Business

Car dealers protest inspection fee

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Future Group Co. Ltd managing director Imran Yunus (L) with Jyoti Motor Ltd managing director Piyush Patel (R) after a press conference in Kampala on Monday. PHOTO BY STEPHEN WANDERA 

By ISMAIL MUSA LADU

Posted  Thursday, March 27  2014 at  02:00

In Summary

Effect. Importers say the levy will increase cost of doing business.

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Kampala.
Dealers in used cars have protested the amount of money that Uganda National Bureau Standards (UNBS) wants them to pay as a fee for inspecting vehicles before being shipped here.
According to the used car importers, the minimum of $300 (Shs769,000) for each inspection was not only unilaterally arrived at but its enforcement will see the cost of doing business increase.

The importers are required to pay the fee to Japan Export Vehicle Inspection Center (JEVIC), a company contracted by the Uganda National Bureau of Standards, to do the pre-inspection.
This, according to the used car dealers, means the cost of a vehicle will increase by a minimum of Shs 1 million and in some cases more, making it difficult for a consumer to afford and for them to keep in business.
UNBS and Uganda Revenue Authority are already imposing penalties on used vehicles that have been imported without undergoing inspection for radiation and road worthiness.

“There is no way the Government of Japan and the manufacturers of the car can allow vehicles emitting radiation to hit the streets. All the vehicles we import have been cleared and those that develop mechanical problems on transit can be fixed here,” the managing director of Future Group, Mr Imran Yunus, said in an interview earlier in the week.
“At the moment we are keeping our businesses shut—striking, to send a message to the government that we need this matter solved and importantly the inspection suspended as we jointly agree on how to deal with this issue once and for all,” Mr Imran said.

In an interview on Tuesday, UNBS executive director Ben Manyindo wondered: “Why should the inspection be done here and not in the country of origin?”
He continued: “What happens if the imports end up being unfit for usage/consumption where will it be dumped? Isn’t it better to do it from the country of origin so that incase of problem it’s easy to find a solution while there?”

Although Mr Manyindo disputed the claim that ongoing enforcement of pre-inspection of imported used vehicles (PVOC) was not a consultative process, he said engagement over the matter will continue as they seek to enhance compliance of the scheme—PVOC.

Options
Relocation: Mr Piyush Patel, an importer and exporter of Japanese vehicles, also told this newspaper that his colleagues—used car importers, are of the view that if business environment becomes unbearable as a result of UNBS actions, they will consider relocating their investment to other neighbouring countries.
Destinations: This is tenable given that over 50 per cent of used vehicles imported are sold to the neighbouring countries of South Sudan, Rwanda, DRC and Rwanda among others.

iladu@ug.nationmedia.com