Tuesday 26 November 2013

Govt to finalise alcohol import rules

While the government’s investigation into illegal alcohol import continues to see thousands of bottles of alcohol seized, hefty fines to importers and a possible shortage of alcoholic drinks in Myanmar, plans are afoot to allow proper import before the end of the fiscal year.

For years, there has been a limited ban in place on imported items such as preserved foods and alcohol meant to protect local producers, but some of those blacklisted items, including wine, have quietly been allowed into the market in past years. Some traders, meanwhile, simply channeled such goods through the black market.

But now, an investigative committee formed within the Ministry of Commerce to tackle illicit alcohol imports last year has resulted in the confiscation of thousands of bottles of wine and spirits, said U Win Myint, director of the Ministry of Commerce’s Directorate of Trade.

“Currently, we are able to seize any alcohol in any case where we are getting information,” he said.

“There are uncountable numbers of illegal traders and alcohol sales in the local market and shops,” he said.

Though established last year, U Win Myint claims the ministry taskforce remained largely inactive until September, when they discovered and confiscated 500 cases of illegal alcohol from local traders.

He said it was only then that the issue was brought up to parliament and a country-wide crackdown was approved.

“[We] suggested to the lower house of parliament that action be taken against illegal traders who refuse to levy tax, and the president backed the proposal,” he said.

According to an official on the Illegal Trade Prevention and Supervision Control Committee, officials on September 18 seized nearly 89,000 bottles of whisky, wine and beer from Greenline Myanmar Group (GMG), a local distributor based in Yangon’s Dawbon township.

On October 8, over 2500 cases of various alcohols were seized from the warehouse of an individual importer in Bayintnaung bus compound, while at the same time 45,552 cans of beer were taken from a warehouse in Shwe Pyi Thar industrial zone 2.

In the most public bust to date, the ministry taskforce on October 28 confiscated 30,000 bottles of various wines and about 2400 cans of beer from Yangon-based Quarto Products, one of the largest distributors in the country, claiming the distributor illegally imported US$620,000 worth of wine using an unauthorised licence.

But it did not stop there. In the most recent case last week, 2160 bottles of whisky and rum were taken from a bus at Aung Mingalar bus station in North Okkalapa township.

“The cases for GMG and Quarto are using hotel licences. We don’t allow any alcohol products to be sold by outside entities apart from certain hotels and duty-free shops,” U Win Myint said, adding that GMG and Quarto were importing from overseas suppliers, while alcohol was being smuggled through the Myawaddy border in the other cases.

He said that while the investigation was ongoing, persecution would be limited to illicit traders, but not the shops and restaurants where illegal products are being sold.

Confiscated goods are then auctioned into the local market with tax labels attached.

In the meantime, the government is working on a resolution to implement a more open and competitive import policy regarding alcohol.

“It might be passed around December and at the latest in March,” U Win Myint said.

“We have plans to open [the alcohol trade], but we have to discuss it with international organisations and other departments,” he said. “That’s why we cannot decide immediately.”

U Naung Naung Han, general secretary of the Myanmar Travel Association (UMTA) and a member of the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI), said that the legislation for legal imports should be passed sooner rather than later in order to fill the current supply gap for alcohol in the market.

“There is a shortage of valuable wines and other alcohol. If something does not change, it will get worse when demand is going to grow during the SEA Games,” said U Naung Naung Han said.

According to the Internal Revenue Department, tax on legally imported alcohol is high at about 50 percent or higher depending on the type, while customs and transportation fees also have to be applied.

“The smuggled products are much cheaper than legally imported products, but we don’t know about their quality,” U Naung Haung Han said.

U Ye Min, manager of Sedona Hotel’s food and beverages department, said that larger hotels will likely not feel the pinch from the recent busts as they have ample stocks in reserve.

“We have another five or six suppliers, not just Quarto and GMG, or we can buy them urgently at the supermarket if we need to.”

source: The Myanmar Times

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