RESTRICTEDWORLD TRADE
ORGANIZATIONG/VAL/W/57/Add.4
9 August 2001
(01-3958)
Committee on Customs Valuation Original:  English
COMMUNICATION FROM BAHRAIN CONCERNING PARAGRAPH 1
OF ANNEX III OF TH E AGREEMENT ON IMPLEMENTATION
OF ARTICLE VII OF THE GENERAL AGREEMENT
ON TARIFFS AND TRADE 1994
Addendum
The following communication, dated 4 June 2001, has been received from the Permanent
Mission of Bahrain.
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The Permanent Mission of the State of Bahrain to the United Nations Office at Geneva has
the honour to enclose herewith a letter along with some documents, from the Office of the
Director-General of Customs of the State of Bahrain, concerning the replies to questions andclarifications requested by some Members during the plurilateral meeting to discuss the work
programme and the steps for implementing the Agreement on Customs Valuation.
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Directorate General of Customs justification for requesting an extension
for the implementation of the WTO Valuation Agreement
Clarifications sought by WTO
1. Computerisation of the Customs Clearing System
It has always been the policy of the Directorate General of Customs to adapt the latest
technical developments that are relevant in improving the efficiency and quality of service rendered to
our customers.  In line with this policy we have carried out an extensive study to develop a suitable
computerized system for the clearing activities.  An  invitation for Tenders was issued in the first half
of this year.  Evaluation of the bids and implementation of the system is expected to be completed bymid-2002.
This system will enable importers, exporters, clearing agents, banks, shipping agents and
other Ministries to work closely with the Customs Directorate in a more efficient and faster manner,
which will be very cost-effective.  The new system is designed to execute all customs activities in just
a single declaration form instead of the present six forms.
We will be closely monitoring the new system.  Once we are satisfied that the new system is
operating accurately and is resulting in a substantial saving of time and cost, then we shall consider
switching over to the fully computerized system, in order to facilitate the implementation of the
Valuation Agreement.G/VAL/W/57/Add.4
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2. Training of Directorate General of Customs Staff
Upon the request of the State of Bahrain, the WTO Secretariat sent an expert, Mr. Siegrist to
Bahrain, to train the relevant staff of the Customs Directorate, for the implementation of the Valuation
Agreement.  They conducted workshops to explain all the steps that are required to be taken in orderto start the implementation of this Agreement.
These training programmes were attended by experienced officers of the Customs Valuation
Departments along with delegates from the private sector, clearing agents, and the training
community.  A copy of the report submitted by Mr. Siegrist on behalf of the WTO Secretariat is
attached
1.
The Customs Directorate is making every effort to implement all the Articles of the Valuatoin
Agreement in an efficient manner with full transparen cy, by ensuring that the clearing agents and the
customs staff have an understanding of this Agreement.  Appropriate action is being taken to
announce the implementation programme of the Valuation Agreement to all concerned.
Bahrain has no problem in implementing the new Valuation System, providing we make the
right start by taking appropriate steps to ensure that the interests of the concerned parties are very well
protected.
3. Training of Clearing Agents
One of our targets is to train the clearing agents who are an important part of the customs
activities.  Hence it is vital to upgrade their abilities and knowledge by imparting appropriate training
on how to deal with the new computerized system of clearing and also how to apply the Valuation
Agreement.  In this regard we invited delegates from the clearing agencies to attend the Seminar
which was conducted by the expert offici als from the WTO who visited Bahrain from
20-25 January 2001.
4. Implementation of the GCC Unified Customs Ordinance and legislation for the
implementation of the same
It was decided in the meeting held in December 2000, by the leaders of the GCC, that the
GCC Unified Customs Ordinance will be implem ented by all GCC countries by 1 January 2002.
Article 26 of this Ordinance stipulates the methods of customs evaluation which are in line
with the WTO Agreement.  (Copy of the Arabic version of Article 26 is being sent, as this is the latest
amendment and has not been translated into English yet)1.
The GCC Council has asked to commence the legal explanation of the rules in June 2001.
This will enable the competent authorities of the Member States to implement all these procedures in
a more efficient manner and with more transparency.  It will give the legal explanation of all the
Articles.
Article 61 relates to the forming of a Common Valuation Committee to review the complaints
of traders and other matters that are raised at Customs Checkpoints by the concerned parties regarding
unacceptable assessment values.  It has been our past experience that no such cases have been raised
in Bahrain, as they have the right to appeal, and also because of the very good relations between
traders, Customs Directorate and other concerned parties.
                                                     
1 Available for consultation in the Secretariat (Market Access Division).G/VAL/W/57/Add.4
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Article 62 of the Unified GCC Customs Ordinance stipulates the technical solution in the
settlement of disputes between the customs, trad ers or owners of the goods/consignment.  In this
regard the report of the WTO delegates who were in Bahrain, indicate these points about the GCC
ordinance and the contents and explanation regarding Customs Valuation.
5. Implementation of the GCC Common Customs Tariff
A decision has been taken by His Highness and the leaders of the GCC countries to
implement the GCC Common Customs Tariff from 1.3.2005 onwards, which will be the start of the
GCC Custom Union.
The GCC Customs Tariff is divided into 3 categories as follows:
(a) Duty free imports:  all consumer goods and food stuff which are basic necessities, and some
medical materials and equipment, will be free of customs duty.
(b) Luxury and long life products:  the rate of duty will be 5.5 per cent.
(c) Balance items such as jewellery, watches and some electronic goods will be 7.5 per cent.
From the beginning of the year 2000, Bahrain started the practical implementation of a
schedule created, so as to reach the GCC Common Customs Tariff in 2003.  Due to this the State ofBahrain will lose approximately 14 Million BD which is about 37 Million $US.  This is the effect of
the reduction in customs tariffs from 10% to 7.5% or 5.5% and reduction in customs tariffs on
vehicles from 20% to 15% in 2001, and from 15% to 10% in 2002 and from 10% to 7.5% in 2003.  (A
copy of the explanation of the above is attached)
1.
Once again, Bahrain has no major difficulties in implementing the WTO Valuation
Agreement, after being granted the requested extension, as the changes required will have been placed
and phased out in a systematic way as was done by other Member countries, to be in line with the
requirements of the Agreement.
Presently Bahrain Customs is starting to prepare in many fields, in order to be capable of
implementing the Agreement in a proper way:
The steps taken are:
- Onset of the training of the Directorate Ge neral of Customs staff in January 2001, when WTO
delegates were invited by the State of Bahrain to train staff and give their expert advice andhelp on implementation of the Valuation Agreement.
- The Directorate General of Customs staff have been attending various training courses in
GCC and Arab countries, who are more experienced in customs valuation:  for example (a) a
workshop was attended in Jordan on the Valuation Agreement from 10-12 April 2001;  (b)training sessions held by the Kingdom of Sa udi Arabia GCC Council on customs valuation at
the beginning of 2001 and to be held later in the year.
- Restructuring of the Valuation Division in the Directorate General of Customs Organization
Structure, after taking into account the experience of the GCC and Arab countries, especiallyJordan.G/VAL/W/57/Add.4
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Please note that we shall start to implement the Valuation Agreement by the year 2003, as per
the extension requested by us in our letter No. M/167/152/16 dated 16 No vember 2000.  Although the
work programme submitted by us is up to the year 2005, it does not imply that we are requesting an
additional extension.
Attachments1 :
1. Report of the WTO delegates on the valuation mission 20-25 January 2001, in Bahrain.
2. GCC Customs ordinance.
3. Structure of the new division.
4. Bahrain tariff.
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