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

 

22 September 2017

 

 

Latest News

FROM FREE TRADE AREA TO ECONOMIC UNION

The SADC Trade Treaty, also known as the SADC Protocol on Trade is a Free Trade Agreement (FTA). The SADC Protocol on Trade envisages the establishment of a Free Trade Area (FTA) in the SADC Region.

Five of the SADC Countries, Botswana, Lesotho, Namibia, South Africa and Swaziland belong to the Southern African Customs Union (SACU).

The African Union’s medium to long-term economic vision for the region are various steps of regional integration – from the creation of regional economic communities (RECs) and the strengthening of existing regional economic communities to the establishment of a free-trade area (FTA) and a customs union for each REC (by 2017) and eventually the establishment of a Central African Bank by 2018.

These are steps of regional economic integration which not many people are familiar with and it is of interest for all of us on the continent.

We will be introducing you to the terminology relevant to regional economic integration over the next few weeks. 

 

Classification Corner                                                                                                                    

The Southern African Customs Union Tariff (Jacobsens Harmonized Customs Tariff) is a combined tariff (revenue collection and trade policy tool) and a statistical tariff. Since the introduction of the Harmonized System in 1988 most countries have combined their import tariffs with statistical nomenclatures. In many countries, their national tariff nomenclatures are also export tariffs. However, certain countries have separate export tariffs based on the Harmonized System.  

Governments need high-quality statistical information. Statistical information regarding the importation of goods into and from the Southern African Customs Union (SACU) is compiled by the SARS Customs Division based on the WCO Harmonized System. The statistics (trade data) are compiled by Customs administrations and are then also incorporated in the products and publications of other organizations in South Africa and the rest of the region based on information produced by exporters and importers on their SAD 500 customs clearance declarations. It is therefore very important that exporters and importers (and their appointed customs brokers) provide SARS – and the other customs administrations in the region – with the correct HS code.

Most of the information in the region is compiled by SARS as the bulk of the exports and imports are done through South Africa.

Statistical information is however gathered and analyzed by exchanging figures from the national statistical offices across the SACU region. To be useful, governments need comparable and harmonized data to use in the definition, implementation and analysis of SACU policies, in light of the fact that regional integration in the region is becoming more important.

Statistical products and services are also of great value to the business community (within SACU and abroad), professional organisations, academics, the media and private persons planning to export and import.

Traders, with the assistance of their appointed customs brokers, are primarily responsible for the correct classification of goods. Customs administrations may make tariff determinations if they are not in agreement with the self-determinations that have been made by the traders.

HS classification is also important since there is a close correlation between the HS and other goods and service nomenclatures.

 

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 received an application for the creation of a temporary provision for the importation of certain hot rolled steel products classifiable under headings 72.08 and 72.25, which are subject to SAFEGUARD DUTIES, under rebate.

Contact Mr Pfarelo Phaswana and/or Ms Lufuno Maliagaat (012) 394 3628 or (012) 394 3835 or e-mails pphaswana@itac.org.za or lmaliaga@itac.org.za for more information.  (The ITAC Reference is 11/2017)

The notice was published under Notice 723 of 2017 in Government Gazette No. 41119 of 15 September 2017. Comments are due on 29 September 2017.

 

 

 

 

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 rate of duty on sugar, classifiable in HS  tariff subheadings 1701.11, 1701.12, 1701.13, 1701.14, 1701.91 and 1701.99 has been increased from free to 213,1c/kg as recommended in ITAC Minute M11/2017. The amendment was published under Notice R. 1000 in the Government Gazette 41118 of 15 September 2017.

The loose-leaf pages to amend the Jacobsens Harmonized Customs Tariff in respect of the updated sugar rates will be sent to Jacobsens subscribers under cover of Supplement 1094.

 

 

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.

Rule 200.08, originally published in Government Notice R.1874 of 8 December 1995, is amended to amend the places where container depots may be established.

The Rule amendment (DAR/167) was published under Notice R. 999 in Government Gazette 41115 of 15 September 2017.

 

 

 

 

 

Contact Information:

 

 

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

 

© 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 jacobsens@lexisnexis.co.za.