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Customs News Bulletin

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10 June 2015

 

 

Latest News

SOUTH AFRICA-UNITED STATES CHICKEN DISPUTE RESOLVED

AGOA 2015 Back on Track

 

The anti-dumping duty of 940c/kg on frozen chicken cuts imported from or originating in the United States of America which was, in addition to the General rate of duty of 37%, the subject of the chicken dispute. 

 

This dispute was threatening South Africa’s continued participation in the African Growth and Opportunity Act (Agoa), which provides duty-free access of African products to the United States. AGOA is due to expire in September this year.

The dispute was resolved following discussions in Paris, France on 4 and 5 June 2015. The meetings were facilitated by the US and SA Governments and involved the poultry industries of both countries.  

South Africa agreed to make provision for a quota of 65,000 tonnes a year into South Africa on which the anti-dumping duty of 940c/kg will be rebated.  A fourth Schedule rebate item will be created to provide for a rebate on the anti-dumping duty subject to production of tariff rate quota permits on bone-in chicken cuts into the South African market.

The  agreement which has been reached now paths the way for South Africa to benefit from the new AGOA which will be extended for a further 10 years.

Agoa provides duty-free market access to the US for qualifying sub-Saharan African countries by extending preferences on more than 4 600 products.  Under AGOA, African products such as cars, base metals, chemicals, citrus fruit, wines and nuts enter the world's number one economy free of duty.

South Africa had no option than to compromise the anti-dumping duties on chicken in order to benefit from duty-free access of existing and new exports into the United States.

South Africa's poultry industry could lose close to 900 million rand ($72 million) in turnover and about 6,500 jobs as a result of an agreement to allow duty-free imported chicken from the United States, but this is a small price to pay for the benefits that will be offered to exporters of other products. Other exporters need to thank the South African Poultry Association (SAPA) and cash in on the opportunities that will be offered by AGOA.

Read more: http://www.southafrica.info/business/trade/relations/chicken-080615.htm#.VXfVhM-qqko#ixzz3cdZGrlja

 

Customs Tariff Applications and Outstanding Tariff Amendments

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.

Thee following ITAC application (List 05/2015 / Notice 486 of 2015) was published in Government Gazette No 38822 on 29 May 2015.

A. PROPOSED AMENDMENT OF THE CONDITIONS PERTAINING TO THE GUIDELINES, RULES AND CONDITIONS PERTAINING TO TEXTILE FABRIC IMPORTED IN TERMS OF REBATE ITEMS 320.01/5407.61/01.06, 320.01/5903.20.90/ 01.08 AND 320.01/5907.00.90/01.08 FOR THE MANUFACTURE OF UPHOLSTERED FURNITURE; AND

B. WITHDRAWAL OF THE REQUEST BY TEXFED TO AMEND THE WORDING OF THE EXISTING REBATE PROVISION FOR 320.01/5407.61/01.06, AS PUBLISHED IN THE GOVERN-MENT GAZETTE ON 20 FEBRUARY 2015 AND AS SET OUT BELOW:

a) The additional proposed amendments to the guidelines regarding applications for permits for rebate of the full duty on qualifying fabrics used in the manufacture of upholstered furniture in terms of the provisions under rebate items 320.01/5407.61/01.06; 320.01/5903.20.90/01.08 and 320.01/5907.00.90/01.08 of Schedule 3 to the Customs and Excise Act. The additional proposed amendments to the guidelines are as follows:

1. Applications to ITAC for rebate permits will be accompanied by a sample of the fabrics to be imported which will then be sent to the Textile Federation (Texfed) for its confirmation of the local availability. Furthermore, upon importation, a sample of each of the fabrics included in the rebate permit should be supplied to South African Revenue Service (SARS) for verification purposes.

2. An annual audit should be performed by an independent 3rdparty who will perform the audit on importers of the rebated fabric. A Texfed representative may accompany such an audit process.

3. All applications by companies for rebates will be forwarded to industry representative bodies for comment before approval, in order to enhance ITAC's understanding of the bona fides of the applicant.

4. All consignment level data relating to the rebate application should be provided to interested parties , including trade associations and trade unions, and should include the following information relating to imports:

i. Date of import;
ii. Port of entry;
iii. Country of origin;
iv. Country of export;
v. Description of goods imported and quantity of goods imported;
vi. Rand value of goods imported
vii. Purpose (Customs Procedure/CPC) code and
viii. Identity of importer
 

b) Withdrawal of the request by Texfed to amend the current wording of certain fabrics, which may be imported in terms of rebate provision 320.01/5407.61/01.06 that is used for the manufacture of upholstered furniture.

Enquiries:
Ms Khosi Mzinjana
Tel. (012) 394 3664
Fax (012) 394 4664
E-mail: kmzinjana@itac.org.za; or

Ms Amina Varachia
Tel. (012) 394 3732
Fax (012) 394 4732
E-mail: avarachia@itac.org.za

Comments on this application is due by 26 June 2015.
 

 

 

 

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 ITAC’s 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 Africa’s international trade commitments under existing trade agreements.

There were no tariff amendments at time of publication.

 

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.

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

There were no Rule amendments at time of publication.

The last rule amendment (DAR/144) was published on 27 March 2015 in Government Gazette 38603 under Notice R. 246.

Download the latest Customs Watch to have access to the latest tariff and rule amendments.

 

LexisNexis

 

 

 

 

 

Contact Information:

 

Contact the Author:

Mayuri Govender
Jacobsens Editor

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

 

Leon Marais
Independent Customs Consultant
Tel: 053-203 0727
e-mail to:
leon.marais@intekom.co.za

 

LexisNexis

 

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