Many of the spare parts needed to keep the local factory running have to be imported by air from Europe, often at short notice and there is increasing difficulty in obtaining the import documentation needed to clear goods from the local airport. You have enjoyed a good working relationship with the local importing agent but it is still commonplace for items to take over 10 days to clear customs.

Recently the situation has deteriorated to a degree where planned maintenance schedules have been put back and large “demurrage fees” have had to be paid for the storage of goods awaiting clearance. You have heard that other companies are having similar problems and that it is linked to the appointment of a new customs manager who is asking for an additional $500 cash payment for every consignment of goods that his team clears.

Anxious to resolve the situation you have met with three alternative import agents. One of these offers a gold star service whereby, for a 10% premium on agency fees, they guarantee 2 day customs clearance with agreement for your company to reclaim costs if this is exceeded. The 10% increase in agency fees is insignificant compared with the costs you are currently incurring. You strongly suspect that this covers the facilitation payment.

Your Regional Counsel has made it clear that facilitation payments will not get approval unless all reasonable efforts have been made to resist them. Your General Manager does not think that the customs official can be influenced and is very much in favour of the gold star service as it overcomes the problem without breaking the code.

•  Who needs to know about the situation?

•  What is the right thing to do in the short term?

•  What action could the company take in the long term to help the situation?

•  How would you advise your General Manager?