BACK in 2017, TRA launched an international invitation for a tender to supply, install and operate a system for electronic tax stamps. The program was awarded to SICPA, a Swiss company owned by its founding family, not listed in the stock exchange.
The electronic tax stamp system became operational in 2018, but all the industries that were covered by the program (tobacco, wines, spirits, soft drinks and mineral waters among others) were complaining about the cost of the stamps that were to be purchased for each single product manufactured or imported.
According to rough calculations, between 2018 and 2021, SICPA collected almost 100 billion Tanzanian shillings annually, entirely paid by the industries (amounts finally paid by the consumers…).
Under industry pressure, and with the aim of finding a cheaper and more cost effective solution, in February this year TRA launched another invitation for tender, with the exact same specification of the tender launched in 2017. The 2022 tender has not yet been awarded despite the 120 days’ tender validity being expired.
Rumors at TRA has it that it will be awarded to the incumbent company (SICPA), and this news might not be well received by Tanzanian industries, especially knowing that SICPA owner has recently been put under investigation by the Swiss OAG for corruption.
According to the official source of judiciary information “Gotham City” (gothamcity. ch), Mr. Philippe Amon, SICPA SA’s owner and director, has now been included in an investigation into the company first opened by the Office of the Attorney General of Switzerland (OAG) in 2015. Extending the investigation to the “owner and current CEO of Sicpa” was decided in June 2021.
Philippe Amon is suspected of corruption of foreign public officials. He is still presumed innocent. The prosecutor’s office says its investigation concerns the alleged payment of bribes in various countries, “including Brazil and Colombia.” Initiating criminal proceedings against the CEO of a Swiss company for bribery of foreign public officials is extremely rare.
The extension of the investigation to Philippe Amon in June 2021 coincides with the announcement of a cooperation agreement signed by SICPA in Brazil, where the firm is involved in a major corruption case.
Under the agreement, which was announced on June 6, 2021, the Swiss-based company agreed to pay 135 million francs (325bn/) to put an end to the proceedings and obtain the right to participate in new calls for bids in Brazil. Authorities in Brasilia state that SICPA has “taken the initiative to request that the Federal Comptroller General (CGU) and the Federal Attorney General (AGU) negotiate a clemency agreement.” SICPA has “made available to the authorities’ information, documents, and evidence of the infringements uncovered during its internal investigation.”
The company also issued a press release on this subject on June 7, 2021. SICPA acknowledges its “strict liability” for “irregularities relating to certain payments”, but denies that “the contracts in question were obtained fraudulently.” According to the company, “no involvement, knowledge, or intent on the part of SICPA regarding these payments made in Brazil has been established.” It should be mentioned that the contract that brought SICPA under investigation in Brazil was not renewed by the Brazilian Tax Authorities.
All the equipment installed in the factories were deactivated and the beverage manufacturers had to revert to the old production accounting system.
Tobacco and beverage industry, as well as Tanzanian tax payers, are now looking at TRA, with the hope that there are no hidden costs behind the tax stamps and anxious to know the costs related to the new marking system.