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Country Commercial Guides for FY 2000: Cote d'Ivoire Report prepared by U.S. Embassy Abidjan, released July 1999

CHAPTER VI:   TRADE REGULATIONS AND STANDARDS

1.   Trade Barriers, including Tariffs, Non-Tariff Barriers and Import Taxes

Commercial Barriers

Traditional barriers to U.S. exports and investment include: (1) Lack of U.S. interest due to the relatively small market size and stronger attraction of other overseas markets; limited data; and perceived French and European domination of the market due to French-based legal, commercial, and financial systems; (2) Use of French language, business practices, and technical standards; the cost of producing sales collateral and packaging for the Francophone region. (3) Higher freight rates and longer transit times from the United States than from Europe. (4) More favorable credit terms by European suppliers to local importers. (5) High business costs relative to neighboring African countries such as water, electricity, labor costs, port processing and customs duties. (6) Uncertain legal protection, lack of information on intellectual property rights in the region, a corrupt court system and a slightly high crime rate. (7) Limited and costly financing resources for U.S. exporters and Ivorian buyers. (8) Limited Ivorian purchasing power. Nevertheless, some of these barriers are changing, for example freight rates from the United States have decreased significantly due to a new bulk service from Maersk Line. Business costs are not relatively high because of severe electric problems experienced in Côte d'Ivoire's neighboring countries in recent months.

Tariffs and Import Taxes

Côte d'Ivoire has a tariff structure composed of two basic customs charges: a fiscal duty and a customs duty. Together the maximum rate is 35 percent. There is also a statistical tax of 2.6 percent paid on all declarations, a value added tax (VAT) of 20 percent, special compensatory levies on meat and poultry imports and specific excise taxes on tobacco products and alcoholic beverages. Most of the duties are based on ad valorem rates which are imposed on the current export price from the country of sale or origin plus any shipping or insurance expenses incurred. (C.I.F.) The method of value assessment in use is based on the Brussels Definition of Value (BDV). After five years, Côte d'Ivoire, a voting member of the Customs Valuation Code (CVC), has not implemented the code but will apply it in the near future, as well as other members of the UEMOA countries which must follow the same rule.

2.   Customs Valuation

Regulatory Agencies

Governmental agencies responsible for regulating business activities include:

Taxation Direction Generale des Importations, Ministere de l'Economie, des Finance et du Plan (The Tax Department of the Ministry of Economy, Finance and Plan)

Monetary Transactions Direction des Finances Exterieures et de Credit du Ministere de l'Economie, des Finances et du Plan (The International Finance and Credit Department of the Ministry of Economy, Finance and Plan)

Labor Issues Agence d'Etude et de Promotion de l'Emploi (AGEPE). The Labor Department)

Copyrights Bureau Ivoirien de Droits d'Auteurs (BURIDA) (Ivorian Bureau of Author's Rights)

Import/Export Licenses: Direction du Commerce Exterieur du Ministere du Commerce et de l'Industrie (Department of External Trade of the Ministry of Commerce and Industry)

Côte d'Ivoire subscribes to the pre-inspection service of the Swiss company, Société Generale de Surveillance (SGS). All goods entering the Côte d'Ivoire that are worth more than CFA/F 1 million (1 USD equals approximately CFA/F 600) must be inspected by SGS at the point of origin to ensure that invoice valuation is consistent with the goods actually shipped. An SGS certificate is then used as the basis for customs valuation. Exporters should note that the SGS inspection process is triggered by the local (Ivorian) importer when he/she applies for an import license, also known as a FRI (Fiche de Renseignements à l'Information). In 1998 SGS renewed its contract with the Ivorian government for two years. For more information, please contact SGS' U.S. office: SGS Government Programs, Inc. 42 Broadway, New York, NY 10004. Tel: 212-482-8700; Fax: 212-363-3316.

3.   Import Licenses

Quotas

The Ivorian government has liberalized the importation of goods and services. There are no more quotas and importers no longer need prior authorization. Only textile products are subject to a few authorization requirements. Import licenses are no longer required for most products. Products that still require authorization are petroleum products, and livestock and animal products (including hides and skins) which are still subject to prior authorization from the Ministry of Agriculture.

Errors/Voiding of a License or Intent

An Import License or Intent to Import becomes void if: 1) the importation does not take place, 2) the supplier is changed, 3) the importer is changed, 4) the value or quantity is changed by more than 10 percent. The importer should contact SGS liaison office in Abidjan to make the required changes.

4.   Export Controls

Export Licenses are required for any goods for which export is restricted. Export licenses are valid for six months and are prepared in quadruplicate. Except for coffee and cocoa, whose licenses are prepared by the reorganized Nouvelle Caisse de Stabilization et Soutien des Prix de Produits Agricoles (la Nouvelle CAISTAB), all export licenses are issued by the Ministry of Commerce and Industry. In line with the GOCI's (Government of Côte d'Ivoire) decision to liberalize coffee exports in October 1998, it has established a one stop shop for the exportation of coffee and cocoa with the aim of facilitating and accelerating administrative procedure. It is also meant to produce uniform export statistics by the different administrative sectors and to ensure efficient and accurate statistical collection of export receipts.

5.   Import/Export Document Requirements

Documents for most goods shipped into Côte d'Ivoire include:

Commercial Invoice: Freight and two copies in French are required. There is no required form to be used, but all invoices must contain the names of the exporter and consignee, number and types of packages, marks and numbers on the packages, net and gross weights, C.I.F. value, terms of sale, and a thorough description of the merchandise.

Certificate of Origin: Two certified copies are required.

Packing List: Packing list are not legally required but such lists are usually considered essential in accelerating the time required for customs clearance.

Bill of Lading (or air waybill): There are no regulations specifying content of a bill of lading. Importers should include clear marks of identification and the name and address of the consignee of the goods. It is important to assure that shipping marks and numbers on bills of lading/ invoices, on the goods should correspond exactly.

Pro-forma Invoice: Persons wishing to import goods are required to attach six copies of this invoice to the application for an import license and/or the intent to import. A pro-forma invoice may also be required when presenting an application to Ivorian authorities to ship bonded goods through the country.

SGS Inspection Certificate: Issued by the inspecting SGS office at the point of origin and delivered to the importer in Abidjan.

6.   Taxes, Duties, and Investment Incentives

The value added tax rate in Côte d'Ivoire was reduced to 20 percent (from 25 percent) and the weighted average duty rate has been reduced from 43 percent to 33 percent over the past three years. The corporate tax rate on profits is 35 percent.

New investments in Côte d'Ivoire may be eligible for customs exemptions, reductions in duty rates and other tax incentives. The investment incentive scheme is divided into two zones, Zone A - the region around and including Abidjan, and Zone B — the rest of the country. The benefits include exemption from income taxes and licensing fees for 5 years in Zone A and 8 years in Zone B. A larger investment may be granted exemption from VAT on equipment (including the first consignment of spare parts) if it is greater than 500 million F/CFA; the duty rate is reduced to 5 percent for investments between 500 million and 2 billion F/CFA; and complete exemption from duty and VAT on both equipment and materials is accorded for investments greater than 2 billion F/CFA. Properties built for investments greater than 2 billion F/CFA are exempt from property tax. The above description is general; for a more precise explanation of the incentive program, contact CS-Abidjan or CEPICI with specific information concerning your investment plans.

7.   Foreign Trade Zones/Free Ports

Bonded warehouses exist, and bonded zones within factories are allowed. High port costs and maritime freight rates have inhibited the development of in-bond manufacturing or processing, and there are consequently no foreign trade zones. Bonded warehouses serve mostly for transshipment of goods to Mali and Burkina Faso. (Also see paragraph 11).

8.   Temporary Entry

A new or a temporary business may apply to the Ministry of Commerce and Industry for Admission Temporaire, or temporary entry, of their goods. This status may also be accorded to goods that will be re-exported to other countries if a bonded warehouse is not used. New investments may also apply for a priority agreement. Both are granted on a case-by-case basis.

Many business travelers bring laptop computers into the country to aid in their affairs during their visit to West Africa without difficulty. Traveling with desktop computers or other electronic equipment may pose a problem if the equipment is new or the quantity is such that it may be suspected of being brought into the country for resale. Business travelers should be prepared to demonstrate the business purpose of the equipment, and may want to consider requesting temporary entry permission for expensive equipment.

9.   Labeling, Marking Requirements

In addition to the requirements described under import/export documentation, all packages containing U.S. produced merchandise must be clearly labeled "MADE IN THE U.S.A." or they will not be allowed to enter the country.

For high-tech equipment such as telecommunications equipment, photocopiers, computer hardware and software, French-language key boards, symbols, instruction manuals, operating systems and applications software are critical to the success of a product. Do not assume the user is a native English speaker. The equipment must be adapted to run as specified by European electrical and metric standards.

Consumer product labels, generally, must be in French for a product to be of interest to importers and consumers. Manufactured food products must be labeled in French and must have an expiration date. Health officials will often interpret the date of manufacture as an expiration date, if one does not appear on the label, and deny entry to the product. Therefore, it is best to include both dates.

10.   Prohibited Imports

Goods not eligible for import, or subject to import restrictions into Côte d'Ivoire include: live animals and genetic material (veterinary pre-approval by the Ministry of Agriculture), live plants and seeds (sanitary approval by the Ministry of Agriculture), arms or munitions, plastic bags, distilling equipment, pornography, saccharin, narcotics, explosives, illicit drugs, and toxic waste.

11.   Standards

Côte d'Ivoire uses 220 v 50 mhz cycles for electricity and the metric system of measurement. Standards usually follow the French or European norm.

12.   Free Trade Zones/Warehouses

Côte d'Ivoire operates a transit zone facility in Abidjan for goods being shipped to Burkina Faso, Mali and Niger. Bonded warehouse facilities are available in Abidjan. To utilize a bonded warehouse, the exporter must engage a local importer. The exporter ships to the bonded warehouse which then accepts payment from the importer for the product as the importer withdraws it from the warehouse. The bonded warehouse system allows the importer to avoid the cost of opening a letter of credit and of paying high local interest rates. However, the exporter must take into account in his pricing the cost of financing the goods while they are in the bonded warehouse. The importer and exporter should agree on a time limit by which the importer must take receipt of the full shipment. The Ivorian government plans to establish a free trade zone in the near future (See paragraph 6 above).

13.   Membership in Free Trade and Monetary Agreements

Côte d'Ivoire is member of three regional economic and monetary agreements and institutions: Union Economique et Monetaire Ouest Africaine, UEMOA (Economic and Monetary Union of West Africa), and Communaute Economique des Etats d'Afrique de l'Ouest, CEDEAO (Economic Community of Ouest African States, ECOWAS, and the Lomé Convention.

Côte d'Ivoire is a member of UEMOA covering 60 million inhabitants, which in 1994 replaced and enhanced (with economic cooperation) the former UMOA (Monetary Union of West Africa) in the following member countries: Côte d'Ivoire, Senegal, Mali, Togo, Benin, Niger, Guinea-Bissau, and Burkina-Faso. Under this treaty, Côte d'Ivoire has undertaken to coordinate its economic, financial, and structural policies with those of its Francophone partners in the region. Beyond reducing inter-zone tariffs, the UEMOA's structures include:

1)   A common accounting system, with a unique bookkeeping system called SYSCOA (Système Comptable Ouest Africain) which will harmonize the different accounting systems used by each member country;

2)   A Regional Stock Exchange;

3)   A Customs Union. Since July 1, 1997, customs duties on goods manufactured and marketed in the UEMOA zone were reduced up to 60 percent in total.

To qualify for the tariff reduction, products previously approved by a specialized UEMOA Commission shall meet the following selection criteria:

The product must be made in the UEMOA zone and 60 percent of the raw material used in its manufacturing or a minimum 40 percent added value shall be of UEMOA origin.

The UEMOA experts are now actively working to breaking up all non-tariff barriers in the union in order to facilitate the effective implementation of the common unique tariff by the end of 2000. UEMOA is in the process of harmonizing customs regulations and business law and practices among its members.

Monetary cooperation already takes place under French Franc zone arrangements, with a common central bank, the BCEAO (Central Bank of West African States), located in Dakar. To ensure the convertibility of the CFA franc, the Banque de France guarantees the money issued by the BCEAO (and its Central African counterpart BEAC), in exchange for a BCEAO reserve requirement at the French Treasury. (See section IV. 6, above)

Côte d'Ivoire is also a member of ECOWAS, the Economic Community of West African States. ECOWAS, which groups both Anglophone and Francophone states of the region, also has as its goal (as does UEMOA) a customs union which is to lead eventually to a full common market, and the free movement of labor. Original ECOWAS arrangements called for full tariff exemptions for companies which are at least 25 percent owned by citizens of member states, and exemptions for goods which are at least 40 percent manufactured within ECOWAS. Member countries were allowed to "phase-out" their inter-community tariffs over the coming decade, however, and little has been accomplished to date. The Government of Côte d'Ivoire has agreed to re-examine its moribund relationships with ECOWAS in the context of its commitment to greater regional integration in the future, but UEMOA seems to have the government's priority.

The agreement known as OHADA (Organization pour l'Harmonization en Afrique du Droit des Affaires) harmonizes a broad range of legal systems which previously covered a wide disparity in business law, codes, rules, regulations and local conventions affecting business. The agreement creates a number of uniform acts and sets up organizations when necessary to implement the acts. These acts cover commercial law, law of commercial companies and economic interest groups, organization of securities, bankruptcy proceedings, the discharge of liabilities, law of debt collection, and accounting and arbitration. OHADA has changed many of the regulations affecting the formation of new business entities in Côte d'Ivoire (see Section IV. 6, above). While U.S. mining companies will still face country specific regulation for mining codes dealing with mineral rights, licensing, access, and ownership issues, the harmonization of commercial law in the region makes it easier to function as a single business entity.

Côte d'Ivoire is a signatory to the Lomé Convention, a trade and aid agreement between the European Union and 46 of Europe's former colonies and dependencies in African, the Caribbean and the Pacific (the ACP group). Lomé arrangements guarantee duty-free entry into EU member states for a number of commodities and products produced in ACP countries.