REGULATORY AND COMPLIANCE LAW UPDATE: THINGS YOU SHOULD KNOW WHEN BUYING AND EXPORTING CASHEWNUT FROM TANZANIA

• Procedures involved in obtaining Cashewnut buying license in Tanzania
• Timelines, Requirements and conditions for eligibility to purchase
• Step-by-Step process of Buying and Export Cashewnut in/from Tanzania

1.0. INTRODUCTION

The Tanzanian economy is well known to be dependent on the Agriculture sector. Tanzania is well known to be among the leading Cashewnut producers in Africa. Areas known predominantly for Cashewnut cultivation include the southern coastal regions of the country, near the towns of Mtwara, Kilwa and Dar es Salaam. The Cashewnut Board of Tanzania (CBT) is entrusted with the responsibility of regulating the development of the Cashew Industry in Tanzania. In undertaking its mandated roles the CBT puts more emphasis in improving efficiency and effectiveness in the Cashewnut sub sector in order to meet requirements of different stakeholders thereby enabling them to contribute to the national development. The Board is established under section 3 of the Cashewnut Industry Act No.18 of 2009.

Our Regulatory Compliance Department at Breakthrough Attorneys prepared this Article highlighting the things you should know when buying and exporting Cashewnut from Tanzania.

2.0. THE REGULATORY BODY INVOLVED

The Cashewnut Board of Tanzania (CBT) is a corporate body established by the Act No. 21 of 1984 (As amended in 1993) to replace Tanzania Cashewnut Marketing Board (TCMB). CBT regulates the development of the Cashewnut Industry in Tanzania. The Board’s composition include among others;

1. A Chairman who is appointed by the President upon advice from the Minister;
2. One member representing large scale Cashewnut processors;
3. Two members representing Cashewnut farmers;
4. One member representing small scale Cashewnut processors;
5. One member representing the Ministry;
6. One member representing Cashewnut researchers; and
7. Two members who possess experience and knowledge in the Cashewnut industry as provided under section 4(1) of the Cashewnut Industry Act No.18 of 2009.

3.0. PROCEDURES INVOLVED IN OBTAINING CASHEWNUT BUYING LICENSE IN TANZANIA

Once the registration is made online on ATMIS, the buyer needs to pay Bid Security, which is the mandatory requirement. Bid Security is paid according to the tons of Cashewnut one is buying.. The required bid security is paid based on the following category below:

1. 50 -100 tones per auction amounts to TZS 20,000,000.00
2. 50 – 250 tones per auction amounts to TZS 50,000,000.00
3. 50 – 500 tones per auction amounts to TZS 100,000,000.00
4. 50 -1000 tones per auction amounts to TZS 300,000,000.00
5. 50 – 3000 tones per auction amounts to TZS 500,000,000.00
6. 3001 and above per auction amounts to TZS 1,000,000,000.00

NOTE:
The Bid Securities are refundable. The rates above signify the amount of Cashewnut the buyer wants to purchase. The Cashewnut Board fixes the rates and they are uniform.

4.0. STEPS UNDERTAKEN AFTER OBTAINING A CASHEWNUT BUYING LICENSE

1. Once the prospective exporter is issued with a buying license through the ATMIS website he will thereafter receive sales catalogue 12 hours before the auction via his email for the purchase of Cashewnut.
2. Normally, , one is advised to visit the Cashewnut Board of Tanzania’s Website so as to obtain the details and timetable for the Cashewnut auction that will take place.
3. A Bidding application letter is required to be submitted to the respective Cooperative Union, clarifying on the quantity of Cashewnut to be purchased as well as the bidding price of the same.
4. At the auction the bidder shall physically drop his bid in the tender box on the day of auction from 8:00 am to 4:00 pm. After 4:00 pm all bids applications are displayed to the public and the successful bidder will be announced.
5. The prospective winner during the auction will then receive a bid result notification from the Cashewnut Board Of Tanzania,
6. The respective winner from the bid shall collect the sales invoice Payments from the respective Cooperative’s union office one day after the auction is complete
7. Once the successful bidder completes the payment to the respective cooperative union’ account, the buyer shall receive the original warehouse receipt
8. The buyer shall present the original warehouse receipt and release warrant to the respective warehouse operator for the removal of the raw Cashewnut crops that have been purchased.
9. Thereafter the buyer shall proceed to obtain the Cashewnut consignment and Produce Dispatch Note, to obtain the same, one is required to submit the Sales invoice, Cashewnut Release Warrant and a Warehouse receipt.
10. Thereafter once the above steps has been completed and the buyer has received the Sales Invoice, Cashewnut Release Warrant and the Receipt than the buyer is supposed to submit the same to the Corporative Union so that he can receive the following;
    1. Dispatch Produce Note
    2. Tally sheet
    3. The Cashewnut Consignment
    4. Issue note from the respective Cooperative Union

5.0. STEPS TO OBTAIN AN EXPORT PERMIT FOR RAW CASHEWNUT

After having obtained the Cashewnut consignment from the respective Cooperative Union, An individual will receive credentials for (Production Management System (PMS) system from the Cashewnut Board of Tanzania by email address filled in Agricultural Management Information System (ATIMIS).

1. The first step entails an individual to apply for an export permit to the Cashewnut Board of Tanzania through the PMS once he/she obtains the credentials to login into the account, the legal basis for the export permit has been provided under Regulation 41(2) of the Cashewnut Industry Regulation 2010, where it provides that;
   

    in addition to export license, a Cashewnut exporter shall obtain an export permit from the Board”

2. The applicant will be required to submit the following for the application process;
   1. an application letter for raw Cashewnut export permit,
   2. Commercial invoice, which constitutes among others details of the importer, exporter, country of origin
   3. Booking confirmation
3. Once the documentation are submitted through PMS, the applicant will be issued with an export permit for raw Cashewnut online the PMS. The export permit is issued as per consignment and is free of charge. Its validity lasts for a period of 10 days upon its issuance.
4. The procedures undertaken for exporting cashewnut in Tanzania may slightly differ depending on the port chosen to export by a trader, one may wish to export through Dar es Salaam or Mtwara ports.

6.0. CONCLUSION

In the nutshell, anyone who is interested to buy Cashewnut has to obtain the buying license from Cashewnut Board of Tanzania entrusted upon by the Ministry of Agriculture to regulate the Cashewnut Licenses in Tanzania. The Procedures for obtaining the buying license is well explained in this Article, one has to be very careful and diligent when making an application by inserting the correct details and documents to obtain the buying license. For more details you can contact us on info@breakthroughattorneys.com.

 

Important Notice:

This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, Breakthrough Attorneys, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.