Page 13 - AfrOil Week 11 2020

AfrOil POLICY AfrOil
Engen is one of the top sellers of motor fuel in Zimbabwe (Photo: Zimbabwe Mail)
ZERA responds to criticism
of new licensing requirements
ZIMBABWE
THE Zimbabwe Energy Regulatory Authority (ZERA) has pledged to revise new licensing requirements for retail sellers of refined fuels, following complaints from one of the biggest players on the domestic petroleum product market.
Late last week, ZERA backed down from plans to hike licensing fees to as much as $2mn and require all applicants to produce a perfor- mance bond with a value of $30mn. It did so after the Indigenous Petroleum Association of Zimbabwe (IPAZ) filed a protest against the new policy in court, naming the Energy Ministry and ZERA as co-respondents.
ZERA responded formally to the court challenge in a statement dated March 13. “Fol- lowing submissions from stakeholders in the petroleum sector ... ZERA hereby makes the following statements: Section B of the said Notice which refers to procurement licences is hereby withdrawn to allow ZERA to fully con- sider the representations made by petroleum sector stakeholders,” it said. “Revised procure- ment licence conditions will be published in due course,” it said in a statement dated March 13.
IPAZ has criticised the new regulations, which were introduced earlier this month, as burdensome.
In its announcement unveiling the new pol- icy regime, ZERA said that applicants would need to pay a fee of $1.53-2.00mn and meet
other conditions pertaining to its financial sta- tus and its business operations.
Among other things, the government agency said that it would not grant licences to applicants that could not show that they owned at least 25 retail outlets, each in a different province, with no more than two of the total number accepting payment in foreign currency.
IPAZ was particularly critical of this require- ment, alleging that it was designed to drive small fuel sellers such as its own member companies out of business.
The group also complained about ZERA’s demand that each applicant for a licence pro- duce a performance bond with a value of $30mn. It called this rule unfair, explaining that it would have a difficult time meeting the standard since it was receiving only 1.7% of the government’s monthly support allocations of $120mn, despite the fact that its members account for 42% of Zimbabwe’s fuel sales.
IPAZ includes 77 locally based fuel retailers that banded together with the aim of securing more financial support from the government. Collectively, these retailers are among the six largest fuel importers in Zimbabwe
The other five are Engen Petroleum Zimba- bwe, Petrotrade, Puma Energy, Total Zimbabwe and Zuva Petroleum. Unlike IPAZ, all five of these companies are capable of meeting ZERA’s new requirements. ™
Week 11 18•March•2020 w w w . N E W S B A S E . c o m P13