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Customs News Bulletin

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28 July 2016

 

 

Latest News

SACU COULD BECOME A DUMPING YARD FOR HAZARDOUS CHEMICALS

International trade in dangerous chemicals is growing. In developed countries there is a better awareness by controlling authorities to control the importation and exportation of hazardous chemicals.  As the awareness in developed countries improves, the global trade in countries with a lesser awareness and with insufficient legislation increases. The Southern African Customs Union countries fall within this category and consumers in Botswana, Lesotho, Namibia, South Africa and Swaziland are exposed to many hazardous chemicals.

Hazardous chemicals are substances that are dangerous to people, wildlife and the environment.

Hazardous substances are chemical substances that persist in the environment, bio-accumulate through the food web and pose a risk of causing adverse effects to human health and the environment.

 In other words they are poisonous, remain in the environment for long periods of time, do not break down easily and they can build up in the bodies of organisms over an extended period and they can be spread via the food chain.

There are systems in place for the classification and identification of hazardous chemical substances but through a lack of understanding, these systems have created weak links and many hazardous chemical substances are not properly controlled when they are imported into the region, exported from the region, or just transported within the region.

Hazardous substances, for example pesticides, must be registered. In order to be efficient, pesticides, like many medicaments, must have active ingredients that treat or kill a specific disease, ailment or pest.  Older generations of medicaments or pesticides were not only hazardous to the consumer or the environment, but they were also less efficient because they were of the "broad spectrum" type.

As suppliers become aware of countries with better awareness for dangerous goods classification and identification they target countries where there is lesser awareness and where legislation is outdated. The SACU Countries fall within the latter group.

Suppliers also falsify documentation in an effort to circumvent existing legislation.  When unregistered or counterfeit hazardous chemical substances are imported into a country, sometimes by importers who are aware of the malpractices, the citizens of the country and the environment of that country are exposed to risks for many years.

The tariff classification of many hazardous chemical substances will change with effect from 1 January 2017 to give effect to requests from the Secretariats of the Chemical Weapons Convention, Rotterdam Convention and Stockholm Convention. If SACU update their import and export control legislation accordingly it should help to protect the citizens and environment of SACU and their trade partners against the negative effects associated with the importation and exportation of these hazardous substances.

However, SACU need much more than updated legislation. They will also need better awareness and responsible traders with a conscience and better co-operation between all stakeholders that are responsible for the monitoring and control of these substances.

 

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 Commission of South Africa (ITAC) also publishes Sunset Review Applications in relation to anti-dumping duty in terms of which any definitive anti-dumping duty will be terminated on a date not later than five years from the date of imposition, unless the International Trade Administration Commission determines, in a review initiated before that date on its own initiative or upon a duly substantiated request made by or on behalf of the domestic industry, that the expiry of the duty would likely lead to continuation or recurrence of dumping and material injury.

The International Trade Administration published the latest applications to amend the Customs Tariff of the Southern African Customs Union (SACU) under a document entitled: "International Trade Administration Act: Customs and Excise Tariff Applications: List6/2016".

The document was published in Government Gazette No. 40154 of 22 July 2016 under General Notice No. 441 of 2016.

The application relates to the review of the rates of customs duty on steel products classifiable under tariff headings: 72.17, 73.07, 73.08, 73.12, 73.18, 73.21, 83.02, 84.18, 84.26, 84.50, 84.51, 85.04, 86.01, 86.07, 86.09 and 94.06.

The investigating officers Lufuno Maliaga, Njabulo Mahlalela, Pfarelo Phaswana, Tel: 012 394 3835/3684/3628 or e-mail: lmaliaga@itac.org.za, nmahlalela@itac.org.za, pphaswana@itac.org.za. Comments are due by 19 August 2016.

ITAC also published a  directive to review the dollar-based domestic reference price and variable tariff formula for:

(1) Wheat classifiable under tariff subheadings 1001.91 and 1001.99; wheaten flour classifiable under tariff subheadings 1101.00.10 and 1101.00.90.

(2) Maize classifiable under tariff subheadings 1005.10 and 1005.90; maize flour classifiable under tariff subheading 1102.20; and

(3) Sugar classifiable under tariff heading 17.01. The investigating officers are:

Ms. R Theart, Tel: (012) 394 3674, Fax: (012) 394 4674, e-mail: rtheart@itac.org.za, Ms. M Masithela, Tel: (012) 394 3682, Fax: (012) 394 4682 e-mail: mmasithela@itac.org.za, Mr O Madito, Tel: (012) 394 3692, Fax: (012) 394 4692 e-mail: omadito@itac.org.za; or Ms. L Mulaudzi, Tel: (012) 394 1678, Fax: (012) 394 4678, e-mail: lmulaudzi@itac.org.za.

 

 

 

 

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 amendments to the Southern African Customs Union (SACU) Common External Tariff (CET). The loose-leaf pages reflecting the latest tariff amendments were sent to subscribers under cover of Jacobsens Supplement 1075. For more information about these amendments see the subscribers notice to Supplement 1075 or view the Customs Watch.

 

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 amendments to the Customs and Excise Rules. In terms of the last Rule amendment various forms DA 260 for the rendering of excise accounts were amended in the Schedule to the Rules on 8 July 2016. For more information about these amendments view the latest Customs Watch.

 

 

 

 

 

 

 

Contact Information:

 

Contact the Author:

Havandren Nadasan
Jacobsens Editor

Tel: 031-268 3510
e-mail to:
jacobsens@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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