Why travelling with more than Shs38m could land you in jail

For the last couple of days, several travellers jetting in or leaving the country have reported being inconvenienced by customs officials who ask them to declare hard cash on them.

Those who spoke to this publication about the situation describe it as “suspicious”, wondering why it is important to know how “much money they have on them.”     

It has, however, emerged that asking travellers at the customs points to declare hard cash they have with them is not only a global practice but also embedded in the law of the land.

According to the Anti-Money Laundering Act, 2013, as amended, a traveller entering or exiting the country should declare hard cash, in this case, any amount exceeding $10,000 or Shs38m going by the current dollar bill exchange rate.

As a result, travellers leaving or entering the country with hard cash amounting to more than $10,000 could be liable to criminal prosecution if they did not declare the money at the customs point and are caught, according to the Financial Intelligence Authority (FIA).

When contacted on Thursday, Ms Esther Aikiriza Kagira, the officer-in- charge of compliance at FIA – the money laundering prefect in the country, said it is not illegal to have on you hard cash of more than $10,000, but it is a crime not to declare at the customs point.

She said: “According to section 10 of the Money Laundering Act as amended, a traveller who comes in or gets out of the country has to declare to customs, in this case URA, in a form which the traveller will be required to fill and then share with us – FIA.”

She continued: “You are free to have as much money on you as possible. This is because it is not illegal to have more than $10,000 on you. The only requirement is for you to declare it as long as it is cash. And this is not just a Ugandan thing. It is an international requirement. If you get caught, you will face the law because having that amount on you is a crime if you haven’t declared it. In Uganda, this procedure is mandated by Section 10 (1) and Regulations 10(1) (a) and (b) of The Anti-Money Laundering Act of 2013.”

Rationale

Ms Aikiriza said this is a move towards fighting money laundering, whose proceeds tend to, among other things, finance terrorism activities. 

“This standard global practice at the border is aimed at combating money laundering and terrorism financing, and again, I am stressing that having that amount of money is not illegal but could raise suspicion if you don’t declare it.”

This procedure, which has been in place for a significant period, is not a tax and it doesn’t attract any levy even upon and after being declared.

All that is required is a declaration to be made to URA customs at the border point and then shared with the anti-money laundering prefect- FIA.

In a statement shared by URA, the tax body notes that this long-established protocol is mandated by law and is a standard global practice that promotes transparency and accountability in financial transactions.

As a result, asking travellers to declare more than Shs30m at customs points is not only normal but will continue to be the case.

“To promote transparency and accountability in financial transactions, the Government of Uganda has implemented a routine procedure that applies to individuals entering or departing the country with negotiable bearer instruments or cash equal to or exceeding 1,500 currency points - where 1 currency point equals Shs20,000,” reads the statement.

URA in a statement further said: “Effectively, any money equal to or in excess 1,500 currency points will constitute a restricted good requiring the owner to make a declaration to Customs, which implies that the owner is supposed to pass through the red channel.”

Convenience

Whereas travellers regard this declaration process as inconvenient and suspicious, URA and FIA say the process has been designed to be efficient and user-friendly for travellers.

Departing passengers are required to complete Form C (blue form) while arriving passengers are required to complete Form D (yellow form).

They are then expected to submit the completed form to a URA Customs officer, along with copies of their passport.

The officer verifies the declared amount without handling the funds directly, ensuring the non-invasive nature of the process.

“The declaration process can be completed within 15 to 20 minutes, and the traveller is then permitted to proceed with their funds. Upon submission, Customs forwards the declaration forms to the Financial Intelligence Authority (FIA) for analysis and advisory purposes. Throughout this process, confidentiality is maintained with utmost diligence,” indicates the statement

Should the FIA find any indication that the funds could be financing criminal activities, it assumes full control of the investigation.

These streamlined efforts, according to URA and FIA, reflect Uganda’s unwavering commitment to promoting a transparent and equitable economic landscape at border exits, in compliance with international standards at a time when Uganda has just been struck off the grey list, saving its financial sector from being isolated in international financial transaction.

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