A recent court ruling has underscored the crucial role of certificates of origin in determining the tax treatment of imported goods. Justice Patricia Mutesi of the Commercial Division of the High Court ruled that goods imported from COMESA member states must be accompanied by a valid certificate of origin to receive preferential tariff treatment in Uganda.
“The certificate must be filled out and authenticated in the prescribed form, containing a declaration by the exporter that the details are true and correct, and that the goods originate from the named country of origin,” the judge held.
The court held that the primary responsibility of the importer is to provide compliant documents, while the Uganda Revenue Authority (URA) is responsible for receiving, reviewing, and analyzing the import documents, including certificates of origin.
This ruling came in a case where Kuku Foods Limited, a franchisee of KFC, challenged the Tax Appeals Tribunal’s decision in favor of URA regarding the denial of preferential tariff treatment due to the absence of signed certificates of origin. The court upheld the decision, stating that “an unsigned certificate of origin is invalid, and URA is not obligated to accept requests for additional verification.”
Justice Mutesi emphasized that “the duty to present proper certificates of origin lies solely with the importer and that URA’s resources should be focused on collecting revenue and widening the tax base, rather than verifying defective certificates.”
The court’s decision highlights the importance of compliance with trade regulations and the need for importers to ensure that their documents are in order to avoid costly delays and penalties. URA argued that “the requirement for a signed certificate of origin is non-negotiable and essential for verifying the origin of goods.” The tax body further emphasized that “compliance with documentation standards is crucial for maintaining the integrity of trade agreements and preventing fraudulent claims.”
The court dismissed the appeal and held Kuku Foods Uganda Limited liable for costs and payment of tax amounting to Shs191,038,404.
