EBN Trading (Pty) Ltd v The Commissioner for Customs and Excise and Another

EBN Trading (Pty) Ltd (EBN) acted as a financier in transactions involving the importation of video cassette recorders (VCRs) into South Africa in 1995. The goods were manufactured by Daewoo in Korea, procured by a Hong Kong company, Dragon Best Investment Ltd, and ultimately delivered to South African retailers Pick ’n Pay and Tom Distributors. EBN arranged letters of credit through Absa Bank to fund the transactions, obtained possession of bills of lading endorsed in blank, received delivery of the goods, invoiced the retailers, and was paid by them. The goods entered South Africa under false bills of entry indicating Zaire as the destination, thereby evading customs duty. Customs authorities detained other goods linked to EBN as security for unpaid duties amounting to over R4.4 million. EBN sought release of the detained goods, arguing that it was merely a financier and not an ‘importer’ liable for customs duty.

The appeal was dismissed. The finding of the Natal Provincial Division that EBN was an ‘importer’ liable for customs duty was upheld, and Customs was entitled to retain the detained goods as security.

The case authoritatively interprets the extended definition of ‘importer’ in the Customs and Excise Act, confirming that financiers who structure transactions so that they derive security, control, or commercial advantage from imported goods may be liable for customs duty. It underscores that liability is determined by substance and contractual rights, not merely by labels such as ‘financier’.