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Customs News Bulletin

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17 June 2015

 

 

Latest News

TOWARDS A PROFESSIONAL CUSTOMS ERA

Examinations for professional will be introduced under the Customs Control Act, 2014 (Act No. 31 of 2014).

The terms “Professional Customs Registration Examination” and “Professional Customs License Examination” are defined the Draft Rules to Chapters 28 and 29 of the Customs Control Act.

These examinations will be introduced to establish whether a person has sufficient knowledge of applicable customs laws, guides, interpretive notes, operational manuals and practices.

The examinations will be administered by customs or by a recognized professional body for the purposes of the National Qualifications Framework Act, 2008 (Act 67 of 2008), with the permission of the customs authority and subject to such conditions as the customs authority may determine.

Sufficient knowledge simply means that the “professional” must pass the examination.

This concept will be new in South Africa, but it is not a new phenomenon in other countries. In the United States of America, Customs brokers (clearing and forwarding agents) must pass a customs broker examination before they can apply to be licensed as customs brokers – a term which will also be used in South Africa when the Customs Control Act, 2014 takes effect.

The Examination is called a Customs Broker License Examination in the United States.

The US exam consists of 80 multiple-choice questions and the pass rate should be 75% or better. The examination lasts between 4 hours and 4 hours and 30 minutes.

Examination topics include: entry (customs clearance), tariff classification, country of origin, trade agreements, customs valuation, anti-dumping and countervailing duty, responsibilities of the customs broker, fines, penalties and forfeiture, protests (appeals and dispute resolution), marking (labeling), prohibited and restricted merchandise (goods), drawbacks, intellectual property rights, and other subjects pertinent to the duties of a customs broker.

There are still many concerns and uncertainties about these examinations in South Africa. But one can expect to see their introduction under the Customs Control Act.

 

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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