1Self declaration of conformity supported by 3rd party test reports, audit reports, design approval etc.Market surveillance.Requires mature market and very well developed function of market surveillance. Not yet an option for Zambia.
10HOW IS THIS PROBLEM SOLVED IN OTHER COUNTRIES: DEVELOPED WORLD OptionsAnalysisOption 2Certification of products by state accredited private certification body (function exercised today by ZABS).Requires full fledged National Quality Infrastructure in the country (not in place today) andVery well developed network of product specific focused laboratories and product certification bodiesTo have it in place calls for developed R&D for every product type in the market, plus extensive standards library. Both are inadequate in Zambia, and the process of developing them is quite slow.
11HOW IS THIS PROBLEM SOLVED IN OTHER COUNTRIES: DEVELOPING WORLD Option 1Regulator focuses on a limited number of goods. Limited means a couple of dozen (e.g. The Philippines).Not suitable for Zambia, since there are a significantnumber of critical goods and the local production is faroutweighed by imported goodsOption 2Leave everything to market.The current situation in Zambia, current regulation on importquality not very effectiveOption 3Regulator exercises full control (South Africa).Cannot be implemented in Zambia currently as this requiresa heavy financial and human resource investment byGovernment.Option 4PVoC (Kenya, Egypt, Saudi Arabia, Algeria, Kuwait, Syria, more).
12VARIOUS CONFORMITY ASSESSMENT PROGRAMMES IN AFRICA AND MIDDLE EAST Saudi ArabiaUgandaSince 2010NigeriaKenya(Since 2005)Tanzania (coming soon)KuwaitEgypt(Since 2001)IraqSince 2011AlgeriaLebanon Iran
13FEE STRUCTURE Route A 0.450% of the FOB Value of the goods imported Minimum fee per shipment: USD 350 (shipments up to USD77,700 FOB value)Maximum fee per shipment: USD 7500Route B0.400% of the FOB Value of the goods importedMinimum fee per shipment: USD 290 (shipments up to USD72,500 FOB value)Maximum fee per shipment: USD 7000 subject to applicable commercial rates at the port of loadingRoute CUSD350 (three hundred and fifty US Dollars)
14Coverage and conditions The above fees cover the documentary verification and the physical inspection of goods,The above fees do not include the following activities:Testing: to be quoted on a case by case basisContainers sealing (if requested): to be quoted on a case by case basisProduct Registration: to be quoted on a case by case basisManufacturer licensing: to be quoted on a case by case basisAdditional fees where goods or facilities are not ready or available at the time the supplier has advised and therefore an additional inspection visit is required.
15Contractors Contact Details Bureau Veritas:SGS : Flat No. 2, Plot No ,Thabo Mbeki Road,Lusaka, ZambiaPhone:
16Conclusion Benefits Protect Consumer and Local Industry, Reduce Fraudulent Transactions,Fight against Counterfeit productsPrevent Unfair Competition,Simplify Procedures and Faster Customs Clearance,,Pre-export Verification avoids re-export of non compliant goods (protects the local importer)CONSUMER PROTECTION:Consumers and Importers lose income because of too many non conforming products in the marketEven when they turn to branded products, they will face counterfeit products with non conformity risk being even higher.CONFORMED PRODUCTS AT LOWER PRICEPVoC program does not increase the price of the productsPVoC program encourages serious importers to select reliable suppliers which can provide available conformed products at reduced price
17WHY PVoC IS NOT A PSIThe purpose of PSI is to improve revenue collection by ZRA by means ofCorrect classification of goodsCorrect valuation of goodsVerification of packing list and quantity of shipmentPSI was administered under the Ministry of FinanceThe purpose of PVoC is to ensure conformity of good to standards, mainly in terms ofhealth,safety andenvironment protectionQuantity is not essentialSampling, testing, analyzing of data sheets, risk assessment are critical activitiesThe PVoC will be administered by a statutory body (ZABS) under the Ministry of Commerce Trade and Industry
18Zambian Legislation Standards Act, Cap 416 of the Laws of Zambia Under Part II Section 5 of the Act, the functions of the Bureau are specified and two of these include:To promote and require the adoption of standards in industry and commerce with a view to improving quality of commodities, industrial efficiency and productivity and after sale support services and all aspects of quality assurance of commoditiesTo make arrangements or provide facilities for the examination and testing of:(i) commodities to which standards apply; and(ii) The material or substance from which a commodity may be produced, manufactured, processed, treated or finishedImport Quality Monitoring RegulationThe current regulation on import quality monitoring, SI 41 of 2003 is being amended to facilitate implementation of the PVoC program
20What is conformity assessment? Conformity verification is essentially risk assessment of the exporter/manufacturer’s statement that their goods conform to agreed set of requirementsConsists of the following modulesVerification of conformityPhysicalpre-shipmentInspectionDocumentarycheck ofconformitySamplingand testingFactory orlogistics centreassessment
21Conformity assessment is essentially a risk management system Takes into accountthe safety hazards inherent to the specific product (such as mechanical, electrical, thermal, fire or explosion, chemical, biological or radiation hazards)the severity of hazardsthe homogeneity of the consignmentthe reliability of the manufacturer / exporterthe final buyer and end use
22FORMS OF CONFORMITY ASSESSMENT Voluntary ConformityAssessmentMandatory ConformityAssessmentDepending on the risk of the productMandatoryCertificationDeclarationof ConformitySystems of VoluntaryCertification,Systems of MandatoryCertificationDeclaration basedon own proofsDeclaration based on 3rdParty documents (certificatesand Test reports)Equal Legal authority
23Voluntary ConformityAssessmentMandatory ConformityAssessmentMandatoryCertificationDeclarationof ConformitySystems of VoluntaryCertificationSystems of MandatoryCertificationDeclaration basedon own proofsPVoCSASOGOST RCE, GOST RISO 9001, 14000…BRCFI, SE, NE, DE…CSADeclaration based on 3rdParty documents (certificaand Test reports)
24FLOW CHART FOR PVoC GEOGRAPHIC PROCESS PVoC AgentsExporterPVoC:Inspection,Testing,Audit,Documentary verification…EXPORTING COUNTRYCompliant GoodscertificateClearanceZAMBIAPVoC AgentsImporter
25There are THREE ROUTES of verification of goods ROUTE A: applicable to any goods and any traderROUTE B:Recommended for frequent exporter with homogeneous products,Self-declaration of compliance supported by substantiated evidence (test reports, certificates, etc.),Registration is renewable annually, subject to continual compliance.ROUTE COnly for manufacturers; certain distributors may qualify as well!Consistent shipment compliance:Evaluation of test reports and additional testing to demonstrate full compliance with the Standards;Audit of the manufacturing facility & subsequent surveillance visits:Process closely follows ISO / IEC Guide 28 – General Rules for a model 3rd party Certification Systems for productsLicensing is renewable annually, subject to continual compliance.
26Review of registration HERE THEY AREInspectionTesting / test reportSatisfactory?CertificateGoodsNon conformityreportregisteredgoodsReview of registrationRiskassessmentBased on the riskAssessment:documentary reviewTestingROUTE BROUTE ALicensedRandom inspectionROUTE CYesNo
27FLOW CHART FOR PVOC ROUTE A InspectionTesting / test reportSatisfactory?YesCertificateGoodsNoNon conformityreport
28FLOW CHART FOR PVOC FACILITATION PROCESS - ROUTE B Satisfactory?YesCertificateNoNon conformityreportROUTE BBased on the riskAssessment:documentary reviewInspectionTestingReview of registrationRiskassessmentregisteredgoods
29FLOW CHART FOR PVOC FACILITATION PROCESS - ROUTE C Satisfactory?YesCertificateNoNon conformityreportROUTE CLicensedgoodsRandom inspection
31BASICS OF BUSINESS PROCESS Application(RFC+PI)RegistrationOffer to exporterAssigningStandards(classification)AnalysingsupportingdocumentsReceipt ofacceptance,invoicingSchedulinginspectionWritinginstructionto exporter&inspectorIssuance of CoCReviewingresultsInspectionTesting
32BASICS OF BUSINESS PROCESS – GOOD REGISTERED OR LICENSEDApplication(RFC+PI+IDF)RegistrationOffer to exporterAssigningStandards(classification)AnalysingsupportingdocumentsReceipt ofacceptance,invoicingSchedulinginspectionWritinginstructionto exporter&inspectorIssuance of CoCReviewingresultsInspectionTesting
33WHERE DOES IT BREAK Payment delays Application (RFC+PI) Registration Offer to exporterAssigningStandards(classification)AnalysingsupportingdocumentsReceipt ofacceptance,invoicingSchedulinginspectionPayment delaysWritinginstructionto exporter&inspectorIssuance of CoCReviewingresultsInspectionTesting
34Verification Of Conformity certificate One document:Issued by a competent and authorized companyRequired for each shipment and for customs clearancePrinted on safety paper or electronic format
35Used products without standards One document:Inspection ReportOnly Route A will be used as consistency in quality cannot be assured