If you export into Lesotho and do not have a registered local presence, you will generally need to transact through a licensed Agent of a Foreign Firm. Since July 2025, customs now requires an AFF declaration and the agent’s code on documentation; the activity is reserved to eligible Basotho agents under Lesotho’s business‐licensing framework.
What is an “Agent of a Foreign Firm”?
An Agent of a Foreign Firm (AFF) is a Lesotho-based representative appointed by an overseas supplier to solicit orders, represent the principal, and facilitate cross-border sales into Lesotho. In 2025 the Revenue Services Lesotho (RSL) formalised an AFF declaration for customs processing, and policy updates emphasised that acting as an agent for foreign exporters is a reserved activity for Basotho agents licensed under the Business Licensing and Registration Act, 2019 and its Regulations.
When must you use an AFF?
- Exporting into Lesotho without your own registered entity: Use a licensed Basotho agent and ensure they hold the AFF certificate/agent code recognised by RSL for customs clearance. The agent code must appear on export and clearing documentation.
- If you establish a local footprint: Foreign companies that open a place of business in Lesotho must register as an external company under the Companies Act, 2011 within the prescribed timeframe, in which case you may not need an AFF for sales you perform directly.
Legal and regulatory anchors
- Business Licensing & Registration Act, 2019 (and 2020 Regulations): Provides the licensing framework and reserved activities, administered via the Ministry of Trade/OBFC. Agents of foreign firms fall within this regime.
- Companies Act, 2011: Enables registration of external companies for foreign principals who wish to trade directly.
- RSL AFF regime (2025): Introduces the Agents of Foreign Firms declaration and operational rules for customs processing.
- Customs practice: Export documentation must align with RSL requirements; an AFF certificate/agent code is used by clearing agents to ensure compliance.
Step-by-step: How to appoint and onboard an AFF
- Select a qualified Basotho agent. Confirm they are licensed under the Business Licensing and Registration framework and are eligible to act as an agent for foreign exporters.
- Conclude a written agency agreement. Define territory, product scope, exclusivity (if any), pricing authority, compliance, AML/CFT undertakings, and termination mechanics. (Best practice informed by RSL and trade guidance.)
- Ensure the agent holds an RSL AFF code/certificate. The agent registers with RSL; the AFF code is then provided to your customs broker and appears on invoices and customs documents linked to your exports into Lesotho.
- Decide on your operating model.
- Through an AFF only: You remain offshore; the agent handles representation and declarations.
- External company: If you open a place of business, register an external company (Form 3) with the Registrar (OBFC) and align licences accordingly.
- Align customs & tax compliance. The importer must hold an importer’s code with RSL; permits may be required for restricted goods. Your AFF and clearing agent coordinate the paperwork for border clearance.
Practical drafting points for an AFF agreement
- Regulatory compliance clause: Warrant that the agent is duly licensed and maintains the AFF certificate/agent code throughout the term; require immediate notice of changes.
- Customs & documentation: Allocate responsibility for ensuring the agent code appears on all invoices, credit notes, and customs entries related to your Lesotho sales.
- Competition & exclusivity: Define whether the agent may represent competitors and set performance thresholds tied to exclusivity.
- Anti-bribery/AML: Incorporate compliance with Lesotho law and your home-jurisdiction policies; provide audit and training rights.
- Termination for regulatory cause: Immediate termination if the agent loses licence or AFF status.
- Indemnities & insurance: Address third-party claims arising from mis-declarations or non-compliance at the border.
External company vs. AFF: which route?
- AFF route suits exporters who prefer not to register locally but need compliant representation for solicitation and customs.
- External company suits principals planning sustained on-the-ground operations (staff, office, inventory). External companies must be registered under the Companies Act, 2011 and will interact with the licensing/tax system directly.
Consequences of non-compliance
Failure to use a properly licensed Basotho agent or to present the AFF declaration/agentcan lead to clearance delays, rejection of entries, or sanctions under customs rules. RSL’s 2025 policy statement highlights the formalisation of the AFF process and the expectation that agents be duly licensed and recognised in customs declarations.
Quick checklist (exporter)
- ✅ Written agency agreement with a licensed Basotho agent
- ✅ Agent’s Business Licence (current) under the BLRA framework
- ✅ RSL AFF code/certificate on file and shared with your clearing agent
- ✅ Invoices and customs documents bearing the agent code
- ✅ Importer’s RSL importer code (where you or your Lesotho buyer imports) and any sector permits for restricted goods
Key references
- RSL Press Statement (June 2025): Launch of Agents of Foreign Firms (AFF) declaration process.
- RSL Foreign Agents portal: Information and applications for foreign agents/related services.
- Business Licensing & Registration Act, 2019 and Regulations, 2020.
- Companies Act, 2011: External company registration (Form 3).
- Customs documentation practice: AFF certificate/agent code in declarations.
Need help appointing an Agent of Foreign Firms in Lesotho or drafting a compliant agency agreement?
Mayet & Associates can prepare agency contracts, license applications, and customs-ready documentation tailored to your product line and distribution model, and guide you on whether to remain offshore via an AFF or register as an external company.