Standard General Insurance Company Limited v Commissioner for Customs and Excise

Gem Shipping (Pty) Ltd, a licensed clearing agent, entered goods for export in bond from a customs warehouse in Durban to Zambia without payment of customs duty, relying on a special removal bond executed by Gem and its surety, Standard General Insurance Company Ltd. The Commissioner permitted removal on the basis that the goods would be exported outside the common customs area. Gem failed to prove within the prescribed period that the goods left the common customs area and failed to comply with its declarations. Gem was liquidated in May 1993. The Commissioner demanded payment of duty and later sued Standard General as surety. Standard General raised a special plea that the Commissioner’s claim had prescribed under the two-year time-bar in section 99(5) of the Customs and Excise Act 91 of 1964.

The appeal was dismissed. The special plea of prescription raised by Standard General Insurance Company Ltd was correctly dismissed, and Standard General remained liable as surety for Gem Shipping’s unpaid customs duty.

The case is significant for clarifying that the two-year time-bar in section 99(5) of the Customs and Excise Act applies only to agent liability under section 99 and not to liabilities arising under other provisions such as section 18A or under contractual instruments like customs bonds. It also confirms a broad, purposive interpretation of 'exporter' under section 18A to include clearing agents acting on behalf of exporters, reinforcing the Commissioner’s ability to secure payment of customs duty.