Simbarashe

15 November 2013,

When you travel around Zimbabwe, you will notice there are places were you have to really search to get a service station. That definitely means the fuels industry still has a lot of opportunities. The fuels industry can be split into two major classes namely retail and wholesale. I shall focus on retail fuel trading in this article.

To operate as a fuel reseller, one has to be granted a license by the responsible authority. There are several steps to be followed to acquire a license. The issue of premises can be circumvented by renting a service station. Like electricity, fuel is energy and as such it falls under the Energy Ministry’s Zimbabwe Energy Regulatory Authority (ZERA). At this point, you may discard this page and go directly to ZERA and get first hand communication from them.

Zimbabwe promotes formal business structures and as such, your business should be registered in accordance to the laws of Zimbabwe. I wrote a separate article on how to register a company. For this venture, you have to ensure that 51% of the shareholding is held by Zimbabweans. Foreign investors can only invest up to 49% at the moment. This provision by the government was as result of a drive to promote local business whilst striking a balance with foreign direct investments.

The next step for your fuel retail business is to provide a clear management structure. This can be presented diagrammatically through an organizational chat. A profile of your management should also be included. Management profile has information like full names qualifications and experience to name a few. The easiest way is to create a company profile or find someone who can do that for you. It will capture all the required information.

A licensee must be a Zimbabwean registered organization. The organization should have the relevant company registration and tax documents like CR14 and CR2 forms. Because of the nature of fuel retail business, it has to be regulated well. For one to be able to obtain a license, s/he has to provide verifiable details of physical address, telephone numbers, faxes and any other contact details.

A retail fuel license is not universal. It has to be site specific. A certified copy of title deeds or lease agreements for the retail site should be supplied. Thus if one finds another site to operate as a fuel retailer, this step has to be followed again. Basically setting up a service station is influenced by two major authorities namely ZERA and Local Authorities. One has to also attain a Local Authority License. Thus without a certified copy of a Local Authority License, ZERA cannot issue you with a license to operate a fuel retail business. One of the major risks assessed by the respective authoritative boards is : Are the premises of operation offering sufficient facilities to prevent fire outbreaks? If no, you will not get your fuel retail business license till you rectify the arrears.

Your next stop in pursuing a fuel resale license is at the Environmental Management Agency. These guys will offer you the Hazardous Substance license. As a fuel reseller, you are mandated to pay an annual license to ZERA. Like I explained above, ZERA are the regulators of the Energy business. A visit to their offices will expose a lot of business opportunities in the b\energy sector in Zimbabwe.

Once you start operating, there is no going back. Besides paying your fuel retailor license, you will have to keep all your purchases and sales records. This is easier when you employee an accountant or book keeper do your books. ZERA as the regulator of the Industry has the right to request for any other information they deem necessary to grand you your license.

These conditions are subject to amendments and reviews by Zimbabwe Energy Regulatory Authority in light with operational experiences and other circumstances.

Most importantly, the license holder undertakes to declare that all the information provided to the Authority in support of the application for this license is correct to the best knowledge of the license holder, whether or not confirmed by the Authority or its appointee. Should any fact be subsequently proved to be incorrect, the license shall be deemed invalid forthwith and the Authority reserves the right to take any further remedial action as it deems necessary