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Customs News Bulletin

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9 March 2017

 

 

Latest News

SOUTH AFRICAN PHYTOSANITARY LEGISLATION SOON TO BE ALIGNED TO INTERNATIONAL STANDARDS

Phytosanitary legislation relates to the health of plants and plant health, especially in respect of the requirements of international trade.

The current South African phytosanitary regulatory system is administered under the Agricultural Pests Act, 1983 (Act No. 36 of 1983) (APA) and its associated regulations. The purpose of the Agricultural Pests Act, 1983, with regard to phytosanitary matters is to provide for measures by which quarantine pests of plants, plant products and other regulated articles may be prevented from entering and establishing in South Africa, and for combating plant pests of national concern.

The 1983-APA has been in force for more than three decades, it has been through two different government systems and was promulgated before the adoption of the International Plant Protection Convention, 1997 and the World Trade Organisation Agreement on the Application of Sanitary and Phytosanitary Measures (WTO-SPS Agreement) of 1995.

The most import reason for the introduction of the new Plant Health (Phytosanitary) Bill is however that international phytosanitary requirements are regulated by the World Trade Organisation (WTO) Agreement on the Application of Sanitary and Phytosanitary (SPS) Measures and that South Africa, as a WTO Member State and founding member of the WTO must align its national legislation with that of the WTO which replaced the GATT in 1994.

The Minister of Agriculture, Forestry and Fisheries (DAFF) thus recently introduced the Plant Health (Phytosanitary) Bill, 2017 in the National Assembly.  The Bill was also published as Bill 7 of 2017 in a Government Gazette on 3 March 2017. 

The Plant Health (Phytosanitary) Bill, 2017 seeks to repeal those sections of the Agricultural Pests Act, 1983 (Act No. 36 of 1983) that deal with phytosanitary matters, in order to strengthen and improve the phytosanitary regulatory system of South Africa in relation to international trade.

The Plant Health (Phytosanitary) Bill provides for:

  • phytosanitary measures to prevent the introduction, establishment and spread of regulated pests in the Republic;

  • the control of regulated pests;

  • the regulation of the movement of plants, plant products and other regulated articles into, within and out of the Republic; and

  • matters connected therewith.

In addition the Phytosanitary Bill seeks to address gaps and challenges in the current South African phytosanitary system in view of our obligations under the relevant international agreements and treaties to which we are a signatory member and to adhere to the relevant principles and standards, and the requirement of our major trade partners. 

The Phytosanitary Bill also aims to support Government's priorities such as sustainable management and use of natural resources, the provision of effective national regulatory services and risk management systems as well as increased contribution of the agricultural sector to economic growth and development.

The Plant Health (Phytosanitary) Bill will become the Phytosanitary Act on a date fixed by the President by proclamation in the Gazette.

 

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.

ITAC did not receive any applications concerning the amendment of the Common External Tariff of the Southern African Customs Union (SACU) comprising Botswana, Lesotho, Namibia, South Africa and Swaziland since the Bulletin of 24 February 2017.

The latest application to amend the SACU Tariff was published in Government Gazette No. 40621 of 17 February 2017 in Notice No. 129 of 2017.

Comments are due by 17 March 2017.

The applications relate to the creation of a rebate provision for the veteran motor vehicles and the reduction in the rates of duty on rack and pinion steering assemblies classifiable under tariff subheading 8708.94.20.

For more information on these applications refer to Jacobsens Customs Bulletin of 24 February 2017 or contact the ITAC investigating officer below:  

ITAC Ref: 23/2016, Enquires: Ms. Pateka Busika, Ms. Mukeliwe Manyoni and/or Mr. Daniel Thwala, Tel: 012 394 3595/3676/5162 or alternatively e-mail pbusika@itac.org.za/mmanyoni@itac.org.za/ dthwala@itac.org.za in respect of the rebate provision for veteran motor vehicles.

ITAC Ref: 21/2016, Enquires: Mr. Mashudu Lukhwareni/ Mr Daniel Thwala, Tel: 012 394 3661/5162 or e-mail mlukhwareni@itac.org.za/dthwala@itac.org.za in respect of the application for the reduction in the customs duty rates on rack and pinion assemblies.

 

 

 

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 rates of duty on flat rolled products of stainless steel classifiable under various subheadings of headings 72.19 and 72.20 have been increased from free of duty to 5% by the insertion of various additional (8-digit) subheadings as recommended in ITAC Report No 535.

The amendments were published under Notice No. R. 199 which was published in Government Gazette No. 40661 of 3 March 2017.

The amendments will be forwarded to Jacobsens Subscribers under cover of Supplement 1085.

The amendments have been published in the Customs Watch which is also available on the Jacobsens website at www.jacobsens.co.za.

 

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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