New Customs Rules Put Importers Anxious

New Customs Rules Put Importers Anxious

Dec 31 , 2025.

Importers are voicing growing frustration over a new customs valuation directive that sets a 15-day window for challenging base prices set by the Ethiopian Customs Commission.

The directive, which governs how the value of imported goods is determined for tax and duty purposes, has come under scrutiny from traders who claim it imposes unrealistic demands that could inflate costs and exacerbate sector-wide pressures.

The directive lays out the legal framework used by the Ethiopian Customs Commission to determine the value of imported goods for tax and duty purposes, a process that directly affects customs duties, excise taxes, value-added tax and surtaxes. Because valuation determines the tax base, even modest adjustments can raise costs for traders and ripple across the wider economy.

Ethiopia’s total merchandise imports reached about 21.49 billion dollars in 2024, a 25.9pc increase from 2023 and the highest level of goods imports on record. With import value at this scale, valuation decisions have become a critical issue for revenue authorities and businesses alike. Customs officials argue that tighter rules are necessary to address long-standing problems of under-invoicing, inconsistent documentation and graft.

Importers counter that the new directive adds a procedural burden without adequately adopting how international trade actually works.

A base price settlement data system relies on international market prices when customs officers question the declared transaction value of imported goods. If they find the declared price inconsistent with their database, they often reject it and apply a base price instead. The directive states that transaction value, defined as the price actually paid or payable, should remain the primary method of valuation when credible documentation is available.

When doubts persist, customs officers may use alternative methods, including the value of identical or similar goods, in line with internationally accepted valuation principles under the World Trade Organisation (WTO) rules.

Importers who object to a base price determination are required to submit supporting documents, within 15 days, including purchase and sale contracts, bank-verified proforma invoices and official manufacturer price lists. If the importer fails to provide sufficient evidence by the deadline, customs officers may finalise the valuation using their reference data. Importers feel that this rule effectively forces them to accept customs values even when they believe those values are inaccurate.

According to an Ethiopian Customs Commission official, who spoke on condition of anonymity, the directive supports Ethiopia’s bid to accede to the WTO. It is intended to strengthen transparency and accountability in customs operations. He attributed inaccurate declarations and weak documentation to historically undermined revenue collection and eroded trust between customs and importers.

“The directive is meant to make the process transparent and traceable,” he told Fortune. “With accurate evidence, importers won't be affected by over-exercise, and the government will collect the right amount.”

Importers, however, find the deadline intensifies pressures already weighing on the sector. They argue that gathering the required documentation within two weeks is often beyond their control.

According to Yeshiwas Ademe, an importer with more than 20 years of experience, the timeline does not reflect the realities of international trade. He imports electric vehicles, elevators and industrial chemicals, sectors that often involve complex supply chains. As an electric vehicle importer, he brings in between three and 10 vehicles a shipment, depending on demand. He is part of the 16,000 importers who ordered 300,000 shipments recorded in 2024/25.

“Providing the documents they ask for is almost impossible within the deadline,” he said. "Even two months would be difficult in many cases."

According to Yeshiwas, foreign suppliers, banks and logistics providers operate on timelines that rarely align with local customs deadlines, particularly when additional verification is required. Manufacturers often impose minimum order quantities of 30 units, which forces smaller importers to rely on dealers or intermediaries. These dealers aggregate orders, handle procurement and deduct their commissions before purchase, but those commissions are not reflected in official manufacturer price lists.

“When the manufacturer’s price list doesn't include the dealer’s commission, our documents don't match,” he conceded. “This creates differences that make importers look dishonest.”

Such discrepancies increase the likelihood that customs will reject declared transaction values and apply base prices. Yeshiwas depicted the directive as one of several recent measures that have made importing more difficult.

“These days, it feels like every new rule is being tested on us,” he said.

Beyond vehicles, Yeshiwas imports about three elevators a year, each costing roughly 75,000 dollars, and brings in industrial chemicals about four times a year, with shipments valued at about 160,000 dollars. These imported goods are subjected to an excise tax of 27.5pc, making valuation disputes particularly costly.

Another electric vehicle importer, Zewdu Jemal, voiced similar concerns, focusing on how the base price settlement data system operates when transaction values are rejected. According to him, collecting the required documentation within 15 days is difficult, and failure to do so results in customs applying base prices derived from international market data.

“If we can't submit the documents on time, the system sets a base price based on international data,” he told Fortune.

Zewdu argued that the system does not adequately account for how importers actually operate, especially group purchasing arrangements and negotiated discounts.

Many importers buy collectively rather than individually, a practice not recognised by the valuation.

“The data system doesn't consider negotiations or bulk purchases,” he said, warning that this can inflate excise tax assessments.

Importers who fail to pay excise taxes on time risk having their goods seized, a threat that intensifies pressure on traders even when valuations are disputed. Zewdu imports between five and 10 vehicles a shipment, with prices starting at 13,000 dollars a unit.

The Ethiopian Chamber of Commerce & Sectoral Associations (ECCSA) has begun reviewing the directive in response to concerns from importers. According to its Communication Director, Teshome Wakjela, the Chamber is gathering information to assess the pressure the rules may place on importers.

“We've seen the directive, and although no official complaints have reached us yet, we're gathering information on the pressure it may place on importers,” he told Fortune.

Teshome acknowledged that malpractice exists among some traders, and the Chamber plans thorough research before raising concerns with the authorities.

"The Chamber will formally present its findings to the relevant institutions," said Teshome. "The issue could be raised through the Public-Private Dialogue forum. However, raising concerns doesn't guarantee policy changes."

Tewodros Kebede has more than 15 years of experience in Ethiopia and Djibouti, owner and manager of World Global Transit Logistics. He observed that valuation disputes often arise when importers source goods through intermediaries rather than directly from manufacturers. According to him, direct engagement with manufacturers allows importers to obtain official price lists that can address disputes. He also noted that over-invoicing remains a major concern for customs authorities.

“Some importers over-invoice to collect more foreign currency,” he said. "The practice contributes to foreign exchange losses."

Tewodros blames outdated customs price databases that are affecting even importers complying with the rules, as they fail to reflect current international prices. He advocated for a government-affiliated body to regularly update global market price data to improve valuation accuracy. He urged that importers who fail to settle excise payments within the deadline face a 20pc penalty, a factor that often forces compliance even when importers disagree with customs valuations.

PUBLISHED ON Dec 31,2025 [ VOL 26 , NO 1340]