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Car dealers threaten to leave

Business

Nthatuoa Koeshe

The Import Car Dealers Association of Lesotho (ICDAL) said they are ready to leave the country if the Minister of Trade and Industry is not ready to deal with foreigners or car dealers in Lesotho.

This after the Minister Dr Thabiso Molapo labeled their turf a ‘hub of money laundering and terrorism’ as he attempted to clear the air on the newly enacted rules governing motor vehicle dealership, the Business Licensing and Regulations N0.71 of 2020.

The new legal instrument depicts a hike in motor vehicle trading licensing fees by up to 12 500% from M600 to M150 000 an announcement which had understandably brought about misunderstandings among stakeholders.

ICDAL claimed not to have agreed terms with the ministry in reaching the new rates which they scoffed at for being unreasonable and for being introduced without prior communication.

“If the minister does not want foreigners or car dealerships in Lesotho then we do not have a problem with that. We are ready to leave,” they said adding that they however ask for a three year grace period to wrap up and go.

They said the increment of fees will not help the car dealers or the government of Lesotho as it will only make investors in Lesotho leave.

“This rate of increment of fees is not the way to go as it will only chase away investors thus impacting the international markets as well,” they said.

The traders especially raised issue with the minister’s remarks which they said are unfounded and meant to paint them in bad light by baseless allegations.

Last week, Molapo lashed at the motor dealership industry for being identified as a high activity hub for money laundering.

Molapo had said Lesotho is a member of Eastern and Southern African anti-money laundering group and thus has an obligation to combat money laundering in the country.

“The motor dealer industry has been identified as a high activity hub for money laundering and the Ministry of Trade and Industry is responsible for monitoring this industry to combat the activities such as these ones,” he said.

Meanwhile, the ICDAL accused Molapo of levelling unproven and vague allegations against them, saying there is no proof that they have been involved in these kinds of activities.

“There have not been any cases of money laundering and there is no proof of these activities at all. These are just baseless allegations. This accusation has made us insecure because now our clients think these are the kind of things we do yet there has not been any case of those activities at all,” they said.

Though last week the minister told the public that they met with the importers association to review the conditions given after the regulations, the association said there had been no meeting or communication at all between them and the government and the announcement of the increment came as a shock to them.

“The ministry was recalled to review the conditions and so we invited those who were complaining being the association of imported cars for talks and met with the car importers association on the 16 December 2020 and listened to them,” Molapo said last week adding that at the end of the discussion the association agreed that the licence fee is set at M150 000 per annum and in consideration of the concerns by other members of the public and enterprises, the ministry revised the conditions and the amended 2020 regulations were published in September 2021.

Meanwhile, the Lesotho Mounted Police Service (LMPS) as well as the Directorate on Corruption and Economic Offences (DCEO) have not confirmed any cases of money laundering in the motor vehicle trade, while the Lesotho Revenue Authority (LRA) said it could not verify or deny requisite tax compliance by the motor trade as an industry but that the traders operated as individual entities with different compliance practices.

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