Pact signed with Saudi Arabia to share trade data

Updated September 04, 2019

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FATF says that narcotics, smuggling, under and over invoicing are the primary sources of illicit financial flow. — AFP/File
FATF says that narcotics, smuggling, under and over invoicing are the primary sources of illicit financial flow. — AFP/File

ISLAMABAD: Pakistan and Saudi Arabia have formally agreed to exchange values of goods for imports and exports to control of under and over invoicing as part of Financial Action Task Force’s (FATF) recommendation.

Saudi Arabia will become Pakistan’s 23rd major trading partner with whom the country will formally into an agreement to monitor and control illicit financial flows and currency smuggling as part of the recommendations of money laundering watchdog.

The FATF has recommended that narcotics, smuggling, under and over invoicing are the primary sources of illicit financial flows (IFFs), which is inherently a global phenomenon. Over invoicing is a serious threat and a tool used for whitening of black money.

Pakistan already has agreements in places with 22 countries, including the USA, China, Malaysia, UAE etc for online sharing of information on real-time basis to curb under and over invoicing.

On Tuesday, a five-member delegation of Saudi Customs Authority, led by Deputy Governor of Security Affairs Muhammad AlNuaim, held discussions with Pakistan’s top customs officials under Federal Board of Revenue (FBR) Chairman Shabbar Zaidi to discuss matters of mutual interest.

Both sides agreed to exchange of information on real-time basis regarding values of goods originating from both countries, along with sharing experiences in law enforcement domain and explore avenues of future cooperation in areas such exchange of intelligence-based information to crack down on illicit flow of currency.

The two states will also share profiling of advance passenger information; encourage cooperation between both Customs to arrest senders and recipients of drugs; post seizure and arrest investigations; designation of contact officers for mutual cooperation and capacity building for automation/harmonisation of customs procedures.

Member Customs Operation Jawwad Agha gave details of the National Single Window (NSW) and National Targeting Centre (NTC) and how these initiatives provide complete frameworks for intra-agency cooperation in Pakistan. The delegation was apprised that at national level, Risk-Based Mitigation Secretary (RBMS) has been evolved after taking due input from all stakeholder agencies including the Federal Investigation Agency (FIA), Anti Narcotics Force, Airport Security Force and Pakistan Customs.

Under RBMS, a completely new institutional apparatus has been set up with a dedicated directorate, namely Cross Border Currency Movement within the Directorate General of Customs Intelligence and Investigation to address the risks of cash smuggling.

Both sides also unanimously agreed that there exists huge scope for enhanced cooperation which will help them address a wider range of problems originating from currency smuggling, narcotics and mis-declarations.

Published in Dawn, September 4th, 2019