RSL launches landmark reform

Move to regulate foreign trade agents and boost tax compliance

RETHABILE MOHONO

MASERU – In a bold move to enhance trade transparency and tax compliance, Revenue Services Lesotho (RSL) has officially launched the Agents of Foreign Firms (AFF) declaration process, effective July 1 this year.

The initiative marks a major step in formalizing Lesotho’s cross-border trade environment while empowering local agents and protecting national revenue.

The new system, developed in partnership with the Agents of Foreign Firms Association of Lesotho (AFFAL), is aimed at curbing long-standing issues of unregulated foreign trade practices that have plagued Lesotho’s economy. These include tax evasion, capital flight, and the exploitation of Basotho workers who have operated outside of formal labour structures.

For years, foreign exporters have used unregistered agents in Lesotho’s open market undermining tax laws and diverting earnings outside the country. Under the AFF reform, only licensed Basotho agents will be permitted to act on behalf of foreign firms, ensuring accountability and legal compliance.

“This is not just a tax measure – it’s a structural reform,” RSL stated in a press release.

“It empowers Basotho professionals, ensures fair labor practices, and strengthens the integrity of our economy.”

The AFF declaration process will be integrated into both the ASYCUDA World System and the Public Sector Revenue Management System (PSRM). These platforms will enable real-time monitoring of customs declarations, trade flows, and agent registration status.

Code 8294, a reserved provision in Schedule 34 of the Business Licensing and Registration Regulations, issued by the Ministry of Trade, Industry, and Business Development, backs the initiative.

The legal framework grants exclusive rights to indigenous Basotho to serve as agents for foreign suppliers, providing them with the authority to solicit orders, represent international brands locally, and appear as the sole recognised agents in all official trade documentation.

In addition, enforcement mechanisms will ensure that only registered agents appear in customs filings. Non-compliant entities will be systematically excluded from the formal trade system.

A Memorandum of Understanding between RSL and AFFAL, signed in June 2024, outlines the long-term cooperation between the two organisations and paves the way for continuous enforcement and policy refinement.

“This reform closes key loopholes that have long enabled informal trading and tax avoidance,” said the AFFAL leadership in a joint statement.

“It gives Basotho a central role in international commerce and protects our national interests.”

As Lesotho takes this significant stride towards a more structured, equitable, and locally empowered trading environment, the AFF declaration process is expected to become a model for trade governance and tax enforcement in the region.