The EU's southern watchdog

Michael Testa looks into the role of the Customs Department which, with Malta's accession to the European Union, has changed from a revenue-earner to a watchdog against illegal trade at the southern gate of the European Union.

"There is a good possibility that they (traders in counterfeit products) wanted to test us, to see if Customs was equipped to counter this illegal trade traffic," Customs director general John Mifsud said.

On May 1 last year, Malta Customs became part of the European Customs network of 25 countries, which function under the same laws and regulations.

This meant that Malta Customs was continuously in contact with its counterparts in EU countries exchanging information and cooperating to curb abuse.

"Malta is the ultimate external border of the EU and evidence shows that many of the counterfeit products seized here are destined for EU countries," Mr Mifsud said.

Per capita, Malta Customs have seized the largest number of counterfeit cigarettes in the EU over recent months.

Mr Mifsud said one had to keep in mind that Malta was a transshipment centre.

"We are part of a chain. It is a big challenge because manufacturers of counterfeit products are powerful and rich.

"The large volume of counterfeit goods directed through Malta may well be a test by the illegal operators to assess whether Customs here are adequately equipped to counter such trade," he said.

A case in point was when the government turned down an offer - on the advice of the Customs Department - by an Italian company to use Malta as its base to transfer Chinese goods, mainly clothes, to EU member states. It was a time when such products were limited by a quota to enter EU states.

Various Customs authorities in the EU have applauded Malta's efforts. An example was a letter from a leading clothes firm to Mr Mifsud, Alfred Cappello, director of investigations, and Iro Galea, director of enforcement referring to the seizure of counterfeit goods which stated:

"Through your efficient and hard work we believe that Malta Customs has demonstrated the highest level of professionalism and effectiveness in fighting illegal trade and smuggling onto the island and into other parts of Europe."

Customs' work is often featured in magazines of various Customs organisations such as Rilo of France, which refers to the seizure of counterfeit spare parts in Malta some months ago. The seized container was carrying different fake car parts such as bumpers, spoilers, front grills, horns and Peugeot emblems.

Rilo remarked: "Once again, it is seen that IPR (Intellectual Property Rights) items are not only aimed at fashion goods but also at safety items such as aircraft and car parts. There are untold possibilities, limited only by the imagination. For every item in demand, there is a risk of contravention of IPR, especially when there is an opportunity for the organisers to make a good profit."

As part of the EU Customs Organisation to which 164 countries belong, Malta Customs takes part in meetings designed to draw up an international policy on how customs operations should be modernised to become more affective.

A project by the World Customs Organisation lays down a framework of standards to facilitate and at the same time control the movement of goods. The aim is threefold: to combat the threat of terrorism; to further increase bilateral and multilateral cooperation between customs administrations around the world and to strengthen the partnership between Customs and the genuine business sector.

At the beginning of last month, Malta Customs was invited to attend a seminar on security of border controls in Frankfurt organised by companies producing security equipment such as scanning and X-Ray machines.

Despite problems and limitations of resources and finances, the Customs Department is giving priority to the training of personnel locally and overseas and to exchanges of officials with European countries. One such exchange will take place with the Dutch Customs Authority soon. The local department has also been asked to host a senior Customs delegation from Northern Cyprus to see what preparations the Maltese authorities had made prior to joining the EU.

Malta Customs has 430 operational officers grouped into two sections - those concentrating on the compliance aspect and others engaged in enforcement.

Mr Mifsud said that apart from the large hauls of counterfeit goods, smaller consignments of fake items intended for the local market were intercepted occasionally at the port by Customs.

Scanners are of great assistance but it is a trained eye that picks which cargo should be examined. It is here that the expertise of the officers plays an important part in detecting fake goods.

During Easter, Customs strengthened its presence and this produced the desired results as large consignments of counterfeit goods were detected. Easter time also marked one of the largest heroin hauls.

Mr Mifsud said that in certain cases, Customs may find it would be better not to intervene immediately when intercepting counterfeit products. Sometimes, when suspicion focuses on a certain container, it would better suit the purposes of the investigators to release it, with a message being sent to the Customs authorities in the recipient country. The general policy is to destroy all counterfeit goods.

Another example of the good work being done locally was the discovery of 2.3 kgs of drugs at Malta International Airport before Easter.

"We never saw such precision in the way the suitcase holding the drug was sewn to cover the false bottom. It was the most professional job we have come across.

The officer had a gut feeling that the weight of the case should be less than it actually was since it was empty. And his persistence paid off," Mr Mifsud said.

In this case Customs did not have any prior information about the drugs and there were no sniffer dogs. It was only the sharp sense of observation of the one of the junior officers that paid off.

Technology to detect illegal products is sophisticated and apart from the EU Customs Authority's support, Malta Customs also benefited from US government assistance in the training of personnel and in equipment to counter smuggling.

However, it is the wish of the Customs Department to obtain less bulky and more flexible equipment. In fact, the US authorities have already earmarked more equipment for Malta

Fake cigarettes seized recently in Malta had the banderoles of the countries they were heading for, namely France, Greece and Spain. It is hard to distinguish counterfeit packets from the original ones.

A reformed Customs

The word dwana (customs) is derived from the Arabic word diwan, a sofa where important public and private business was transacted in Islamic countries - this gives testimony to the international and universal vocation of customs activity.

Malta's membership of the EU required a major reform to upgrade and modernise the Department of Customs.

A business change management project aimed at improving practices in line with modern administrative principles especially those prevailing in the EU was undertaken. All the requirements have been met in accordance with the objectives of the project, thanks to the exceptional commitment of the staff. Through this ambitious project, Customs has managed and will continue with efforts to streamline procedures, to maximise compliance with fiscal obligations, to raise awareness and provide training activities.

Customs is a service department forming part of the Ministry of Finance and is one of the oldest serving government departments. It is responsible for the control of both imports and exports.

Simplified procedures, clear information, courtesy and professionalism in work have become essential tools in improving relations with customers, to build an image of an organisation at the service of citizens and to facilitate trade.

The large increase in world trade has placed additional burdens on Customs in its role of curbing illicit trade.

History

The foundation stone of Malta Custom House was laid in the sea at Grand Harbour just under the Lascaris Bastions in 1774.

The building, the work of architect Joseph Bonnici (1707-1779), is one of the very few government edifices that still serves the purpose for which it was constructed.

Custom House was officially inaugurated by the French Grandmaster Fra Emmanuel Marie de Rohan Polduc on July 27, 1776.

The Grandmaster was responsible for the completion of the building at his own expense.

Count Augustine Formosa de Fremaux was appointed Superintendent of Revenue or Vectigalibus Praefecto. A marble slab commemorating this event is affixed on the landing of the main staircase at Custom House.

The original marble slab on the entrance leading to the former Customs Long Room and facing the main staircase was damaged during World War II.

A multi-coloured inlaid marble slab with the coat-of-arms bearing the closed royal crown of Grandmaster de Rohan, kept in a Customs store room, is said to have been fixed along this marble slab.

The walls of Malta's Custom House, many up to four metres thick, were built up to first floor level with coralline limestone to resist the erosive effect of sea spray.

It is recorded that the façade overlooking Grand Harbour was decorated with the coat-of-arms in stone of the same Grandmaster with the figures of two mermaids on each side supporting a large frieze.

It is thought this coat-of-arms was obliterated along with many others by the French emperor Napoleon, with the remaining part eroded by the northeast winds.