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Customs News Bulletin

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16 February 2017

 

 

Latest News

DISPUTE RESOLUTION UNDER THE SOUTH AFRICAN CURRENT CUSTOMS AND EXCISE ACT

(Sections 77A to H of the Customs and Excise Act, 91 of 1964 and Rules 77H.01 to .16; Section 77 I, and J to P)

South Africa’s legislation pertaining to dispute resolution is aligned with international best practice and local legislation.  It provides guidelines for Customs officers and stakeholders.

The legislation was introduced on 4 June 2007 and is aligned to the Revised Kyoto Convention, the Constitution of the Republic of South Africa and the Promotion of Administrative Justice Act (PAJA).

If anyone does not agree with the decision of a Customs officer, he/she should approach the officer’s that made the decision’s immediate supervisor/s in order to clarify the decision in question and resolve any uncertainties. Should the matter not be resolved in this way, the person may institute a formal internal administrative appeal (IAA).

The IAA will be an appeal to the relevant appeal committee. Appeals must be lodged on a form DA51 at the office which notified them of the decision.

Tariff and Valuation appeals are dealt with by the Tariff and Valuation Divisions.

The IAA appeal must be delivered to the office from which the notice of the decision was issued within the period specified by Rule 77H.03. The period is currently 30 days.

Upon request by the appellant, the 30-day period may be extended to 60 days by the Commissioner if he is satisfied that reasonable grounds exists for the delay in complying with that period.

The Commissioner must respond to the appeal within a period of 30 to 60 days depending on the circumstances (see Rule 77H.03 (c) and (d) below:

"(c)

Where in the opinion of the Commissioner adequate reasons have already been provided, the Commissioner must within 30 days after receipt of the request contemplated in paragraph (a), notify the person concerned accordingly in writing which notice must refer to the documents wherein such reasons were provided.

 

 

(d)

Where in the opinion of the Commissioner adequate reasons have not yet been provided, the Commissioner must provide written reasons for the decision within 60 days after receipt of the request contemplated in paragraph (a):

Provided that where in the opinion of the Commissioner more time is required due to the complexity of the matter, the principle or the amount involved or any other circumstances deemed reasonable by the Commissioner, the Commissioner must, before expiry of that 60 day period, inform the person concerned that written reasons will be provided not later than 45 days after the date of expiry of that first 60 day period".

On the DA 51 an appellant must:

Provide a full description of all the facts which are required to decide the appeal in chronological order. If the space provided is insufficient, the facts should be provided in a separate document and be attached to the form DA 51.

Attach, list and sequentially number all supporting documents to the form DA 51 in chronological order.

Failure to comply with the requirements above may result in the appeal not being accepted as valid and rejected which will result in delays in the finalisation of the appeal.

If the appellant is not satisfied with a decision of the appeals committee, his/her recourse will be to lodge an application for ADR (Alternative Dispute Resolution) with the relevant appeal committee which made the decision. The committee will add its comments thereto and forward the application to the ADR Unit.

The ADR Process provides for recourse against a final decision made under the Internal Administrative Appeals (IAA) Process or as an alternative to litigation.

It is important to note that the appellant has to respond within the 30 day period otherwise neither the IAA process, nor ADR process can be followed and the applicant’s recourse will then lie in litigation. ADR may, however, be offered by SARS as part of the litigation process.

To apply for ADR, a properly completed form DA 52, together with the relevant supporting documents, must be submitted to the person who informed them of the decision they are appealing against within 30 days of being notified of that decision.

 

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.

There were no applications to amend the SACU Tariff.

 

 

 

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.

There were no amendments to the Customs and Excise Rules at time of publication .

 

 

 

 

 

 

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@itacs.co.za

 

LexisNexis

 

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