Companhia Industrial da Matola (CIM) has challenged the suspension of its wheat and rice import operations, announced by the Mozambique Grain Institute (ICM), describing the measure as “legally inadmissible” because it results from what CIM considers to be “an unlawful monopolistic regime for cereal imports”.
The issue concerns the suspension, announced on Tuesday, of three rice and wheat importers by the ICM for an indefinite period, including CIM, over alleged irregularities. The decision resulted in the seizure of thousands of tonnes of these grains.
READ: Mozambique Grain Institute suspends CIM, África Indústrias and Pembe from importing rice and wheat
“CIM rejects the legality of the indefinite suspension announced by ICM. The legal framework allegedly applicable establishes specific requirements for the suspension of activities and provides that any sanction must be preceded by a hearing of the alleged offender and the opportunity to exercise the right of defence,” states a communiqué from the Mozambican company.
The company alleges that it was not notified in advance of any infringement proceedings that could justify such a suspension, was not heard beforehand, and was not given an opportunity to respond to the allegations. It therefore considers that the legally required procedures have been violated.
On Tuesday, the Mozambique Grain Institute announced the suspension of the import activities of CIM, Africa Indústrias and Pembe Mozambique, citing “irregular imports” without the entity’s required authorisation.
According to the institute, the measure resulted in the seizure of 34,300 tonnes of grain, including 3,300 tonnes of wheat attributed to CIM, unloaded through the Port of Matola.
In today’s communiqué, CIM also disputes the classification of the operation as an irregular import, arguing that the goods complied with all customs procedures required by the Mozambican authorities.
“The import was submitted to the applicable customs procedures, and the Mozambique Customs Authorities expressly authorised the discharge of the 3,300 tonnes of wheat,” CIM states. “The corresponding customs documentation was issued and the charges reflected in the import declaration were processed.”
The company argues that the dispute with the ICM is not related to the legality of the imported cargo, but rather to the new grain import mechanism implemented by the institute this year.
It further maintains that legal proceedings are under way before the administrative courts seeking a declaration that the provisions used by the ICM to impose what it describes as an “unlawful monopolistic regime” are null and void.
CIM argues that the mechanism constitutes an unlawful monopolistic regime incompatible with the rule of law, adding that the ICM has reportedly already been formally served in the proceedings concerned.
The Companhia Industrial da Matola maintains that, despite the matter being considered by the courts, the Mozambique Grain Institute made the unloading of the goods conditional on the submission of additional documentation relating to the contested mechanism.
“In this context, CIM considers the intervention that occurred during the vessel’s discharge, aimed at making the operation conditional upon the presentation of additional ICM documentation, to have been legally unjustified,” it states.
CIM further says that this intervention caused “additional costs and losses to the operation”, reserving the right to seek compensation and hold those responsible for the decision accountable.
“CIM’s position is clear: it cannot be compelled to participate in a mechanism whose legality it is challenging before the courts when such participation effectively requires CIM to bear a charge that it likewise disputes,” it maintains.
The ICM previously justified the centralisation of rice and wheat imports on the grounds that it was necessary to combat alleged over-invoicing practices which, according to the institution, cause estimated losses to the State of around US$100 million (€89.1 million) a year.
According to the Mozambique Grain Institute, the new model is also intended to allow greater control over the use of foreign currency in the country. The mechanism came into force for rice in February and for wheat in May this year.
