Customs News Bulletin

14 October 2013

 

Latest International Trade News

 

From time to time certain government departments publish draft legislation to inform stakeholders about their intention to amend legislation, and to invite comments. The commentary period ranges from 2 week to longer periods, depending on the urgency of the matter.

The Bulletin focuses on the publication of information relating to such matters which impact on Customs and Excise legislation and on broader import and export legislation.

 

DRAFT AMENDMENT OF SCHEDULE NO 6 PART 3, NOTE 6 (f) (iv)

(Comments due 30 October 2013)

Note (f) in Part 3 of Schedule No 6 deals with mining on land: Refunds of levies on eligible purchases for distillate fuel for mining as specified in paragraph (b)(i) to this paragraph.

The proposed amendment aims to exclude mining for sand, rock, stone, soil (excluding topsoil), clay, gravel and limestone as mining activities, except through quarrying. Dredging, surface collection and underground operations are excluded.

Download the documents from the SARS website at http://www.sars.gov.za/Legal/Preparation-of-Legislation/Pages/Draft-Documents-for-Public-Comment.aspx.

 

 

DRAFT TARIFF AMENDMENTS EFFECTIVE FROM 1 JANUARY 2013

(Comment due on 29 October 2013)

 

The South African Revenue Service published various draft notices which will give interested parties an indication of what is in stall for 2014.

 

Draft Tariff Amendments including the proposed amendments to implement the EFTA phase-downs for 2014 with effect from 1 January 2014:

         Explanatory Memorandum

         Draft amendment of Part 1 of Schedule No. 1 to implement 2014 phase-downs

         Draft amendment of Part 1 of Schedule No. 2 to replace 6-digit commodity codes with 8-digit commodity codes

         Draft amendment of Part 2 of Schedule No. 2 to replace 6-digit commodity codes with 8-digit commodity codes

         Draft amendment to delete Note 8 in Schedule No. 3

         Draft amendment to delete Note 5 in Schedule No. 4

         Draft amendment to delete Note 14 in Schedule No. 5

 

These amendments relate to the annual phase-downs and all proposed amendments are explained in the attached Explanatory Memorandum.

 

 

Download the documents from the SARS website at http://www.sars.gov.za/Legal/Preparation-of-Legislation/Pages/Draft-Documents-for-Public-Comment.aspx .

 

PROPOSED REGULATIONS TO PHASE-OUT THE USE OF POLYCHLORINATED BIPHENYLS (PCB) AND POLYCHLORINATED BIPHENYL (PCB) CONTAMINATED MATERIAL

 

Draft regulations were published under the National Environmental Management Act to phase out the use of polychlorinated biphenyls (PCB) and polychlorinated biphenyl contaminated materials by 2023.

In the Government Notice, members of the public were invited to submit written representations or objections on the proposed regulations within 60 days of publication of the notice.

The proposed regulations contain prohibitions on the use, importation and sale of PCB materials and PCB contaminated materials.  Importers, exporters and manufacturers of PCB materials and PCB contaminated materials are encouraged to download the draft regulations in order to determine how the prohibitions will affect their businesses.

Some of the products that could be affected by these regulations are:

        Waste oils containing PCBs, polychlorinated terphenyls (PCTs) or polybrominated biphenyls (PBBs) (subheading 2710.91); and

         Chemical compounds containing PCBs, PCTs or PBBs.

The proposed regulations to phase-out the use of PCB materials and PCB contaminated materials were published in Government Gazette Notice No. 36749 of 15 August 2013 under Notice No. R.849 of 2013. Members of the public and interested parties are invited to submit written representations and objections to the Department of Water and Environmental Affairs by 16 October 2013.

Download the draft regulations for more information.

 

 

Customs Tariff Applications and Outstanding Tariff Amendments

Notice 945 of 2013; List 15/2013

The International Trade Administration Commission (ITAC) is responsible for tariff investigations, amendments, and trade remedies in South Africa and on behalf of SACU.

Tariff investigations include:

Increases in the customs duty rates in Schedule 
No. 1 Part 1 of Jacobsens. These applications apply to all the SACU Countries, and, if amended, thus have the potential to affect the import duty rates in Botswana, Lesotho, Namibia, Swaziland and South Africa.

Reductions in the customs duty rates in Schedule No. 1 Part 1. These applications apply to all the SACU Countries, and, if amended, thus have the potential to affect the import duty rates in Botswana, Lesotho, Namibia, Swaziland and South Africa.

Rebates of duty on products, available in the Southern African Customs Union (SACU), for use in the manufacture of goods, as published in Schedule No. 3 Part 1, and in Schedule No. 4 of Jacobsens. Schedule No. 3 Part 1 and Schedule No. 4 are identical in all the SACU Countries.

Rebates of duty on inputs used in the manufacture of goods for export, as published in Schedule No. 3 Part 2 and in item 470.00. These provisions apply to all the SACU Countries.

Refunds of duties and drawbacks of duties as provided for in Schedule No 5. These provisions are identical in the all the SACU Countries.

Trade remedies include:

Anti-dumping duties (in Schedule No. 2 Part 1 of Jacobsens), countervailing duties to counteract subsidisation in foreign countries (in Schedule No. 2 Part 2), and safeguard duties (Schedule No. 2 Part 3), which are imposed as measures when a surge of imports is threatening to overwhelm a domestic producer, in accordance with domestic law and regulations and consistent with WTO rules.

Dumping is defined as a situation where imported goods are being sold at prices lower than in the country of origin, and also causing financial injury to domestic producers of such goods. In other words there should be a demonstrated causal link between the dumping and the injury experienced. To remedy such unfair pricing, ITAC may, at times, recommend the imposition of substantial duties on imports or duties that are equivalent to the dumping margin (or to the margin of injury, if this margin is lower).

Countervailing investigations are conducted to determine whether to impose countervailing duties to protect a domestic industry against the unfair trade practice of proven subsidised imports from foreign competitors that cause material injury to a domestic producer.

Safeguard measures, can be introduced to protect a domestic industry against unforeseen and overwhelming foreign competition and not necessarily against unfair trade, like the previous two instruments. In the WTO system, a member may take a safeguard action, which is, restricting imports temporarily in the face of a sustained increase in imports that is causing serious injury to the domestic producer of like products. Safeguard measures are universally applied to all countries, unlike anti-dumping and countervailing duties that are aimed at a specific firm or country.

Schedule No. 2 is identical in all the SACU Countries.

ITAC has received the following applications concerning amendments to the Customs Tariff of the Southern African Customs Union (SACU).  These applications related to:

1.       Increase in the domestic dollar-based reference price (DBRP) for sugar from US$ 358/ton to US$ 764/ton through an adjustment of the calculation of the DBRP for sugar by basing it on the domestic cost of production

Sugar is classifiable under various subheadings of heading No 17.01.

ITAC has received an application from the South African Sugar Association for an increase in the domestic dollar-based reference price (DBRP) for sugar from US$ 358/ton to US$ 764/ton through an adjustment of the calculation of the DBRP for sugar by basing it on the domestic cost of production.  By using the requested reference price, the variable tariff formula for sugar will trigger an increase in the London No. 5 sugar settlement price falls by US$ 20/ton below the base price, which is the 3-week moving average price for the London No. 5 settlement price.

Conversely a reduction in the duty will be triggered if the London No. 5 sugar settlement price increases by US$ 20/ton above the base price.  

Enquiries: Ms Lebogang Loate, fax (012) 394 4629 or Ms K Mzinjana , fax (012) 394 4664.

Representations should be submitted by 18 October 2013.  

2.  Comments requested on the increase in the allocation of quota levels for the importation of used overcoats under rebate item 460.11/00.00/01.00 for 2014

Rebate item 460.11 provides for a partial rebate on used over-coats, car-coats, raincoats, anoraks, ski-jackets, duffle-coats, mantles, three-quarter coats, greatcoats, hooded caps, trench coats, gabardines, padded waistcoats and parkas (excluding any other clothing articles) classifiable in tariff headings 61.01, 61.02, 62.01, 62.02 and 6309.00.13, in such quantities, at such times and subject to such conditions as ITAC may allow by specific permit.

The used coats that are admissible under this item must be imported in bales and must be designed to be worn over all other clothing as protection against the weather.

ITAC has requested interested parties to comment on a request by the Association of Importers of Worn Overcoats for a 30% increase in the level of the quota for 2014 regarding applications in terms of the provision under rebate item 460.11/00.00/01.00 for permits mention in the item.

Furthermore interested parties are requested to comment on a proposed amendment to the rebate item by the addition of the following conditions:

1.      Containers must arrive for inspection only during Monday to Friday. No arrivals may occur during Saturday, Sunday or public holidays.

2.      Importers need to provide the International Trade Administration Commission Of South Africa (ITAC) with proof of salaries being paid to temporary workers.

3.      The date for issuing permits be changed from February to an earlier period.

Enquiries: Barbara Moeng , Coert Grobbelaar Tel (012) 394 3672, Fax (012) 394 4672, or Kokami Getrude Legodi, tel (012) 394 3812, fax (012) 394 3812, emailklegodi@itac.org.za

Download the Notice to view the reasons for the increase in the quota levels and amendment of the Guidelines.

Representations should be submitted by 18 October2013.

3.       Creation of a rebate provision for full customs duty on (other) pile fabrics, knitted or crocheted, of man-mad fibres, classifiable in tariff subheading 6001.92, for the manufacture of footwear with uppers of textile materials, classifiable in Chapter 64

ITAC has received an application from Fast Fox Footwear / t/a Little Slippery Co. In Port Elizabeth for the creation of a rebate facility mentioned above.

As reasons for the application, it was stated that there are no local manufacturers, and the company is under threat from imported slippers.

ITAC Ref 37/2012, Enquiries Mr M Skenjana, tel. (012) 394 3675, fax (012) 394 4675 or e-mail mskenjana@itac.org.za

Representations should be submitted by 18 October 2013.

4.       Withdrawal of the application for an increase in the rate of duty on Biaxially oriented polypropylene classifiable under tariff subheadings 3920.20.25 and 3920.20.30 from 10% to 20%

ITAC has decided to withdraw the application above because Fima Films (Pty) Ltd indicated that as a result of the change in the management structure, a new strategy which differs from that of the previous management was developed.  The new management has considered the application for the increase in the rate of duty and decided that it would not be beneficial for the company owing to the negative response received from the downstream industry opposing the application.

ITAC Ref 06/2013, Enquiries Mr Nkulana Phenya fax (012) 394 4677 or e-mail Nphenya@itac.org.za or Ms Ayanda Ndou at fax (012) 394 4724 or e-mailendou@itac.org.za

The applications were published under LIST 15/2013 in Notice No. 945 OF 2013 which was published in Government Gazette No. 36849 OF 20 September 2013.

 

Customs Tariff Application List 14/2013 was published under Notice 860 of 2013 in Government Gazette 36760 of 23 August 2013.

 

The following applications were published under List 14/2013:

1.       Increase in the rate of Customs duty on coated fine paper (heading 48.10, various subheadings);

2.       Increase in the rate of Customs duty on roasted chicory (subheading 2101.30.10);

3.       Increase in the general rate of Customs Duty on heat exchange units (subheading 8419.40);

4.       Creation of rebate provisions for concentrated cranberry and passion fruit juices, not containing added sugar or other sweetening matter of a Brix value exceeding 45 for use in the manufacture of mixtures of fruit juices;

5.       Reduction of the Customs Duty on poly vinyl butyral (subheading 3920.91); and

6.       Amendment of Tariff subheadings 8302.30.30, 8302.41.10 and 8302.42.10 (fittings of iron, steel or copper)

 

 

Customs Tariff Amendments

With the exception of certain parts of Schedule 
No. 1, such as Schedule No. 1 Part 2 (excise duties), Schedule No. 1 Part 3 (environmental levies) Schedule No. 1 Part 5 (fuel and road accident fund levies), the other parts of the tariff is amended by SARS based on recommendations made by ITAC resulting from the investigations relating to Customs Tariff Applications received by them. The ITAC then investigates and makes recommendations to the Minister of Trade and Industry, who requests the Minister of Finance to amend the Tariff in line with the ITACís recommendations. SARS is responsible for drafting the notices to amend the tariff, as well as for arranging for the publication of the notices in Government Gazettes.

During the annual budget speech by the Minister of Finance in February, it was determined that parts of the tariff that are not amended resulting from ITAC recommendations, must be amended through proposals that are tabled by the Minister of Finance.

Once a year big tariff amendments are published by SARS, which is in line with the commitments of South Africa and SACU under international trade agreements.

Under these amendments, which are either published in November or early in December, the import duties on goods are reduced under South Africaís international trade commitments under existing trade agreements.

Subscribers can expect to receive the following loose-leaf amendments under cover of Supplement 1026.

 

 The amendments relate to : 

  • The creation of a new rebate provision for refined, bleached and deodorized but not fractionated palm oil used in the manufacture of edible fats and oils as recommended in ITAC Report No. 439.

The amendment above was published in Government Gazette No. 36905 of 11 October 2013 under Notice number R. 742 (Jacobsens Reference A3/1/698).

         Amendment of Note 6 (b)(iv) in Part 3 of Schedule No. 6 consequential to the increase in the Road Accident Fund Levy rate on rail from 88c/l to 96c/l as announced in the 2013 Budget Review of the Republic.

 

This notice was published in Government Gazette No. 36905 of 11 October 2013 under Notice R. 743 (Jacobsens Reference A6/3/36).  The effective date of this amendment is 3 April 2013.

  • The antidumping duties on door locks and door handles originating in or imported from the Peopleís Republic of China is terminated with effect from 21 August 2013.

This notice was published in Government Gazette No. 36905 of 11 October 2013 under Notice R. 744 (Jacobsens Reference A2/1/351.

 

Subscribe to the Jacobsens Customs Watch or download the latest Customs Watch to have access to the latest tariff and rule amendments.

 

Customs Rule Amendments

The Customs and Excise Act is amended by the Minister of Finance. Certain provisions of the Act are supported by Customs and Excise Rules, which are prescribed by the Commission of SARS. These provisions are numbered in accordance with the sections of the Act. The rules are more user-friendly than the Act, and help to define provisions which would otherwise be unclear and difficult to interpret.

Forms are also prescribed by rule, and are published in the Schedule to the Rules.

Two amendments to the Customs Rules were published on 11 October 2013.

Under the first amendment, a new Rule 120.12 was inserted relating to the non-acceptance of cheques at SARS offices or by post for amounts in excess of R100 000.

​Under the second amendment section 119A is amended by the fixing of the new implementation date of e-filing for excise accounts with effect from 30 January 2014.These amendments were published in Government Notice Gazettes Nos. 36905 and 36918 of 11 October 2013 under Notices Nos. R. 745 and 762 respectively. The SARS reference numbers for these amendments are DAR 123 and 126.

Download the amendments to view the notices.

 

 

 

 

 

Contact Information:

 

 

Contact the Author:

Mayuri Govender

Jacobsens Editor

Tel: 031-268 3273
e-mail:  
jacobsen@lexisnexis.co.za

 

 

Leon Marais 
Independent Customs Consultant
Tel: 053-203 0727

e-mail: leon.marais@intekom.co.za