AEO is a concept under the World Customs Organization (WCO) SAFE Framework of Standards to Secure and Facilitate Global Trade (SAFE Framework). It represents a Customs-to-Business partnership to enhance international supply chain security and facilitate movement of legitimate goods.
An AEO may be defined as a party involved in the international movement of goods in whatever function that has been approved by or on behalf of a national Customs Administration as complying with WCO or equivalent supply chain security standards. AEO include inter-alia manufacturers, importers, exporters, brokers, carriers, consolidators, intermediaries, ports, airports, terminal operators, integrated operators, warehouses and distributors. The facility is open to all stakeholders in this supply chain.
What are the benefits of the AEO programme?
- The following are the perceived benefits of the AEO programme.
- Faster movement of cargo through the Border/Port of entry
- Simplified Customs formalities
- Fewer physical and document-based controls
- Reduced demurrage and other related costs
- Priority treatment in query resolution
- Choice of the place for physical examination
- Facilitation for movement of cargo during periods of trade disruptions
- Improved relations with ZIMRA
- Promotes an AEO accredited entity as a secure and reliable trade partner thereby improving business competitiveness.
- Mutual recognition of AEO authorizations between Customs authorities as a long term
- Provides businesses with internationally recognized security standards.
- The opportunity to self-assess allows entity to have a full insight into its operations and business practices, identify and strengthen any security or compliance related weaknesses.
The AEO is required to;
- Keep proper records it terms of Section 223 of the Customs & Excise Act [Chapter 23:02].
- Maintain an accounting system which is in accordance with the Generally Accepted
- Accounting Practices (GAAP) and which facilitates audit based customs control.
- Ensure that its staff members conduct business in accordance with the procedures of the
- Customs & Excise Act and any other Act administered by ZIMRA or any instructions given by
- the Commissioner of Customs & Excise.
- Ensure a relationship of good faith is maintained by its staff at all times in dealing with the ZIMRA.
- Allow ZIMRA officers physical and electronic access to the information and documents as provided for in terms of Section 223 of the Customs & Excise Act.
- Use compatible E-Systems for Customs procedures and commit to regularly upgrade the systems.
- Ensure that its premises are in conformity with the appropriate security and safety standards.
Any entity interested in getting benefits of the AEO programme shall apply in writing to the Commissioner of Customs & Excise for accreditation. The entity must meet the following conditions:
- Be established in Zimbabwe;
- Have appropriate record of compliance with Customs and other relevant laws;
- Have a satisfactory system of managing commercial and, where appropriate, transport records;
- Have proven financial solvency; and
- Ensure that there is general maintenance of approved security and safety standards at both the entity`s place of operations as well as its business systems and procedures.
AEO Application Process
- Consultation with nearest ZIMRA office on AEO application procedure
- Completion of and submission of self-assessment questionnaire, application form and other relevant attachments required for the granting of AEO status
- Examination of application by ZIMRA
- Onsite inspection by ZIMRA
- AEO authorization1
An overview of the AEO in ESA selected countries as at 17 May 2023
|NUMBER OF AEOS
Why is there a low AEO uptake?
There could be several reasons why the uptake of Authorized Economic Operator (AEO) programs is
low. Here are a few possible explanations:
- Lack of awareness: Many companies may not be aware of the benefits and advantages of
becoming an AEO. Many clearing agents are unaware of the benefits of AEO certification and
the requirements for certification, they may not fully understand the program or its potential
impact on their operations. Insufficient promotion and information dissemination about AEO
programs could contribute to low uptake.
- Perception of complexity: Some businesses may consider the process of obtaining AEO
certification to be overly complicated and time-consuming. The application process,
documentation requirements, and ongoing compliance obligations may seem daunting or
burdensome, especially for smaller companies with limited resources.
- Cost considerations: The financial costs associated with becoming an AEO can be a deterrent
for some companies. There may be fees for certification, training, security enhancements, and
other necessary investments. Businesses may be hesitant to allocate resources to these
expenses, particularly if they do not perceive an immediate return on investment.
Traders have to make, in a number of cases, substantial investments in order to obtain AEO
status and must continue to invest to maintain such a status. However, in return, Customs often
do not offer substantial benefits in the form of trade facilitation, which increases the cost of
trading. Consequently, the uptake of AEO programmes worldwide is slow.
- Limited incentives: In certain cases, the benefits and incentives provided by AEO programs may
not be compelling enough for some businesses. If the advantages, such as simplified customs
procedures, reduced customs inspections, or faster clearance times, are not perceived as
significant or relevant to a company’s specific circumstances, they may be less motivated to
pursue AEO status.
- Regulatory complexity: The complexity of customs regulations and requirements in different
countries or regions can also impact AEO uptake. If the regulatory landscape is unclear or
inconsistent, businesses may find it difficult to navigate the process and assess the potential
- Risk aversion: Some companies may be risk-averse and prefer to maintain the status quo rather
than undergoing the AEO certification process. They may be concerned about potential
disruptions to their supply chains or fear that increased scrutiny from customs authorities could
lead to delays or penalties.
What can be done to increase the level of AEO uptake?
To increase AEO uptake, governments and customs administrations can address these challenges by
providing better education and outreach programs to raise awareness, simplifying the application
process, reducing costs, offering additional incentives, and creating a more predictable and
harmonized regulatory environment.2
There may be need to consider extending invitations for automatic AEO status to some compliant
clients without the need to apply. This should be followed by effective incentives including less
scrutiny which is a major negative as most prospective candidates always say that the moment you
become an AEO you place yourself under spotlight with ZIMRA.
The AEO facility could also be expanded beyond the border where ZIMRA can enter into MoUs with
others e.g. SARS where AEOs in South Africa are automatically recognised as such in Zimbabwe and
vice versa. The facility can be extended further to as many players as possible within the whole supply
According to COMESA, 90% of businesses in the region are SMEs. This has a bearing on the ability of
firms to invest in the AEO programme. The requirements for qualification cannot be a one size fit-all.
It has to be situational. There is a need to review the AEO programme and develop one that meets the
needs of the SMEs otherwise in its current form, the AEO programme may be perceived to be for
multinational firms. What are the consequences of setting a bar too high for your local industry to
meet but good enough for firms trading from developed countries? Food for thought.
Article compiled by Elisha Tshuma from various internet sources. He can be contacted at
firstname.lastname@example.org or +263777850251.