Company loses fertiliser tariff appeal over missing data

Tribunal upholds decision by the Commissioner of Customs and Border Control /FILE

An agribusiness firm has lost a bid to overturn a ruling on the classification of its liquid fertiliser after the Tax Appeals Tribunal found it had failed to disclose the full contents of its product.

Plantcare Chemical Industries Limited had challenged a decision by the Commissioner of Customs and Border Control to reclassify its import, KARA Green, under a different code from the company’s preferred tariff for mineral or chemical fertilisers.

At the heart of the dispute was whether the product should be classified as a chemical fertiliser under Chapter 31 of the East African Community Common External Tariff or as a miscellaneous chemical preparation under Chapter 38.

Plantcare argued that its product qualified as a straightforward fertiliser, citing laboratory results that showed a nitrogen content of approximately 18 per cent.

The company contended that, under the General Rules of Interpretation, the nitrogen gave the goods their essential character, making tariff code 3105.90.00 the most specific and appropriate classification.

The respondent, however, maintained that KARA Green was better described as an agricultural nutritional product containing amino acids and micronutrients.

In a judgment delivered on February 25, a four-member tribunal panel dismissed the appeal, noting that the technical data sheet provided by Plantcare accounted for only a fraction of the product’s composition.

The appellant had argued that the product’s 18 per cent nitrogen content gave it its essential character, while the remaining micronutrients, such as iron and zinc, were merely peripheral. However, with the majority of the formulation undisclosed, the tribunal found it impossible to verify this claim.

The tribunal observed a significant gap in the technical data provided by the appellant, noting that the analysed elements accounted for only about 25.5 per cent of the product's weight.

“The information provided by the appellant to support its argument that nitrogen is the essential constituent of its product falls short of the evidentiary burden placed on it, to the extent that it has concealed data containing the majority constituent elements of the product.”

Laboratory analysis conducted by the respondent confirmed the presence of nitrogen, iron and zinc, but the absence of a full compositional breakdown proved fatal to the appellant’s case.

The tribunal concluded that the commissioner was justified in classifying the product under the more general heading for chemical preparations, given the limited information provided.

“The appellant had a duty under Section 30 of the TAT Act to provide this information to help the Tribunal have a view of the entire constituent elements that make up this product. This way, it would have been possible for the Tribunal to determine what constituted the essential constituent of this product,” the panel observed.

The tribunal upheld the commissioner’s review decision dated June 23, 2025, and ordered each party to bear its own costs.