OMAP Warns FBR Customs Rule Threatens Fuel Supply, Prices

ISLAMABAD: The Oil Marketing Association of Pakistan (OMAP) has issued a stark warning that the Federal Board of Revenue (FBR)’s new customs clearance deadlines threaten to destabilize Pakistan’s petroleum supply chain, pressing for an exemption for petrol and diesel imports to avert fuel shortages and price hikes.

In urgent letters to the Ministry of Finance, FBR, and Federation of Pakistan Chambers of Commerce and Industry (FPCCI), OMAP criticized the rule, enacted under the Customs Act 1969, which mandates Goods Declarations (GDs) within 20 days of vessel arrival—a timeline deemed incompatible with petroleum logistics.

OMAP Chairman Tariq Wazir Ali underscored that petroleum imports operate under a tightly regulated, time-sensitive framework involving the Oil and Gas Regulatory Authority (OGRA), Petroleum Division, and port authorities. He highlighted that pricing for motor gasoline and high-speed diesel is finalized 15–20 days post-discharge, rendering compliance with the 20-day GD deadline unfeasible.

OMAP cautioned that the rigid rule could trigger procedural delays, demurrage costs, and penalties, potentially inflating retail fuel prices by up to Rs3 per litre. Such costs could deter investment in fuel import and storage infrastructure, undermining energy security goals.

The association noted that petroleum consignments are stored in public bonded facilities, not congested port terminals, meaning delayed GD filings do not affect port efficiency. Moreover, Section 98 of the Customs Act allows 180 days for duty and tax settlement, rendering the rule’s fiscal rationale redundant.

OMAP appealed to the FPCCI to advocate with the FBR and Ministry of Finance to shield the petroleum industry from operational disruptions. It warned that blanket enforcement risks destabilizing Pakistan’s fuel import and distribution network, critical for economic stability.

The association proposed solutions: exempting petroleum products from the rule, extending GD filing to at least 40 days for fuel consignments, reinstating provisional GD filing from the One-Customs system, and increasing non-fuel import clearance (e.g., lubricants, equipment) from 5 to 10 days.

OMAP reaffirmed its commitment to compliance and cooperation but urged flexibility. Chairman Ali expressed optimism that the government would address concerns pragmatically, emphasizing the need for policy coordination among the FBR, Petroleum Division, and OGRA to sustain investor confidence and fuel supply continuity.