SARS
CUSTOMS IMPLEMENTS SADC EPA AND SACU/MERCOSUR TRADE AGREEMENTS
SARS
Customs have published various notices to implement two free trade
agreements between the Southern African Customs Union Countries (Botswana,
Lesotho, Namibia, South Africa and Swaziland) and trade partners, namely the
. Preferential Trade Agreement between the Common Market of the South (MERCOSUR)
and the Southern African Customs Union (SACU) and the Economic Partnership
Agreement (EPA) between the European Union (EU) and the Southern African
Development Community EPA States.
The
Preferential Trade Agreement between the Common Market of the South (MERCOSUR)
is an agreement between the countries of MERCOSUR (Argentina, Brazil,
Paraguay and Uruguay) on the one part and the Southern African Customs Union
(SACU), comprising South Africa and the BLNS-Countries (Botswana, Lesotho,
Namibia and Swaziland).
The first
agreement leading to the SACU/MERCOSUR PTA was signed at the end of the year
2000 when these countries signed a framework agreement towards the creation
of the free trade area between MERCOSUR and the Southern African Customs
Union.
Four years
later, in December 2004, MERCOSUR and the Southern African Customs Union (SACU)
signed a preferential trade agreement. In conjunction with the agreement,
they issued an understanding on the conclusion of their preferential trade
agreement. The final agreement was only signed after many rounds of
negotiations on 15 December 2008.
The
Preferential Trade Agreement between the Common Market of the South (MERCOSUR)
and the Southern African Customs Union (SACU), was signed on 15 December
2008, in Salvador, Brazil; and, on 03 April 2009 in Maseru, Lesotho.
The rates
of duty on about 1,000 product lines on each side of the border will be
reduced under the PTA between SACU and Mercosur.
The
Economic Partnership Agreement between the SADC EPA States, of the one part,
and the European Union and its Member States, of the other Part, have
entered into force on 10 October 2016. In terms of the SADC EPA, which is an
agreement between the SACU Countries and Mozambique (referred to as the SADC
EPA Group) and the European Union (EU), the trading regime between SACU and
the EU has been harmonized to secure further market access in agriculture
(beyond the SA-EU Trade Development and Co-operation Agreement (TDCA)
provisions).
The
Economic Partnership Agreement between the SADC EPA States and the EU covers
most products. It replaces the Trade Chapter of the Trade Development and
Co-operation Agreement (TDCA) between the European Union and South Africa
which existed between 2000 and 2016. South Africa will enjoy better market
access under the SADC EPA than it had under the TDCA.
An extra
column, titled “Mercosur” will be added after the SADC column in Part 1 of
Schedule No. 1 to the Customs and Excise Act, which is also the common
external tariff of Botswana, Lesotho, Namibia and Swaziland. At the same
time SARS Customs will publish notices to implement the amendments that will
replace the once controversial SADC Economic Partnership Agreement. The
effective dates of the agreements are as follows:
Preferential Trade Agreement between the MERCOSUR and the SACU with
retrospective effect from 1 April 2016; and
Economic
Partnership Agreement (EPA) between the EU and the SADC EPA States with
retrospective effect from 10 October 2016.
There were
six notices to amend the Southern African Customs Union (SACU) Tariff
resulting from the implementation of the two agreements:
-
The
General Notes to Schedule No. 1 are amended to give effect to the
implementation of the Preferential Trade Agreement between the Common
Market of the South (MERCOSUR) and the Southern African Customs Union (SACU)
by the insertion of Note M, the renumbering of General Note M as General
Note N, the amendment of General Note N and by the insertion of Part D
which includes the Rules of Origin (SARS Reference 1/1/1150 wef 1 April
2016) (Notice No. R. 1285);
-
The
entire Schedule No. 1 Part 1 (with the exception of the Section and
Chapter Notes) are substituted by the addition of the Mercosur column
with effect from 1 April 2016 (SARS Reference 1/1/1149 with
retrospective effect from 1 April 2016) (Notice No. R. 1287);
-
Schedule No. 10 is amended by the insertion of Part 7 (the legal text of
the PREFERENTIAL TRADE AGREEMENT BETWEEN THE COMMON MARKET OF THE SOUTH
(MERCOSUR) AND THE SOUTHERN AFRICAN CUSTOMS UNION (SACU)) (SARS
Reference 10/14 with retrospective effect to 1 April 2016) (Notice No.
R. 1286); and the following Annexes:
ANNEX I:
Offer of MERCOSUR to SACU (based on HS 2007);
ANNEX II:
Offer of SACU to MERCOSUR (based on HS 2007);
ANNEX IV:
Safeguard measures;
ANNEX V:
Dispute settlement procedure;
ANNEX VI:
Sanitary and Phyosanitary measures.
The Rules
to implement the SADC EPA Agreement were published in a 60 page South
African Government Gazette Notice on 10 October 2016 but Rules for
the SACU Mercosur Agreement have not been published yet.
The
following notices (four plus various annexes) were published to implement
the EU/SADC EPA:
-
The
General Notes to Schedule No. 1 are amended to give effect to the
implementation of the Economic Partnership Agreement (EPA) between the
European Union (EU) and the Southern African Development Community EPA
States by amending General Note IJ and by replacing Part A (the Rules of
Origin of the SA/EU TDCA with the Rules of Origin of the SADC EPA (SARS
Reference 1/1 1151 with effect from 10 October 2016)(Notice No. R.
1289);
-
The
rates of duty on fish products of Chapters 3 and 16 are amended to give
effect to the implementation of the EPA agreement between the EU and the
SADC EPA States (SARS Reference 1/1/1153 with effect from 10 October
2016)(Notice No. R. 1283);
-
The
rates of duty on various industrial products classifiable in Schedule
No. 1 Part 1 are amended to give effect to the implementation of the EPA
agreement between the EU and the SADC EPA States (SARS Reference
1/1/1152 with effect from 10 October 2016)(Notice No. R. 1284);
-
Schedule No. 10 by the renumbering of Part 1 as Part 1A and the
insertion of Part 1B to give effect to the implementation of the EPA
agreement between the EU and the SADC EPA States (SARS Reference 10/15
with retrospective effect to 10 October 2016)
SARS also
published various annexes to the Schedule No. 10 notice.
The Notices
were published in Gazette No. 40356 of 21 October 2016.
The
learning material for the SAQA Unit Standard 252248 which is titled “Certify
certificates of origin and other commercial documents” will be updated
within the next two weeks.
The Unit
Standard deals with the reasons for the certification of Certificates of
Origin and other commercial documents, supporting documents and the
regulations, processes and procedures relating to certificates of origin.
SADC
ECONOMIC PARTNERSHIP AGREEMENT TAKES EFFECT: RULES PUBLISHED
SARS
published a rule amendment to implement the Economic Partnership Agreement
between the SADC EPA states, of the one part, and the European Union and its
member states, of the other part.
The rules
numbered 49A are rules contemplated in section 49(6)(b) in respect of the
Economic Partnership Agreement between the SADC EPA states, of the one part,
and the European Union and its member states, of the other part.
Where any
rule reflects a number or numbers in brackets after a serial number, for
example, 49A.01(5), the number in brackets refers to the Article number or
numbers of Protocol 1 entitled “concerning the definition of the concept of
‘originating products’ and methods of administrative co-operation” of the
Agreement to which the rule relates.
Various
expressions are defined in Rule 49A.01(d).
Rule
49A.01(f) deals with the registration of exporters and producers and the
relevant forms that need to be completed.
There are
also Rules in respect of the Rules of Origin in respect of the following
under Annex 1, Protocol 1 (if an Article is not mentioned in the table below
there are no rules to that Article):
TITLE II -
DEFINITION OF THE CONCEPT OF “ORIGINATING PRODUCTS”
Rule number |
Article of EPA |
Topic |
|
|
|
49A.04(3),(4),(5),(6) |
Article 3 |
Bilateral cumulation |
|
|
|
|
Article 4 |
Diagonal cumulation |
|
|
|
|
Article 5 |
Cumulation with respect to materials which are subject to Most
Favoured Nation (MFN) duty free treatment in the European Union |
|
|
|
|
Article 6 |
Cumulation with respect to materials originating in other countries
benefiting from preferential duty-free quota-free access to the
European Union |
|
|
|
49A.05(7) |
Article 7 |
Wholly obtained products |
|
|
|
49A.06(8), (9) |
Article 8 |
Sufficiently worked or processed products |
|
|
|
|
Article 9 |
Insufficient working or processing operations |
|
|
|
49A.09(12) |
Article 12 |
Sets |
TITLE III -
TERRITORIAL REQUIREMENTS
Rule number |
Article of EPA |
Topic |
|
|
|
49A.11(14) |
Article 14 |
Principle of territoriality |
|
|
|
49A. 12(15) |
Article 15 |
Non-alteration |
|
|
|
49A.13(16) |
Article 16 |
Accounting segregation |
|
|
|
49A.14(17) |
Article 17 |
Shipment of sugar |
|
|
|
49A.15(18) |
Article 18 |
Exhibitions |
TITLE IV -
PROOF OF ORIGIN
Rule number |
Article of EPA |
Topic |
|
|
|
49A.16(19), (20) |
Article 19 |
General requirements |
|
|
|
|
Article 20 |
Procedure for the issue of a movement Certificate EUR1 |
|
|
|
49A.17(21) |
Article 21 |
Movement Certificates EUR1 issued retrospectively |
|
|
|
49A.18(22) |
Article 22 |
Issue of a duplicate movement certificate EUR1 |
|
|
|
49A.19(23) |
Article 23 |
Issue of movement certificates EUR1 on the basis of a proof of
origin issued or made out previously (“Replacement Movement
Certificate”) |
|
|
|
49A.20(24),(25) |
Article 24 |
Conditions for making out an origin declaration |
|
Article 25 |
Approved exporter |
|
|
|
49A.21(26) |
Article 26 |
Validity of proof of origin |
|
|
|
49A.22(27) |
Article 27 |
Submission of proof of origin |
|
|
|
49A.23(28) |
Article 28 |
Importation by instalments |
|
|
|
49A.24(29) |
Article 29 |
Exemptions from proof of origin |
|
|
|
49A.25(30) |
Article 30 |
Information procedure for cumulation purposes |
|
|
|
49A.26(31) |
Article 31 |
Supporting documents |
|
|
|
49A.30(32) |
Article 32 |
Preservation of proof of origin and supporting documents (Record
keeping requirements) |
|
|
|
49A.27(33) |
Article 33 |
Discrepancies and formal errors |
|
|
|
49A.29(34) |
Article 34 |
Amounts expressed in EURO |
TITLE V –
ARRANGEMENTS FOR ADMINISTRATIVE CO-OPERATION
Rule number |
Article of EPA |
Topic |
|
|
|
49A.32(37) |
Article 37 |
Mutual assistance |
|
|
|
49A.33(38) |
Article 38 |
Verification of proof of origin |
|
|
|
49.34(38) s/b (39) |
Article 39 |
Verification of suppliers’ declarations |
|
|
|
49A.35(40) |
Article 40 |
Dispute settlement |
|
|
|
49A.37(42) |
Article 42 |
Free zones |
TITLE
VII – FINAL PROVISIONS
Rule number |
Article of EPA |
Topic |
|
|
|
49A.45 |
|
General. Deals amongst other with:
Documents to be submitted and procedures to be followed on
presentation of bills of entry for goods in respect of which
preferential treatment is claimed. |
|
|
|
|
|
Tariff rate quotas |
|
|
|
49A.48.03 |
|
Export to the European Union of goods subject to tariff quotas |
|
|
|
49A.49.04 |
|
Imports from the European Union of goods subject to tariff quotas |
|
|
|
The list of
originating materials (List Rules) referred to in paragraph (a) under the
Rules to Article 4 (diagonal cumulation) is published as Appendix 1 to Part
A to the General notes to Schedule 1 (the Rules of Origin for the SADC EPA).
It will appear in a Government Gazette Notice which will be published
by SARS on 21 October 2016.
In addition
to the Rule amendments above, the customs duty rates in Schedule No. 1 Part
1 will be affected. The legal text of the agreement will be published in
Schedule 10 to the Customs and Excise Act. The quota rates for importation
into SACU will be published under rebate item 460.25 which will be amended.
The
following forms have also been amended in item 202 of the Schedule to the
Rules:
Form Number |
Form Name |
|
|
DA
185 |
Application form: Registration/Licensing of Customs and Excise
Clients |
|
|
DA
185.4A2 |
Registration Client Type 4A2 - Exporter (Local or Foreign) |
|
|
DA
185.4A7 |
Registration Client Type 4A7 - Producer |
|
|
DA
185.4A11 |
Client type 4A11 - Special Economic Zone Operator (SEZ) and/or
designation of a Customs Controlled Area (CCA) - (Sections 21A, 59
and Rule 21A.04) |
|
|
DA
185.4B9 |
Client type DA 185.4B9 - Special Storage Warehouse (Customs
Controlled Area Enterprise) - (Sections 19A, 21, 21A, 60, 61 and
Rule 21A.10) |
|
|
DA
185.4B10 |
Client type DA 185.4B10 - Manufacturing Warehouse (Customs
Controlled Area Enterprise) - (Sections 19A, 21A, 27, 59A and Rule
21A.10) |
WCO HS 2017
COMPLIMENTARY PUBLICATIONS
In addition
to the entry into force of the Southern African Development Community
(SADC)/European Union (EU) Economic Partnership Agreement (EPA) and the
Southern African Customs Union (SACU)/Mercosur Free Trade Agreement which
necessitated the replacement of Schedule No. 1 Part 1 of the South African
Customs and Excise Act, which is also the HS-based Southern African Customs
Union (SACU) Common External Tariff (CET), the Harmonized System will also
be replaced by a new version, HS 2017, with effect from 1 January 2017.
This will
be the sixth version of the HS since its introduction with effect from 1
January 1988. In terms of SACU’s commitments under the HS Agreement, large
parts of Schedule No. 1 Part 1 will once again be amended with effect from 1
January 2017. All complimentary World Customs Organization (WCO) HS
publications will be replaced by new publications and products.
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