http://www.lexisnexis.co.za/images/jacobsens/jacobsens_logo.jpg

Customs News Bulletin

http://www.lexisnexis.co.za/images/jacobsens/jacobsens_img01.jpg

 

http://www.lexisnexis.co.za/images/jacobsens/jacobsens_img02.jpg

 

http://www.lexisnexis.co.za/images/jacobsens/jacobsens_img03.jpg

http://www.lexisnexis.co.za/images/jacobsens/jacobsens_img04.jpg

http://www.lexisnexis.co.za/images/jacobsens/jacobsens_img05.jpg

 

http://www.lexisnexis.co.za/images/jacobsens/jacobsens_img06.jpg

http://www.lexisnexis.co.za/images/jacobsens/jacobsens_img07.jpg

http://www.lexisnexis.co.za/images/jacobsens/jacobsens_img08.jpg

http://www.lexisnexis.co.za/images/jacobsens/jacobsens_img09.jpg

 

12 November 2015

 

 

Latest News

AGOA STILL HANGS IN THE BALANCE

Earlier this year it was though that the dispute over US meat imports into South Africa that almost led to the derailment of South Africa's AGOA benefits was resolved when the African Growth and Opportunities Act (AGOA) was renewed prior to the 30 September deadline.

When South Africa agreed to lift the anti-dumping duties on 65 000 tons of US poultry per annum through quotas in an agreement that was reached in Paris in June 2015 everyone thought that the AGOA issue has finally been resolved and that South African exporters would continue to enjoy the benefits of duty free imports into the United States.

A notice titled "Rebate of full anti-dumping duty and rebate provisions draft guidelines" was published by the International Trade Administration Commission (ITAC) in Government Gazette 39352 of 30 October 2015.  In terms of this notice comments are invited to introduce the quotas that will apply to the anti-dumping duties on chicken as per South Africa's discussions about the continuation of the AGOA.

There are however still outstanding issues in the form of a ban on US poultry imports following an outbreak of bird flu in the States and beef and pork meat are also blocked as a result of South African phytosanitary measures.  These issues had to be ironed out by 15 October 2015.

On Thursday (5 November 2015) President Barack Obama threatened to revoke the duty-free status for South African agricultural goods imports into the United States under AGOA within 60 days if the outstanding issues are not resolved by 4 January 2016.

 "I am taking this step because South Africa continues to impose several longstanding barriers to US trade, including barriers affecting certain US agricultural exports", Mr Obama wrote in a letter to the US Congress.

Industries such as the motor vehicle industry will continue to enjoy the benefits of duty-free imports into the United States but the suspension of the benefits for agricultural exports to the United States will have a huge impact on exporters of certain agricultural products such as citrus fruit, wine and macadamia nuts. The export value of SA's agricultural products to the US that benefit from Agoa — particularly citrus fruit, wine and macadamia nuts — is about $137m, or R1.9bn, a year. Wine and citrus exports account for R1,47 billion.

The impact on producers in the Western Cape and Northern Cape will be severe, said Mr Justin Chadwick, CEO of the Citrus Fruit Association of Southern Africa. According to him 40% of the Western Cape and Northern Cape produce are exported to the United States.

It will have a huge impact on employment as well. The wine industry alone employs 289 000 people.  

 

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 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.

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.

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.

The International Trade Administration Commission (ITAC) has received 2 applications to amend the Customs Tariff of the Southern African Customs Union (SACU), comprising Botswana, Lesotho, Namibia, South Africa and Swaziland.  A correction notice to replace a previous application was also published.

The applications relate to:

  • Increase in the general rate of duty on numerous iron and non-alloy steel products of Chapter 72 from free to 10%, as requested by ArchelorMittal South Africa Limited.  (Comments due by 6 November 2015 – within two weeks of publication date);

  • Increase in the general rate of customs duty on certain ceramic ware classifiable in tariff subheadings 6910.10 and 6910.90, as requested by Vaal Sanitaryware (Pty) Ltd from 20% to 30% ad valorem. (Comments due within 4 weeks of the publication date of the Notice, which is 23 October 2015); and  

  • Reduction in the rate of duty on certain diesel, petrol and electric passenger vehicles not exceeding 800kg; diesel goods vehicles not exceeding 1 100kg and petrol and electric goods vehicles exceeding 800kg, from 25% ad valorem to free of duty.  The vehicles are classifiable in tariff subheadings 8703.21.75, 8703.31.85, 8703.90.31, 8704.21.77, 8704.31.77, 8704.90.35 shall have steering wheels fitted on the left hand side of the vehicle and may not be operated on a public road in terms of the National Road Traffic Act (Act 93 of 1996).

The applications were published in Government Gazette 39324 of 23 October 2015 under Notice No. 1007 of 2015 (List 11/2015).

Download the Notice at http://www.gov.za/sites/www.gov.za/files/39324_gen_1007.pdf  

List 10/2015 was published under Notice No. 709 of 2015 in a Government Gazette of 18 September 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.

The South African Revenue Services (SARS) published one notice to amend the Southern African Customs Union (SACU) Customs Tariff.  The amendment was published in Government Gazette 39375 of 6 November 2015 under Notice R. 615, with effect from 25 March 2015.

The anti-dumping duties on solar glass originating in or imported from the People’s Republic of China and India are terminated with retrospective effect to 25 March 2015.

The loose-leaf pages to amend the Jacobsens Harmonized Customs Tariff were sent to subscribers under cover of Supplement 1061.

 

 

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.

There were no Rule amendments at time of publication.

On 3 July 2015, SARS Customs published an Amendment of the Customs and Excise Rules under section 21A relating to special economic zones (SEZs).

The rule amendment (DAR/156) was published on 3 July 2015 in Government Gazette 38925 under Notice R. 566.

The effective date of this amendment will be on the date that the regulations under the Special Economic Zones Act, 2014 come into effect.

Download the latest Customs Watch at www.jacobsens.co.za 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

 

© Customs News Bulletin is prepared for distribution by LexisNexis. It is for information only, and does not constitute the provision of professional advice of any kind. No responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this publication can be accepted by the author, copyright owner or publisher.

Copyright: LexisNexis (Pty) Ltd retains the copyright of this email. No part of this email may be reproduced in any form or by any means without the publisher's written permission. Any unauthorised reproduction of this work will constitute a copyright infringement and render the doer liable under both civil and criminal law.

To unsubscribe e-mail jacobsen@lexisnexis.co.za.